22 May 2013

Canada's Interac looks to go for-profit - report

08 September 2008  |  6667 views  |  0 credit card chip

Canada's national payments association Interac is in talks with the country's competition bureau over plans to become a for-profit organisation, according to local newspaper the Globe and Mail.

Interac was set up in the mid-1980s by a group of banks and Desjardins Group. In 1996, following concerns that it was abusing its power, the association inked a deal with regulators that stipulated it must be managed on a not-for-profit basis, only charging fees to cover costs.

However, the Globe and Mail says the association is now looking to restructure to fight off increased competition from credit card companies like Visa, which are entering the debit market in Canada.

Interac's CEO Mark O'Connell told the daily the group is talking to the the competition bureau to amend the consent order to help it compete with rivals.

A decision on a new structure has not been decided and all options are open, including the possibility of an initial public offering, he told the paper.

O'Connell says the group is worried it might be left behind by firms like Visa and MasterCard, especially with the growth of contactless and mobile payments. He also cited alternative payments options such as PayPal as a threat.

Interac seeks shift to for-profit status - Globe and Mail

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