The COVID-19 pandemic, with physical distancing restrictions and the closure of non-essential businesses, is changing the way consumers shop at traditional brick-and-mortar locations. It is also accelerating Canadians’ shift to digital payment solutions for remote payments where cheques may have traditionally been used, such as rent, person-to-person, person-to-small business and other business payments and money transfers.
Cashflow becomes especially important during times of uncertainty. Cheques can be cumbersome and maintain a risk of non-sufficient funds. Digital solutions, however, offer Canadians almost immediate access to their money at a time when they need it most.
Canadians turn to the Interac e-Transfer platform for online money transfers
The Interac e-Transfer service remains an everyday staple in the lives of Canadians, as demonstrated during the pandemic when the platform reached a historical daily high on May 1, 2020, with over 3.75 million transactions. Canadians are increasingly looking for secure, convenient, and near real-time payment systems during the COVID-19 pandemic, and many are turning towards the Interac e-Transfer service – some for the very first time. In fact, since the outset of the pandemic, the growth of first-time Interac e-Transfer users has been 43 percent higher when compared to user growth during the same time last year1.
Canadians are also using the Interac e-Transfer platform more often. The average number of Interac e-Transfer transactions per user in April grew by 9 percent compared to the same time period last year2.
New money transfer use cases emerge during pandemic
As some emergency orders remain in place, Canadians aren’t using the Interac e-Transfer service as often to split dinner tabs, reimburse concert tickets or settle up road trips. Instead, different money transfer use cases are growing and emerging.
To adhere to physical distancing restrictions, many Canadians are opting to split grocery shopping responsibilities with family, roommates and neighbours. Since the beginning of the COVID-19 pandemic, Canadians have used the Interac e-Transfer service to split grocery bills and orders from big-box stores more often than they previously have3.
Sending financial support to family and neighbours is another growing use case during this pandemic. This could mean splitting the cost of supplies or simply sending funds to those in need. Since March 15 there have been 27 per cent more proximity Interac e-Transfer transactions sent than forecasted4. Proximity Interac e-Transfer transactions are transactions made between users in the same place. This shows Canadians are using the Interac e-Transfer service for in-person transactions as well.
Canadian organizations streamline payment services using Interac e-Transfer
As consumers shift to the Interac e-Transfer service for many of their daily needs, Canadian businesses are not far behind. Since the end of March, businesses have been receiving 35 per cent more Interac e-Transfer transactions than expected5. For many small businesses, the Interac e-Transfer platform is a convenient solution that allows them to adapt to the digital economy.
In 2018, commercial cheques accounted for 70 per cent of total cheque volume, but organizations are becoming more interested in streamlining payment services and automating reconciliation6. These qualities become even more important in times of crisis, especially as many organizations need to move money quickly and securely to ensure citizens get the vital support they need.
Since the beginning of COVID-19 restrictions in Canada, the number of bulk Interac e-Transfer transactions increased 50 per cent more than expected7. Some of this increase is due to the distribution of emergency payments, for example the Province of Alberta distributing one-time COVID-19 relief payments via the Interac e-Transfer service for those self-isolating and unable to work. The Canadian Hospitality Worker Relief Fund is also using the Interac e-Transfer platform to disburse funds to grant recipients in the hospitality industry. Interac e-Transfer Bulk Payables is a product built on the Interac e-Transfer platform that offers organizations a secure and cost-efficient way to initiate many payments through a single file upload.
1: Based on Interac e-Transfer transaction data from March 16, 2020 – May 3, 2020
2: Based on Interac e-Transfer transaction data from March 30, 2020 – May 3, 2020
3: Based on Interac e-Transfer transaction data from March 16, 2020 – April 17, 2020
4: Based on Interac e-Transfer transaction data from March 16, 2020 – May 3, 2020
5: Based on Interac e-Transfer transaction data from March 30, 2020 – May 3, 2020
6: Canadian Payment Methods and Trends. 2019.
7: Based on Interac e-Transfer transaction data from March 16, 2020 – May 3, 2020