.svg)
The opening of Canada’s new high-value payment system is another step towards the country's objective of modernizing its payment system and making it more adaptive to innovation.
On September 1, Payments Canada, the operator of Canada’s payment clearing and settlement system, inaugurated its first version of Lynx, a high-value payment system with which it wants to replace the country’s 20-year-old Large Value Transfer System (LVTS).
Lynx processes large, time-sensitive payments, such as wire payments, with “real-time settlement finality,” but it will also contain “enhanced cyber-security and resiliency capabilities” and is hospitable to interfaces (including application programming interfaces or APIs) and reporting software.
In a second phase, scheduled for late 2022, the organization plans to introduce the ISO 20022 message standard to support the introduction of new products and services and the digitization of manual and paper-based processes related to invoicing and payment reconciliation.
So far, 30 countries, including the U.S., Japan and the nations that use the euro, have adopted or are planning to adopt the global messaging standard.
Payments Canada will own and operate Lynx and the Bank of Canada will oversee it.
Lynx is part of the wider context of Canada’s great project to modernize payments. The reconfiguration of its high-value payment system is one of the main initiatives of the project, but it also plans to create a new, real-time system for smaller transactions, along with a new infrastructure for retail batch payments.
The real-time system, called Real-Time Rail, will start to operate next year. It will provide payments around the clock, all year round, that are final and irrevocable and will allow third-party developers to create new overlays or provide new payment services in line with it.
At the same time, Canada plans to rewrite the rules that govern payments of all types to accommodate the new infrastructure and aims to align its regulations with global “best practice” to facilitate global interoperability and make its payment system safer.
“The new system is a fundamental part of Payments Canada’s modernization journey and marks a major delivery towards a Canadian payments infrastructure that supports tomorrow’s digital world,“ Payments Canada said.
