A coalition of 14 Canadian financial institutions has called on the country’s Minister of Finance Chrystia Freeland (above) to make changes to the Canadian Payments act (CP Act) to expand access to payment systems.

A joint letter to Minister Freeland says change is needed because “The Canadian regulatory framework has not kept pace with global and domestic payment developments.” In particular, the signatories want to see membership of Payments Canada opened up to credit unions, payments service providers (PSPs) and eligible financial market infrastructure entities.

Payments Canada owns and operates Canada’s payments clearing and settlements infrastructure, and coordinated the letter. Signatories include The Canadian Bankers Association, the Canadian Credit Union Association, the Consumers Council of Canada and the Electronic Transactions Association.

Broaden membership

The letter says that “Unlike their international counterparts in other comparable jurisdictions, systemically important Canadian Financial Market Infrastructures (FMIs) are ineligible under the CP Act to be direct participants on Canada’s national payment systems” and concludes that “amendments to the CP Act are needed to broaden the membership of Payments Canada to allow safe, risk-based access to Payments Canada’s systems for qualifying entities”.

The organisations call for “ongoing dialogue to ensure an appropriate and effective governance structure for Payments Canada” and recommend the government also considers “amendments to the CP Act to better manage the increasing risks associated with Payments Canada’s evolving role in the good faith pursuit of its public interest mandate”.

The letter says changes could be brought forward as part of the country’s 2023 Budget.