Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Banks Retreat From Payments as Moneris Sale Looms
Payments | Aug 21, 2025
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RBC, BMO and TD Retreat From Merchant Services Ahead of Payments Canada’s Real Time Rail Modernization
Two of Canada's largest banks, Royal Bank of Canada (RBC) and Bank of Montreal (BMO), are exploring the sale of their jointly owned payments company Moneris, with reports valuing a potential transaction at about $2 billion.
At the same time, TD Bank recently agreed to a managed services agreement with Fiserv that transfers part of its merchant acquiring operations to the global payments giant.
Both of these moves come as Payments Canada continues its long delayed modernization of national payment rails through the Real Time Rail (RTR) project, raising questions about whether banks are pulling back because they expect the next era of payments to be too competitive to dominate?
Moneris on the Block
According to Reuters, RBC and BMO have hired advisors to explore strategic options for Moneris, which processes roughly one in every three business transactions in Canada. The company serves more than 325,000 merchant locations and generates close to $700 million in annual revenue. A $2 billion sale price would represent just under three times annual revenue. The sale is not guaranteed but the willingness of the country’s two largest retail bank giants to consider selling such a large processor sends a significant signal to the market.
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TD has already moved. In July 2025, TD bank announced a partnership with Fiserv that hands over part of its merchant services portfolio covering about 30,000 locations. Under the deal, Fiserv will provide Clover terminals and software to TD business clients while the bank continues to bundle merchant services with its other cash management products.
Merchant acquiring has become a most costly business. It requires constant investment in fraud detection, cloud based platforms, omnichannel integration, and new software features demanded by merchants. Reuters reports that rising operational costs is one of the main reasons banks in North America are exiting.
In Canada, Scotiabank already relies on Chase Payment Solutions, while National Bank offers services through Global Payments Direct and Global Payments Canada GP. If RBC and BMO complete a sale of Moneris, it would leave Canada’s major banks primarily as distributors of third party solutions rather than direct operators of merchant networks.
RTR Delays and the Modernization Gap
Meanwhile, the backstory is Canada’s ongoing attempt to modernize its core payment rails. Payments Canada first announced the Real Time Rail system six years ago, back in 2019. The latest target after multiple delays puts a full launch in 2026. See the Payments Canada RTR update.
As of mid 2025, Payments Canada reported that the build of RTR was more than half complete and that fraud and risk services were being finalized. The extended timeline has frustrated many fintech firms, who argue that delays have deprived them of a level playing field, forcing many to rely on bank intermediaries to access outdated payment infrastructure compared to international peers.
See: Canada’s Retail Payments Boom: $11.9 Trillion Growing Fast
The timing raises an important question. Are banks divesting from merchant acquiring because they believe RTR and related regulatory reforms will make it harder to compete? Once RTR launches, it will enable account to account payments that bypass cards altogether. Combined with new oversight of payment service providers under the Retail Payment Activities Act, fintech companies and non bank players will be able to compete more directly in the payments market.
What this Means for Fintechs and Merchants
For fintech companies, a Moneris sale and further bank exits would open the market to new partnership models. Global processors are typically more open to technology integrations, allowing fintech firms to bundle services such as inventory, ordering, analytics, and embedded finance directly into merchant solutions.
For small businesses, the implications are practical and immediate. Terminal availability, dispute handling, settlement times, and bundled services will matter more than whether a bank or a processor owns the network. Over time, competition from regulated payment service providers and the availability of RTR could bring down costs and accelerate innovation.
Outlook
Canadian banks appear to be repositioning away from running payment networks and toward acting as distributors of third party services. Payments Canada’s modernization delays bought them time but once RTR is live the pressure from new entrants and new business models will be more intense.
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The outcome will determine the structure and new players of Canada’s acquiring market, as well as how quickly merchants and consumers gain access to faster, cheaper, and more flexible payment options. For fintech innovators, the real opportunity may not be in who owns Moneris but how a more modernized system will impact a more competitive and growing field.
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