AGREEMENT WITH FEDS OPENS UP INTERAC
By Adnews Staff
Interac Association is now open for business to anyone who can meet technical and security standards. This means that retailers and insurance companies, among others, could make use of the Toronto-based electronic banking system that until now has been controlled by the top six banks, Canada Trust and two credit union associations. This could broaden the range of services offered through Interac and increase the number of sites where it is available. Retail operations, such as supermarket chains, will no longer be obliged to use Interac equipment to allow customers to to pay at the check-out counter with bank debit cards. The retailers will be allowed to install their own systems, which could prove cheaper for them. Interac provides a network of automated banking and debit card machines across Canada which allow people to draw money out of bank accounts or make payments at stores without using cash. According to the federal Bureau of Competition Policy, Interac has shut out competitors with restrictive membership rules and high fees. After receiving complaints, the Bureau launched a two-year formal investigation. Recently Interac agreed to a settlement, in the form of a consent order, which must now be approved by the Competition Tribunal. Membership criteria will be broadened under the consent order. All parties will be able to hook up directly to the network instead of through one of the founding institutions, and new members will be able to increase the number of services offered without having to obtain the approval of the nine charter members. Interac was founded in 1984. Its ad agency is Montreal-based BCP.