Scotiabank launches real-time business payments using Interac network

Scotiabank is an early adopter of a Canadian initiative to improve liquidity for B2B transactions by speeding processing.

The bank will use Interac e-Transfer, a feature from Canada's national debit network. Transactions are processed in real-time with confirmation of payment delivered within five seconds and funds are immediately available. The speed is designed to make it more convenient for businesses to make just-in-time payments for bills marked cash-on-delivery or to take advantage of invoice discounts offered for early payment.

"With new capabilities, like enhanced data to ease reconciliation and account number routing to make sending payments easier, we are continuing to enable value added services as we upgrade our payment capabilities," Chemi Nanglu, head of product and operations, global business payments at Scotiabank, said in a press release.

Interac is diversifying its product range to counter inroads from Visa and Mastercard. Payments Canada, Canada's clearing system, announced in November that it will use Mastercard’s Vocalink to support clearing and settlement for the Real-Time Rail (RTR), following a procurement process that includes the Bank of Canada and the Department of Finance. RTR will allow Canadians to send and receive funds in seconds at all times.

Ronald Patrick/Bloomberg

Interac also announced in November that it had partnered with Walmart to expand online and in-store payment options for Walmart customers throughout Canada, with plans to have the new technology in place by spring of 2021. Interac, released plans in February 2019 that it would expand its person-to-person (P2P) transfer service into B2B payments to further gain wider adoption.

This followed a move by Visa, which used Visa direct to add B2C and B2B payments in Canada in 2018. Peoples Payment Solutions and TELUS Health and Payment Solutions were among the first active companies at the time of launch. Visa P2P services had been in market for about five years before the move into business payments with its near-real-time Visa Direct service.

"Interac e-Transfer for Business is poised to do for business payments what Interac e-Transfer did for peer-to-peer transactions," Peter Maoloni, vice president, product and services at Interac Corp., said in the release. "With enhanced capabilities like real-time, high-value and data-rich payments, businesses can streamline accounting processes to maximize the efficiency in utilizing working capital for their business' financial management needs."