You’ve likely used an Interac e-Transfer to repay a friend for dinner, split rent with a roommate, send birthday money to a family member or move funds between accounts at different banks. For customers of major banks and many credit unions, e-Transfer is fast and convenient. But if you bank with a neobank or a fintech, your Interac e-Transfer options have typically been more limited—facing slower processing times, lower transfer limits or additional steps because many of those firms accessed Interac indirectly through a banking partner.
That is beginning to change. On Sept. 29, Interac announced an expansion of direct access to its e-Transfer services for a broader set of financial institutions in Canada. Wealthsimple is the first fintech to be provisionally accepted as a direct participant. Previously, only federally regulated banks, provincially regulated credit unions and a small number of challenger banks could participate directly in Interac e-Transfer services, which limited how quickly and how much fintech customers could move between accounts.
Wealthsimple formerly relied on a banking partner to access Interac’s system. That indirect arrangement increased operating costs for Wealthsimple and created transactional limits for clients. While Wealthsimple had reduced settlement times to roughly 30 minutes for some transfers, becoming a direct participant allows the company to offer near-instant settlements and higher transfer limits—features that should make funding accounts and moving money simpler and faster for customers.
“Becoming a direct participant is game-changing,” says Hanna Zaidi, chief compliance officer of payments at Wealthsimple. “It means we can offer our clients a better experience when moving their money—things like higher transfer limits and faster settlement times—which are important factors when making investment decisions.” Zaidi adds that many Wealthsimple clients prefer using e-Transfer to fund accounts because it is familiar, fast and seamless.
Faster e-Transfer settlement removes friction that can otherwise delay investing or urgent payments. Other transfer methods, like traditional bank transfers (for example, electronic funds transfers between institutions), can take several business days to clear and settle, which can be inconvenient for users who need immediate access to funds.
Beyond funding bank-like accounts, Wealthsimple customers can also move money from Wealthsimple Save or Wealthsimple Cash accounts into other Wealthsimple products, such as Wealthsimple Trade self-directed investing accounts or Wealthsimple Crypto accounts. Direct access to Interac’s network should streamline those internal transfers and make them more reliable for customers who frequently move funds across Wealthsimple services.
Is Wealthsimple a bank?
No. Wealthsimple is a financial services company and securities dealer serving more than three million Canadians. Although it is not a bank, some Wealthsimple accounts are protected by the Canada Deposit Insurance Corporation (CDIC) through partnerships with federally regulated Canadian financial institutions. For example, the Wealthsimple Cash account—a hybrid chequing and savings product—carries CDIC coverage of up to $300,000, which the company notes is three times the average CDIC insurance protection. The Wealthsimple Cash account does not charge fees for the improved e-Transfer service and offers 1% cash back on card purchases that clients can choose to reinvest automatically in stocks or crypto.
“High banking fees, long payment and asset transfer times, rising interest rates and the increasing cost of living are putting pressure on Canadians,” Zaidi says. “That’s why we’re building products and solutions that offer greater value and help put people’s money to work.” Fintechs and neobanks have been reshaping the banking landscape in Canada by focusing on digital convenience, lower fees and faster services.
What does the Interac expansion mean for the future of Canadian banking?
The move to broaden direct access to Interac’s e-Transfer network signals that the customer experience at fintechs may soon resemble what traditional banks and credit unions offer. Allowing more fintechs and neobanks to participate directly creates stronger competition in payments and deposits, which can drive innovation, faster services and better prices for consumers.
Will Keliehor, Interac’s chief commercial officer, frames the change as a win-win for fintechs and their customers: “Interac wants to move at the speed of fintechs because they’re constantly innovating the digital economy. And that’s good for all Canadians, because it gives faster access to products that can add value in people’s lives.” Greater access to Interac’s infrastructure could encourage more product experimentation and faster feature rollouts from non-bank financial firms.
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