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Interac e-Transfer (formerly Interac Email Money Transfer or EMT) is a Canadian funds transfer service between personal and business accounts in participating Canadian banks and other
financial institution A financial institution, sometimes called a banking institution, is a business entity that provides service as an intermediary for different types of financial monetary transactions. Broadly speaking, there are three major types of financial ins ...
s, offered through Interac Corporation. From inception until early 2018, the service was provided by Acxsys, a for-profit consortium backed by most of the major partners of the nonprofit Interac Association, and using the Interac brand under licence. In February 2018, the activities of both organizations were combined into a single for-profit organization under the Interac name.


Participating institutions

Most Canadians who use
online banking Online banking, also known as internet banking, virtual banking, web banking or home banking, is a system that enables customers of a bank or other financial institution to conduct a range of financial transactions through the financial institut ...
can send funds. These include personal
deposit account A deposit account is a bank account maintained by a financial institution in which a customer can deposit and withdraw money. Deposit accounts can be savings accounts, current accounts or any of several other types of accounts explained bel ...
holders with the
big five banks Big Five is the name colloquially given to the five largest banks that dominate the banking industry of Canada: Bank of Montreal (BMO), Scotiabank, Canadian Imperial Bank of Commerce (CIBC), Royal Bank of Canada (RBC), and Toronto-Dominion Bank ...
(
Bank of Montreal The Bank of Montreal (, ), abbreviated as BMO (pronounced ), is a Canadian multinational Investment banking, investment bank and financial services company. The bank was founded in Montreal, Quebec, in 1817 as Montreal Bank, making it Canada ...
,
Scotiabank The Bank of Nova Scotia (), operating as Scotiabank (), is a Canadian multinational corporation, multinational banking and financial services company headquartered in Toronto, Ontario. One of Canada's Big Five (banks), Big Five banks, it is the ...
,
CIBC The Canadian Imperial Bank of Commerce (CIBC; ) is a Canadian Multinational corporation, multinational banking and financial services corporation headquartered at CIBC Square in the Financial District, Toronto, Financial District of Toronto, Ont ...
, RBC, and TD), Desjardins,
Tangerine The tangerine is a type of citrus fruit that is orange in colour, that is considered either a variety of the mandarin orange (''Citrus reticulata''), or a closely related species, under the name ''Citrus tangerina'', or yet as a hybrid (''Citr ...
, National Bank, Simplii, PC Financial, EQ Bank and many
credit union A credit union is a member-owned nonprofit organization, nonprofit cooperative financial institution. They may offer financial services equivalent to those of commercial banks, such as share accounts (savings accounts), share draft accounts (che ...
s and other institutions, as well as some small-business account holders. In 2015, 105 million money transfers were sent using the platform totalling over 44 billion in value. Any personal account holder in Canada can receive funds.


Process

An e-Transfer resembles an e-cheque in many respects. The money is not actually transferred by e-mail. Only the instructions to retrieve the funds are. The sender opens an
online banking Online banking, also known as internet banking, virtual banking, web banking or home banking, is a system that enables customers of a bank or other financial institution to conduct a range of financial transactions through the financial institut ...
session and chooses the recipient, the amount to send, as well as a security question and answer. The funds are debited instantly, usually for a surcharge. If the recipient cannot be assumed to know the answer to the security question, the sender must communicate it separately. An e-mail or
text message Text messaging, or texting, is the act of composing and sending electronic messages, typically consisting of alphabetic and numeric characters, between two or more users of mobile phones, tablet computers, smartwatches, desktop computer, des ...
is then sent to the recipient, with instructions on how to retrieve the funds and answer the question, via a secure website. The recipient must answer the security question correctly. (If the recipient fails to answer the question correctly after three tries, then the funds will automatically be returned to sender.) If the recipient is subscribed to online banking at one of the participating institutions, the funds are deposited instantly at no extra charge. If the recipient's deposit account is not at one of the participating institutions or not subscribed to online banking at all, the funds are deposited within three to five business days, and a surcharge (currently $4.00) is deducted from the amount received. The Autodeposit feature allows senders to send money and be received by the recipient without the recipient having to answer a security question. The recipient must enable this feature in their account settings. Not all banks offer this feature. When an e-Transfer has not been accepted after a certain period of time, the transfer will not go through. The transfer duration depends on the bank and/or the person's settings. Some e-Transfers can be automatically cancelled after 24 hours or after a period of up to 30 days, depending on the bank / the user. Banks like TD, CIBC, and RBC have a set 30-day limit until an e-Transfer is cancelled, while other banks have shorter durations and set limits.


Benefits and disadvantages

Unlike a
cheque A cheque (or check in American English) is a document that orders a bank, building society, or credit union, to pay a specific amount of money from a person's account to the person in whose name the cheque has been issued. The person writing ...
, the funds from an e-Transfer are not frozen in the recipient's account. An e-Transfer cannot bounce, as the funds are guaranteed, having been debited from the sender's account immediately upon initiating the transfer. As long as both sender and recipient bank are participating institutions, the funds are sent and received instantly. However, in some cases, for example two people with different banking institutions, transfers may take anywhere between near instant, or up to a few hours for the receiving party to get their emailed notice. However, like any online banking mode of payment, e-Transfers are vulnerable to
phishing Phishing is a form of social engineering and a scam where attackers deceive people into revealing sensitive information or installing malware such as viruses, worms, adware, or ransomware. Phishing attacks have become increasingly sophisticate ...
. Many Canadians in areas where the Big Five banks have little presence or who do not bank online are penalized by a surcharge when receiving e-Transfers. Unlike a real giro, an e-Transfer requires intervention from the recipient for every single transaction, unless the recipient has signed up for Autodeposit. An e-Transfer goes stale much more quickly than a cheque (after 30 days, the e-Transfer is automatically cancelled, and the sender is notified by e-mail to retrieve the funds).


Security and privacy issues

In 2019 several articles published by Erica Johnson (CBC News) reported that e-Transfers had been intercepted and/or redirected via different means such as guessing security questions or impersonating e-Transfer customers. In many cases, the customers were not reimbursed. In the same year, a paper published on
arxiv.org arXiv (pronounced as "archive"—the X represents the Greek letter chi ⟨χ⟩) is an open-access repository of electronic preprints and postprints (known as e-prints) approved for posting after moderation, but not peer reviewed. It con ...
examined the security and privacy of Interac e-Transfer and came to the conclusion that "Standard e-Transfers are potentially insecure against redirections" and that "the platform fails to protect its customers' privacy" due to relying on technologies such as e-mail and SMS.


See also

*
Electronic funds transfer Electronic funds transfer (EFT) is the transfer of money from one bank account to another, either within a single financial institution or across multiple institutions, via computer-based systems. The funds transfer process generally consists ...


References


External links

* {{Online remittance Financial services companies of Canada Payment systems Banking in Canada Mobile payments