New Retail Payment Activities Act Introduced

The Department of Finance recently introduced new legislation that will require payment service providers that operate in Canada to register with the Bank of Canada and comply with certain operational requirements. The short title of this draft legislation is the Retail Payment Activities Act (the "RPAA"). Subject to certain exemptions, the RPAA captures the following activities:

• the provision or maintenance of an account that, in relation to an "electronic funds transfer", is held on behalf of one or more end users;
• the holding of funds on behalf of an end user until they are withdrawn by the end user or transferred to another individual or entity;
• the initiation of an "electronic funds transfer" at the request of an end user;