Evidence of meeting #151 for Industry, Science and Technology in the 44th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was bank.
A recording is available from Parliament.
Liberal
Chandra Arya Liberal Nepean, ON
It's a limited amount.
At any rate, on November 1, you had an outage or whatever you called the technical glitch. Was it due to a cyber-attack?
President and Chief Executive Officer, Interac Corp.
In the e-transfer degradation of service, which was not an outage, e-transfers were taking longer than a lot of people expected. Because it was rent day, it was a particularly painful experience for a lot of customers. It was not to do with a cyber-attack.
Liberal
Chandra Arya Liberal Nepean, ON
A colleague of mine asked about blockchain technologies. Do you think blockchain technologies will disrupt your system?
President and Chief Executive Officer, Interac Corp.
I think emerging technologies are always something we need to consider, whether it's the public cloud, AI, blockchain or the next emerging technology after that. There is no doubt in my mind, personally, that blockchain will play an important role in the movement of money in the future.
Liberal
Chandra Arya Liberal Nepean, ON
A witness we had at the committee last time is the chief operating officer of a software company. He said:
...Interac offerings are not progressing at a comparable rate to other notable payment providers around the world. In comparing Interac with providers from the United Kingdom, Sweden, India and Brazil, for example, we found that in under three years, these countries rolled out cheaper, faster, more modern and feature-packed alternatives to their existing payment networks without significant disturbances.
What are your comments on that?
President and Chief Executive Officer, Interac Corp.
E-transfer is a household name and a verb in Canada. It is used by everybody in Canada to send money to loved ones and to small and medium-sized businesses to accept. That is a sign of a payment system adopted by many, used by many and trusted by many.
The Pix network in Brazil, the UPI network in India and the Swish platform in Sweden are all fantastic platforms as well, but e-transfer is more widely used than those systems.
Liberal
Chandra Arya Liberal Nepean, ON
You keep repeating that e-transfer is more widely used by most Canadians. It's because we don't have any alternative. For example, if people have to use a phone, they have to use Rogers, Bell or Telus. They don't have any alternative.
You keep saying that most Canadians use this. It's because we lack alternatives. Is that right?
President and Chief Executive Officer, Interac Corp.
E-transfer represents 6% of electronic transfers. Debit rails are used to move money. EFT rails are used to move money, like e-transfer. It's only 6% of total electronic transactions. There are alternatives in the marketplace.
Liberal
Chandra Arya Liberal Nepean, ON
You keep saying that you are a private company, so you can't disclose your ownership structure or profitability, but you are a unique player in the Canadian market. Is that right?
President and Chief Executive Officer, Interac Corp.
We're a unique player that provides e-transfer, debit and verification services. When you put all three of those together, we're absolutely a unique player.
Liberal
President and Chief Executive Officer, Interac Corp.
Interac shareholding is across many different financial institutions and ecosystem players.
Liberal
Chandra Arya Liberal Nepean, ON
I'm not talking about the number of institutions. Let's put it this way. The number of shareholders, big shareholders, is limited. Is that correct?
President and Chief Executive Officer, Interac Corp.
We have large shareholders. We have small shareholders.
Liberal
Chandra Arya Liberal Nepean, ON
Exactly. The large shareholders probably control the bulk of the shareholder voting rights. Is that correct?
President and Chief Executive Officer, Interac Corp.
We have large shareholders and small shareholders. As a privately held company, we don't disclose the shareholdings.
Liberal
Chandra Arya Liberal Nepean, ON
This is the problem we have. With the way it has been structured, we can't question the ownership. We can't question your profitability. We can't question your revenue sources or the cost structure because you can always claim to be private. That's all the system is.
Thanks, Chair. I know I wore out my time.
Liberal
The Chair Liberal Joël Lightbound
That was interesting, Mr. Arya, so I allowed you to pursue it.
I'll just ask one follow-up question. You keep mentioning, Mr. Wilmot, that 6% of all electronic payments are made through the Interac e-transfer system. You include credit card payments. Is that right?
December 9th, 2024 / 7:20 p.m.
President and Chief Executive Officer, Interac Corp.
Credit card payments are in that 6%.
Liberal
The Chair Liberal Joël Lightbound
You keep using the example of sending money to your son or daughter in university. How can I use my Mastercard to send them money if they need it? The only option I have is Interac e-transfer, isn't it?
Liberal
The Chair Liberal Joël Lightbound
If you exclude credit card payments, what's the percentage that you guys have of all transactions?
President and Chief Executive Officer, Interac Corp.
There are 18.5 billion transactions, which include credit cards. If I understand correctly, I think credit cards make up approximately six billion transactions, and 1.2 billion transactions of 12 billion transactions is approximately 10%. Debit cards and EFT are clear channels to move money between businesses and between people.
Liberal
The Chair Liberal Joël Lightbound
Don't you need to be within the same institution usually? If I want to send money to someone who's using a different banking institution, and I'm with Desjardins and they're with BMO, what are the options I have?
President and Chief Executive Officer, Interac Corp.
Debit rails, EFT rails and e-transfer are all possible for fintechs to provide services to businesses and people to move from one account to another account at a different financial institution.