Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
New Bank of Canada Case Scenarios for Retail Payments
Payments Regulation | Oct 3, 2024
Image: Freepik
Bank of Canada Adds 7 More Scenarios to Help Companies Understand Registration Triggers Under the New Retail Payment Activities Act (RPAA)
On October 2, 2024, the Bank of Canada (BoC) published a new collection of registration examples to assist payment service providers (PSPs) in understanding the implications of the new Retail Payment Activities Act (RPAA) and whether or not they need to register with the Bank of Canada. These include:
- Acquirers
- Card program managers
- Cloud Computing
- Holding Funds
- Lending
- Marketplaces
- Services Backed by Cryptocurrencies
New Case Scenarios
1. Acquirers
What acquirers do and how their job fits into the RPAA are explained in this example. Companies known as acquirers assist businesses in processing payments, most frequently via credit or debit cards. These companies must comply with certain regulations under the RPAA if they engage in activities like keeping money for merchants.
2. Card Program Managers
Businesses that design and oversee payment card systems, such as digital wallets, prepaid cards, or gift cards, are known as card program administrators/managers.
See: Guide: PSP Registration with Bank of Canada (RPAA)
With an emphasis on identifying "incidental activities" that need to comply with the Act, the updated scenario provides examples of what actions are covered by the RPAA.
3. Cloud Computing
The RPAA regulations may also apply to cloud computing companies that facilitate payments, such as by assisting in the initiating or authorizing electronic money transfers.
4. Holding Funds
This situation applies to corporations that keep money for their clients, such as those that hold money in accounts or digital wallets prior to a payment. To help PSPs understand when they must comply with the Act, the Bank of Canada clarifies what actions are considered "holding funds" under the RPAA.
5. Lending
The new lending scenarios concentrate on businesses that give customers credit or loans. It describes which payment tasks, such as managing funds or collecting payments, are protected by the RPAA and which are not. Knowing whether their operations are incidental or subject to PSP requirements is important for lending firms to understand.
6. Marketplaces
It's possible that marketplaces, such as online platforms that link buyers and sellers, are engaging in the scope of RPAA activities.
See: BoC Conducts Mock PSP Registration Ahead of Nov 1, 2024
This scenario explains how RPAA compliance may be necessary for specific marketplace operations including maintaining digital accounts, allowing payments, and keeping cash for users. This helps marketplaces comprehend its regulatory responsponsibilities if it handles money or facilitates payments.
7. Services Backed by Cryptocurrencies
These scenarios are designed to help PSPs that provide crypto services like digital wallets, crypto transfers, and payment facilitation to understand their RPAA responsibilities. The Act requires registration and compliance for activities such as keeping money on behalf of users, initiating electronic transfers, and allowing or sending payment instructions. The BoC highlights that although crypto functions differently from traditional payment methods, their usage for retail payments is still governed by the same regulations. To ensure compliance and improve customer protection, crypto-related PSPs must assess their situation and comply accordingly.
Why These Scenarios Matter
The Bank of Canada's new scenarios are intended to assist PSPs in determining if their services are covered by the RPAA and what steps they must take to comply. These scenarios are an excellent tool for figuring out if you must register with the Bank of Canada and what regulations you must comply with if you run a business in any of these sectors.
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