Scott Talbott, ETA CPP, EVP, ETA had a discussion with Jackie Shinfield, Partner, Blakes about key compliance issues in Canada's payments industry. Their discussion serves as a preview for the regulatory focus for 2025 in Canada as the payments sector is rapidly growing and changing.
As we look toward 2025, Canada’s payments landscape is undergoing a remarkable transformation. The numbers tell a compelling story: in 2023 alone, Canadians executed a staggering 21.7 billion payment transactions valued at $11.9 trillion, with credit transactions representing a third of total volume. This isn’t just incremental change – it’s a fundamental shift in how Canadians conduct business and manage their finances.
Digital is Now a Mainstay
The pandemic has permanently altered consumer behavior, accelerating the adoption of digital payments across the country. Digital payments now account for 86% of total payment volume and 75% of total payment value in Canada2. This trend is expected to continue, driven by contactless payments reaching 63% of all in-store transactions in 2023, a 17% increase from the previous year3.
Fresh Set of Compliance Challenges
For compliance professionals, this rapid evolution presents both challenges and opportunities. The regulatory landscape is becoming increasingly complex, with multiple regulatory bodies taking an active interest in the payments sector. The Retail Payments Activities Act (RPAA) and Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) are reshaping the regulatory framework, while organizations like the Financial Consumer Agency of Canada and FINTRAC are intensifying their oversight of payment services.
Artificial Intelligence
One of the most significant developments is the growing role of artificial intelligence in payment systems. AI has become a crucial tool in fraud prevention, helping financial institutions combat increasingly sophisticated schemes. However, this technological advancement brings its own compliance challenges. Compliance officers must now ensure their AI systems are not only effective but also responsible and compliant with emerging regulations.
Privacy and Data Protection
Privacy and data protection have taken center stage as well. As provinces continue to enact their own privacy laws, payment providers face the challenge of navigating a complex patchwork of regulations. The key to success will be developing comprehensive privacy frameworks consistent with Payment Card Industry Data Security Standard (PCI DSS) that can adapt to evolving requirements while maintaining the trust of consumers and merchants alike.
Consumer protection remains paramount, with the government placing increased emphasis on transparency in fees, charges, and overall service terms. The industry is also seeing a push toward enhanced financial literacy initiatives, recognizing that educated consumers are better equipped to make informed financial decisions.
What to Prepare For
Looking ahead to 2025, compliance professionals should prepare for several key developments.
The evolving payments landscape demands a recalibration of compliance frameworks. While traditional AML protocols remain foundational, the integration of AI systems and real-time payment capabilities requires sophisticated governance models. The ETA’s Payments Compliance Conference – Canada, agenda reflects this complexity, featuring dedicated sessions on AI governance, regulatory enforcement protocols, and network compliance requirements.
Strategic Considerations
Success in this environment requires a dual focus: rigorous compliance architecture and dynamic risk management capabilities. Compliance professionals must develop frameworks that address both current requirements and emerging challenges, particularly in areas of AI implementation, money transmission, privacy protection, and real-time payment monitoring. The conference’s emphasis on advanced compliance sessions and network-specific requirements underscores this strategic imperative.
ETA CEO Jodie Kelley, joined Kevin Rosenquist of Soar Payments on their podcast Paypod. Jodie shares her journey and insights on how the payments industry drives global commerce, fosters innovation, and navigates regulatory challenges to empower economic growth.
WHAT WAS DISCUSSED
This episode highlights how technologies like AI, blockchain, and biometrics are transforming the payments industry, driven by consumer demand and shaped by public policy challenges. It also emphasizes the importance of gender diversity and strategies for fostering inclusivity, resilience, and security in fintech.
LEARN HERE
Watch the full podcast here.
In the latest episode of Transaction Trending, ETA’s podcast exploring payments evolution, Michael Reed, CEO of Sola (formerly Fidelity Payment Services and CardKnox), shares insights into how industry leaders leverage ETA membership during transformative periods. The conversation offers listeners a unique perspective on both company transformation and industry collaboration.
Throughout the interview, Reed discusses Sola’s journey from a traditional retail ISO to a technology-first organization, coinciding with their strategic decision to join ETA. “With the rebrand, we’re looking to unify not just our company but the vision that we have for our business in the market,” Reed explains. “Being part of ETA is a great opportunity for us to engage with peers and with industry leaders and to get an idea of what they’re seeing and where they’re headed.”
With 95% of Sola’s business flowing through their proprietary gateway, he describes how ETA membership enhances their ability to innovate: “The area that I’m most excited about for Sola and the ETA to work together is really through that lens of innovation… ETA provides us with a great opportunity to see what’s happening in the market, to learn more about innovative things that are that are happening that others are doing so that we can determine how best to integrate those into our platform and our offering.”
The conversation offers both established payment companies and emerging fintech firms valuable perspectives on industry collaboration through the lens of one company’s transformative journey.
Listen to the full episode to hear more about:
Watch the full episode here. For more information about ETA membership, visit electran.org. To learn more about Sola’s payment solutions, visit solapayments.com.
The information provided in this blog post is for general informational purposes only and does not constitute legal advice. This content is based on a conversation with Michael Reed and reflects his professional opinions as of the date of the interview. Readers should not act or refrain from acting based on this information without seeking professional legal counsel. Neither the author, Michael Reed, Sola, nor any affiliated entities assume any liability for actions taken or not taken based on the contents of this blog post.
The holidays are a time for giving, and the way we give has evolved dramatically. From cash and checks to a dazzling array of digital options, the world of payments has transformed, offering consumers and businesses more choices than ever before. This holiday season, let’s explore the diverse landscape of payment options for holiday gifting.
Mobile Wallets: The Future in Your Pocket: Mobile wallets like Apple Pay, Google Pay, and Samsung Pay allow you to store your credit and debit card information securely on your phone, enabling contactless payments with a simple tap. They offer speed, convenience, and enhanced security.
Contactless Payments: Tap and Go: Contactless payments are becoming increasingly popular, allowing you to pay by simply tapping your card or phone on a compatible terminal. This technology makes transactions faster and more hygienic.
Buy Now, Pay Later (BNPL): Flexible Financing: BNPL services offer consumers the flexibility to spread out their holiday spending over time, often with interest-free installments. This option can help manage budgets and make larger purchases more manageable.
Other Innovative Solutions: The payments industry is constantly innovating, with new solutions emerging all the time. These include peer-to-peer payment apps, biometric authentication, and even cryptocurrency payments.
Our members are at the heart of this payment revolution. They are developing and implementing these innovative solutions, empowering consumers and businesses with greater choice, convenience, and security. By embracing these advancements, ETA members are shaping the future of commerce.
Where do traditional banks fit in modern financial services, a landscape increasingly dominated by open banking?
Amanda Estiverne-Colas was a 2024 TRANSACT speaker and a winner of 2023 ETA’s Forty Under 40.
In the dynamic landscape of banking and payments, where innovation and technology constantly reshape the industry, the role of executive presence (EP) has taken on new dimensions. As a seasoned professional in this field, I’ve observed how the definition of EP has evolved, particularly in light of the increasing emphasis on empathy and emotional intelligence (EI).
In this blog post, I’ll explore the intersection of EP, EI, and leadership within the banking and payments sector, offering insights and practical tips for professionals looking to enhance their executive presence while leading with empathy.
REDEFINING EXECUTIVE PRESENCE IN A CHANGING LANDSCAPE
Traditionally, executive presence has been associated with traits like gravitas, strong communication skills, and a polished appearance. While these attributes remain essential, the contemporary banking and payments industry demands a broader perspective. Today, EP encompasses not only how we carry ourselves but also how effectively we connect with others on an emotional level.
In an era marked by economic uncertainty and rapid technological advancement, leaders must cultivate empathy and EI to inspire trust and foster meaningful relationships. As the industry embraces diversity and inclusivity, the definition of EP expands to encompass a genuine understanding of the diverse perspectives and experiences within our teams and client base.
THE ROLE OF EMOTIONAL INTELLIGENCE IN BUILDING EXECUTIVE PRESENCE
Emotional intelligence serves as the foundation of effective leadership, influencing how leaders navigate challenges, inspire teams, and drive innovation. Within the realm of banking and payments, where collaboration and client relationships are paramount, EI plays a pivotal role in establishing credibility and rapport.
By honing key EI competencies such as self-awareness, self-regulation, empathy, and social skills, banking professionals can elevate their executive presence and become more effective leaders. Self-awareness, in particular, empowers leaders to recognize their strengths and areas for growth, enabling them to adapt their leadership style to different situations and personalities.
PRACTICAL STEPS FOR CULTIVATING EXECUTIVE PRESENCE WITH EMPATHY
Building executive presence with empathy requires intentional effort and a commitment to continuous growth. Here are some practical steps that banking and payments professionals can take to enhance their EP:
Gravitas (How You Act):
Communication (How You Speak):
Appearance (How You Look):
FROM AWARENESS TO INFLUENCE: MY PERSONAL JOURNEY
As a banking professional, my journey toward becoming a global speaker and influencer has been shaped by mentors, sponsors, and a commitment to self-improvement. By embracing feedback, seeking opportunities for growth, and actively supporting initiatives that empower women leaders, I’ve been able to navigate the complexities of the industry while staying true to myself and my values.
Through engagements similar to the EMPOW(H)ER initiative with ETA, I’ve had the privilege of connecting with women professionals from around the world, sharing insights, and championing diversity and inclusion in the workplace. By leveraging my platform to amplify diverse voices and perspectives, I’ve been able to make a meaningful impact within the industry and inspire others to do the same.
The ETA Industry Affairs Payment Facilitator Committee discussed Third Party Roles in ACH and their applicability to Payment Facilitation with guest speaker Nicole Meisner, partner at Taft Law.
Key takeaways for PayFacs to consider:
The Nacha Operating Rules (“Nacha Rules”) recognize the roles of third parties in facilitating ACH transactions, including Third Party Service Providers and Third Party Senders. All Third Party Senders are Third Party Service Providers but not all Third Party Service Providers are Third Party Senders. Generally, Third Party Service Providers are entities that perform any function on behalf of an Originator, ODFI or RDFI with respect to the processing of ACH entries. This includes mere creation of the ACH files. Third Party Senders, however, are Third Party Service Providers that serve as an intermediary on behalf of an Originator in transmitting ACH entries between that Originator and the Third Party Sender’s ODFI when there is not an Origination Agreement between the Originator and the ODF.
It’s imperative for payment facilitators to understand their role/classification under the Nacha Rules with respect to the ACH transactions that they facilitate. This includes ACH transactions that are utilized to move back-end settlement funds to a sub-merchant’s operating account. If a payment facilitator is designated as a Third-Party Sender under its agreement with its bank partner, it is subject to additional obligations under the Nacha Rules such as: registering with Nacha, conducting an annual ACH audit, and entering into an Origination Agreement with the Originators of such ACH transactions.
Beyond the requirements under the Nacha Rules, Payment Facilitators should carefully evaluate their role within the flow of funds for each segment of ACH transactions they facilitate to determine whether there are money transmission implications under state or federal law. Further, a Third Party Sender should never be identified as the “Originator” for entries that it transmits on behalf of another party in its capacity as a Third Party Sender.
If a Payment Facilitator is designated as a Third Party Sender, it must have a compliant Origination Agreement in place with its Originators, which at minimum must include the required provisions set forth in the Nacha Rules. Among other things, such agreement must bind the Originator to the Nacha Rules and include an authorization from the Originator for the ODFI to originate entries on the Originator’s behalf.
CDB is included and there is formal policy statement that was released, found attached. Here are the key details: Governance: FCAC has been given the mandate to oversee the regime. Legislative amendments to the FCAC . . .
