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Retail payments supervision

Learn about the Bank of Canada’s role in supervising payment service providers, next steps and how you can get involved.


Under the Retail Payment Activities Act (RPAA), the Bank will be responsible for supervising payment service providers (PSPs). The aim is to build confidence in the safety and reliability of their services while protecting end users from specific risks.

The Department of Finance Canada is leading the development of regulations for the supervisory framework with support from the Bank. Proposed regulations to help clarify details of the RPAA have been published in Part I of the Canada Gazette.

Our supervisory framework

To fulfill our obligations under the RPAA, we developed a framework for retail payments supervision that explains how we will:

  • supervise PSPs to determine if they comply with the RPAA
  • promote compliance
  • monitor and evaluate trends and issues in the payment system

What we won’t do

We will not supervise financial businesses or payment systems that are prudentially regulated by federal or provincial laws, such as commercial banks and credit unions.

We will not offer broader consumer protection, such as:

  • dispute resolution between a PSP and its end users
  • concerns about fees charged by PSPs
  • privacy complaints

Our role is not geared toward preventing PSPs from failure or insolvency.

Unlike a licensing program, this supervisory framework will not enable us to authorize firms to operate as a particular type of entity.

Canada’s Minister of Finance will be responsible for conducting a national security review of PSPs.

About payment service providers

According to the RPAA, PSPs include a variety of entities that perform electronic payment functions, such as payment processors, digital wallets, money transfer services and other payment technology companies that offer retail payment services.

Payment functions

We are interpreting the payment functions outlined in the RPAA to determine which entities or individuals will be considered a PSP.

Providing or maintaining a payment account

Individuals or entities:

  • provide or maintain a payment account if they store personal or financial information about end users to make it easier to carry out future transactions
  • do not provide or maintain a payment account if they store personal or financial information:
    • for purposes other than making an electronic funds transfer (EFT)
    • for making it easier to conduct a one-time transaction but not for future EFTs

Holding funds

Information about how we interpret this function will be released when it becomes available.

Initiating an electronic funds transfer

An EFT is initiated when a payer or a payee sends the first instruction to start a transaction, either as a push or pull payment.

  • A push payment is when the payer sends an instruction to move funds to the payee’s account. This type of payment is commonly used for a one-time online purchase or a transfer of funds that occurs only once.
  • A pull payment is when the payee sends an instruction sent to move funds from the payer’s account. This type of payment is commonly used for recurring bills and subscriptions.

Both push and pull payments require the payer’s consent.

Authorizing or transmitting instructions about an electronic funds transfer

A PSP authorizes an EFT if it:

  • requests that the end user confirm whether they sent or received an EFT
  • confirms that the end user has enough funds to make the requested EFT
  • has an arrangement with its end user to send or receive an EFT without an action taken by the end user (i.e., pre-authorized)
  • debits or credits an end user’s account as directed by the payment instruction associated with an EFT

A PSP transmits, receives or facilitates an instruction about an EFT if it:

  • sends payment instructions
  • receives payment instructions
  • provides the infrastructure that enables payment instructions to be sent or received

Clearing or settling

The clearing process involves transmitting, reconciling and, in some cases, confirming transactions before they are settled. It includes:

  • preparing and calculating final balances for settlement
  • exchanging the necessary information

The settlement process releases the payment obligations between two or more PSPs according to the terms of the transaction. The transaction is considered complete once settlement takes place.

Money service businesses

Individuals or entities registered with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) as a money service business must register with us as a PSP if they perform retail payment activities covered by the RPAA.

Our role is to supervise registered PSPs in relation to operational and financial risks to ensure the safety and the reliability of PSPs.

FINTRAC will continue to regulate money service businesses in relation to:

  • anti-money laundering
  • anti-terrorist financing

About cost recovery

Under the RPAA, we are required to recover the costs of supervising PSPs through two types of fees.

Registration fee

As part of their application, all applicants will need to pay a fee when registering with us. We will only review an application once we have received this fee.

Annual assessment fee

Registered PSPs will need to pay an annual assessment fee.

This fee will recover the cost of the Bank’s supervisory activities under the RPAA that have not been recovered through the registration fee, using a set formula.

The Department of Finance Canada will hold consultations to develop regulations on the amount of these fees and how they will be calculated.

The cost of implementing the retail payments supervision (RPS) mandate depends on several factors, including the number of PSPs in scope of the RPAA and the efforts that will be required to assess whether PSPs are adequately meeting their regulatory requirements.

Key milestones

Here is what to expect as we prepare for the implementation of the RPAA.


The RPAA establishes the legal framework for us to supervise PSPs, including its scope and powers. It was approved by Parliament on June 29, 2021, and is expected to come into force in stages, as described below.


Regulations to help clarify the details of the legislation to support the RPAA. Regulations, like legislation, have the force of law.

  • Drafting: While the Department of Finance Canada drafted regulations, we engaged with stakeholders and provided technical expertise and advice as required.
  • Approving: The Department of Finance Canada submitted the regulations to the Treasury Board—the committee of ministers that oversees the Government of Canada’s spending and operations—for approval.
  • Publishing: Proposed regulations are published for public comment in Part I of the Canada Gazette.
  • Reviewing and republishing: The Government of Canada will review comments and consider changes to the regulations, if needed. A final version of the regulations will then be published in Part II of the Canada Gazette.


Once regulations are published in Part II of the Canada Gazette, we will start to issue guidance on specific topics related to the RPAA and the final regulations.

Our guidance will be published in two forms:

Supervisory policy   

These documents clarify what we will do to carry out our supervisory role, including registration and enforcement activities.


In addition, we will issue guidelines on the legislation and final regulations. These will clarify the standards and practices we expect PSPs to incorporate into their business operations to meet requirements on:

  • managing operational risks
  • safeguarding end-user funds
  • reporting on incidents

Registration pilot

We will test our registration process and identify areas of improvement before provisions of the RPAA come into force.

Coming into force

PSPs will be required to register with us before they are subject to the requirements for operational risk management and safeguarding end-user funds.

The federal Cabinet will decide how and when each provision of the RPAA will come into force.

Get involved

Here is how we are engaging with industry and stakeholders to better understand the retail payment landscape.


As we finalize our guidelines, we will consult with industry and stakeholders to get their feedback on how this new regulatory work will affect PSPs.

For information about our next consultation and how to participate, subscribe to the retail payments supervision newsletter.

Retail Payments Advisory Committee

The Retail Payments Advisory Committee (RPAC) was established in 2020 to provide industry expertise to the Bank.

RPAC members meet as required to discuss issues related to retail payments. Agendas and any discussion material are published before each meeting.

Not a member of RPAC? Read discussion materials prepared for RPAC meetings and send us your feedback by .

Registration pilot

We are testing our registration process to assure its effectiveness and find any areas that need to be improved before registration opens.

As part of this work, we will ask individuals and entities that are subject to the RPAA to test the registration process. Participants will be able to provide feedback on the overall process for registering, which we will use to improve our registration guidance and the PSP portal.

We will send an open call for volunteers to participate in this pilot through our newsletter.

We will invite some volunteers to take part in the testing. Selection will be based on factors such as business size and model, location and language. These factors will help us get feedback from a representative sample of PSPs who will be required to register with us.

Participating in the pilot doesn't mean an entity or individual is registered. All participants will need to submit their registration application with the Bank once registration opens.

Retail payments supervision and access to Real-Time Rail

Consumers and businesses benefit from innovation in the payment system when the right precautions are in place. Our retail payments supervisory framework will complement work led by Payments Canada to modernize Canada’s core payment systems. A new payment system, Real-Time Rail (RTR), is an important part of this modernization.

When launched, the RTR will allow Canadian consumers and businesses to exchange funds in real time. PSPs may have access to the RTR system if they:

  • are eligible for membership with Payments Canada
  • meet specific requirements

Under the Canadian Payments Act, entities eligible for Payments Canada membership include:

  • domestic and authorized foreign banks
  • other deposit-taking institutions, such as trust and loan companies

The Department of Finance Canada is working to expand the eligibility criteria to include PSPs supervised under the RPAA. When Finance Canada expands the eligibility requirements, PSPs who wish to connect to the RTR must register with us before they can apply to become a member of Payments Canada.

Within the RTR system, PSPs will be able to:

  • exchange payments in real time
  • settle and clear their own transactions
  • rely on other participants to provide settlement service

Once registered, PSPs that wish to settle transactions will be required to apply to open a settlement account with us.

Stay informed

For project updates, subscribe to the retail payments supervision newsletter.

If you have questions about retail payments supervision or have any comments on this topic, contact us.

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