16/10/25
As of September 8, 2025, Canada’s Retail Payment Activities Act (RPAA) has come into force, introducing significant regulatory changes for Payment Service Providers (PSPs). The Bank of Canada (BoC) has begun publishing a list of registered PSPs and those whose applications have been refused, marking a pivotal moment in Canada’s financial regulatory landscape.
⚖️ Key Regulatory Framework
The RPAA establishes a comprehensive legal framework for the BoC to supervise PSPs, requiring entities to register if they meet prescribed criteria. PSPs that submitted applications by November 15, 2024, were permitted to continue operations during the transition period, which ends on September 7, 2025. From September 8, 2025, registered PSPs must comply with obligations related to operational risk, safeguarding end-user funds, and reporting requirements. Those with pending applications are expected to adhere to the same regulatory obligations but are exempt from certain reporting requirements until registration is finalised.
📊 Comparative Analysis
Similar to the European Union’s Revised Payment Services Directive (PSD2), the RPAA aims to enhance the security and transparency of payment services. However, the RPAA introduces unique elements, such as the requirement for PSPs to obtain pre-approval from the BoC for any change of ownership or control. This provision underscores Canada’s commitment to maintaining the integrity of its payment systems and protecting consumers from potential risks associated with ownership changes.
💼 Practical Implications
Entities contemplating mergers, acquisitions, or changes in control involving registered PSPs must navigate the BoC’s approval process, which includes reviews by both the BoC and the Minister of Finance. The BoC has up to 45 days to determine whether to refuse an application once deemed complete, while the Minister has up to 60 days, extendable by additional periods, to review applications that may raise national security or financial system integrity concerns. Failure to comply with registration requirements can result in monetary penalties of up to $1,000,000.
🔍 Conclusion
The implementation of the RPAA represents a significant shift in Canada’s approach to regulating payment services, emphasising security, transparency, and consumer protection. PSPs and entities involved in the payment services sector must ensure compliance with the new regulations to avoid potential legal and financial repercussions. For expert legal guidance on navigating the RPAA and its implications, contact NUR Legal. Visit us at NUR-Legal.com or contact us directly at info@nur-legal.com
Kätrin Särap