Interac

What is Interac?

Interac is not just an ordinary payment method, but an interbank network operated in Canada, connecting individual financial institutions with other businesses and enabling easier exchange of electronically conducted financial transactions. It offers users more than one way to make payments and has a portfolio adapted for both personal use and business needs.

History of Interac

This interbank network was first launched through the non-profit organization Interac Association in 1984, which initially connected five entities: RBC, CIBC, Scotiabank, TD, and Desjardins. By 2010, the network had expanded to more than 80 entities. Meanwhile, in 1996, the commercial entity Acxsys was established, offering services (including electronic money transfers) under the Interac brand. In 2018, Acxsys and Interac merged into one profitable organization named Interac Corporation, which continues to operate under this name, although there was a brief disruption in service in 2022.

Who owns the Interac payment method?

Interac Corporation is currently the sole owner of the Interac payment method, offering users several ways to conduct online and offline payments more easily, quickly, and securely. Its headquarters are located at Royal Bank Plaza in Toronto, Canada, and it mainly focuses its services on Canadian users. In 2019, it acquired 2Keys Corporation, a digital identity and cybersecurity company, and since 2021 it has had exclusive rights to provide digital ID services for Canada.

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What services does Interac offer?

Users of the Interac payment method have several options for making online payments on the internet, as well as in physical stores or in person with service providers or transport companies, ensuring their payments are fast, easy, and secure. For this purpose, several services are available to them through Interac.

Interac Direct Payment (IDP)

This service provides users with debit cards for purchasing goods and services. As early as 1990, it was possible to pay by entering a personal identification number (PIN), with the paid amount deducted from checking or savings accounts. By 2004, this method could also be used not just in Canada but also in the United States through the NYCE network merchants.

Interac chip cards

In 2007, Interac introduced a new payment option for merchants and service providers — special chip cards, or cards with an integrated circuit (cards by Europay, Mastercard, and Visa), offering greater security due to a high level of encryption.

Shared Cash Dispensing

This service allows users to withdraw cash from their accounts at any ATM without it having to belong to the financial institution that issued the payment card. Nowadays, nearly every ATM in Canada is part of the Interac system, allowing users to withdraw cash almost anywhere.

Interac e-Transfer

Interac e-Transfer allows users to send money to anyone who has a Canadian bank account, email address, and phone number. This service was originally operated solely by Acxsys Corporation but today is among the leading payment systems in Canada, overseen by the Bank of Canada.

Interac Online

This service enabled users to pay online for goods in e-shops or services directly from their bank accounts without sharing sensitive personal or payment information with merchants. As of January 6, 2023, its use began to be phased out and it is now reportedly fully discontinued.

How to use Interac?

Users of this payment method do not need to create any new accounts or remember additional login credentials. Interac is essentially a facilitator that allows users to perform online money transfers from their checking or savings accounts to the recipient’s account. All payments are made directly from the user’s bank account held with a Canadian bank, requiring confirmation of the transaction by logging into their online banking. Interac does not reveal, display, or store any login information.

Where to use Interac?

This payment method is primarily available within Canada or with Canadian merchants, service providers, or operators of online casinos. The company aims to connect different entities and enable payments that are easier, faster, and more secure, thereby protecting both users and payment recipients. Interac can also be used internationally through the Maestro or Cirrus networks.

Interac limits

Limits for payment services offered through this method may vary between banks from which users send their funds, as all transactions are subject to the limits set by the given bank account. The daily limit for e-Transfers usually ranges from $3,000 to $10,000 (approximately €2,880 – €7,200), and it is often possible to transfer a maximum of $3,000 in a single Interac transaction.

Fees for using the Interac payment method

Since users do not need to create any new accounts, there are no account maintenance fees. However, they may encounter transfer fees, which in some cases may be free or range from $0.50 to $1.50 (approximately €0.50 – €1.50). Payments made with Interac Debit at stores and physical locations usually do not incur fees (this may not apply abroad). However, banks themselves may charge transaction fees.

How to pay with Interac?

1. At a merchant, service provider, or online casino, select Interac as your payment method.
2. Enter or confirm the exact amount you want to transfer to the recipient’s bank account.
3. Log into your bank account using your set login credentials.
4. Complete and confirm the transaction.

How to withdraw money with Interac?

Interac allows users to use the e-Transfer Request Money service, through which they send a request for funds via the Interac e-Transfer system. Once the request is approved, users will be notified of the transaction by SMS or email. Money can also be withdrawn from almost any ATM associated with Interac’s network.

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Account with Interac

As mentioned above, to use Interac’s payment services, users do not need to create a separate account with login credentials. In fact, Interac does not allow private users to open accounts directly with them. To use the payment method, users simply need to have a bank account with a Canadian bank and make payments through Interac directly from that account.

Interac mobile app

Because this payment method acts essentially as a payment gateway or login system via bank identity through Canadian banks, there is no Interac mobile app for users to download and install. However, it is possible to use Interac on mobile devices across all operating systems for paying for goods and services.

Advantages and disadvantages of using the Interac payment method

Advantages

• Security: Interac uses multi-level security and can also be used for identity verification.
• Speed: transactions made using this payment method are usually completed within minutes.
• Simplicity: using this payment method is very easy and intuitive for users, with no need to create a new account or install an app.

Disadvantages

• Not supported everywhere: the Interac payment method can primarily be used within Canada or with merchants and service providers who have accounts with Canadian banks.
• Transfer fees: some transfers made via Interac may incur fees (e.g., Interac e-Transfer).
• Limited to Canadian banks: users must have an account with a Canadian bank that supports Interac to use it.

Evaluation

This payment method certainly offers many advantages to its users, such as faster, safer, and easier online payments with merchants and service providers, as well as personal transfers between different bank accounts. Users do not need to create any account to use Interac; they only need to have a bank account with a Canadian bank that supports this payment method. Disadvantages include the limited availability primarily within Canada and Canadian banks. Although Interac can be used outside of Canada, it is only possible if users are sending funds from a Canadian bank. Another disadvantage can be fees charged for services like e-Transfer. Overall, however, this payment method is highly rated and is one of the most popular payment methods used in Canada.

Frequently asked questions