Donna Kinoshita – Payments Canada: All about the new Real Time Rail [Season 2 | Episode #26]

Podcast Intro 00:00:01 Hello. Welcome to P.I.T. Exchange, a podcast by Currency Research. Join us as we discuss the latest in payments, innovation and technology with the industry’s most innovative thought leaders. Today’s payments are changing and moving around the world faster than ever before, and P.I.T. Exchange gives you the knowledge and insights to keep up. Sit back and relax as we join Currency Research, exchanging ideas with today’s special guest.

Jens Seidl 00:00:32 Welcome to another episode of The P.I.T. Exchange. P.I.T. Exchange is payments, innovation and technology. My name is Jens Seidl, and I’m your host for today. And it’s my pleasure to welcome a very special guest from Canada today, Donna Kinoshita with Payments Canada. Welcome, Donna.

Donna Kinoshita 00:00:50 Thank you very much for asking me to join you. Great to see you again.

Jens Seidl 00:00:54 Likewise. And pleasure having you with us, Donna. As usual with my episodes, I’d like to start with the three personal questions, just to get to know the person done a little bit better. Before we jump into the work related topics, you are up for that.

Donna Kinoshita 00:01:07 Absolutely. Can’t promise there’ll be good answers, but.

Jens Seidl 00:01:12 All right, well, the first one is a very easy one to to get going. A tea or coffee?

Donna Kinoshita 00:01:17 Oh, it’s not that easy a coffee when I’m in North America. And oddly enough, when I go to the UK or Europe, it’s t.

Jens Seidl 00:01:25 Okay, well, UK, I can relate. Absolutely. I love the the tea in Great Britain, but Europe I’m not so sure. But anyway. Fine. Okay.

Donna Kinoshita 00:01:34 Good copy. Well, in Europe.

Jens Seidl 00:01:36 next question. what is your favorite season?

Donna Kinoshita 00:01:40 Oh, these are not easy.

Donna Kinoshita 00:01:42 And, you know, part of the reason I always say that I, I’m born and bred in Toronto, Canada. I love all four seasons. And you have to to live in Toronto because the summer is so short, you can’t say it’s summer is your favorite. But I guess if I had to pick the one of the four fall is beautiful in Toronto in particularly a little bit north of Toronto where the cottage so.

Jens Seidl 00:02:05 And the last question movie or TV show that you might have watched recently or a long time ago, doesn’t matter that you would recommend to people.

Donna Kinoshita 00:02:13 Oh, goodness. Sadly enough, it is going to be kind of a commercialized movie, but, recently saw the F1 movie in the theaters. I love big screen, I love going to the theaters, and it was kind of one of the popular films this summer and shockingly, actually pretty good.

Jens Seidl 00:02:32 All right. Yeah, I’ve always seen the previews entertainment value.

Donna Kinoshita 00:02:35 How’s that?

Jens Seidl 00:02:36 Yes. Nothing wrong with that. I mean, it’s an entertaining medium, so, No. And I saw the previous. It does look really good, but I didn’t get a chance to catch it in the theater, so, that’ll go on my list.

Donna Kinoshita 00:02:49 Yeah.

Jens Seidl 00:02:51 Great. All right, well, now let’s talk about, business. and maybe I’ll let you start with introducing yourself. And tell us a little bit about what you do at Payments Canada and how you got there and what you’re working on.

Donna Kinoshita 00:03:04 Yeah, super. Well, thanks for that. So as you know, I’m the chief payments officer here at Payments Canada. A lot of folks will say to me, Donald, what does that mean? what does the chief payments officer do? So, under my remit, I would have government relations and industry relations. So most of the outward facing interactions and relationships, that would include members, regulators, stakeholders, it’s the whole gamut of the ecosystem. Also under my purview is product management, marketing and communications, policy roles, research. So it’s fabulous because I think about it as it’s most of the front of the house, if you will, accountabilities. but it really keeps, you know, you very grounded and close to the market. So I hope you enjoy and enjoy the role very much here. I’ve been here over just over two years. Heard of that? Most of my career has been in the financial services and kind of technology realm. when I say technology, I don’t mean that I no means am I a technologist and or can I code, but certainly, technology from our perspective, how to leverage it, how to commercialize technology, how to bring it to the market and the most, responsive and addressing, I guess, the market’s needs and in the best responsive way.

Donna Kinoshita 00:04:28 I would say throughout my career, whether that’s being with a large financial institution, whether it’s been with a small startup, worked in a benchmark. I worked for Global Organizations Network. So pretty much you can almost say, I’ve lots of day in the life of somebody’s shoes career in terms of the things that represent you.

Jens Seidl 00:04:49 Excellent and great. Yeah, well, technology is in the title of our podcast as well. and I think that makes payments so interesting as well, that there’s so much change being driven through modern technologies, and there’s so much more coming now with AI in the pipeline and so many other things. So it will definitely keep all of us busy, no doubt about that.

Donna Kinoshita 00:05:09 Absolutely.

Jens Seidl 00:05:10 Great. Well, let’s talk a little bit about what’s happening in Canada. and maybe start with the geopolitical questions and some of the background. You just had a new prime minister being elected who is an ex central banker. So how has that impacted the payment landscape in Canada? Has it made any difference, and what are the kind of trends that are currently happening?

Donna Kinoshita 00:05:32 Yeah, it’s a fabulous question.

Donna Kinoshita 00:05:34 And it was with much anticipation that we most recently had the election a little while ago happy that, the general outlook, if you will, on Prime Minister Carney is, I would say often I hear folks, say cautiously optimistic. And I would say that my own personal views as well. You know, we we’re seeing we’re hearing great, objectives in terms of promoting innovation, competition, creating that economic growth and prosperity for all Canadians. And that marries so well to, you know, pain in Canada as an entity. What we’re trying to achieve here on behalf of our members, the stakeholders, our regulators. So we’re quite excited with the new, government. And, we see things moving along quite quickly, which sometimes, you know, you can see, government moving along quite quickly. Sometimes they’re an oxymoron. But I’m happy to say in this case, we are seeing things, move along. An example being, changes or amendments to our Canadian Patents Act. We’ve been working so hard, so diligently on that to expand our membership to include PSP and those.

Donna Kinoshita 00:06:49 Great. And it’ll be great consumer grade to the market. And happy to say we’re hopefully very close to that finish line, if we will. We expect very similar to the next couple of weeks, that the changes to the act will come into force, hopefully by the end of the month or soon thereafter. So very exciting times for those stakeholders who have been waiting to become members of the payment in Canada. Along with that, today, actually September 8th, the Retail Payment Activities Act come into force. The RPA. And that’s kind of the regulatory oversight, if you will, over these SPS. It’s the Bank of Canada has that mandate to oversee them. And that ensures that not only are we embracing the entrance of these new members, but also ensuring the safety of them continue.

Jens Seidl 00:07:48 Okay, that’s good news. And maybe for those that aren’t too familiar with how regulation works in or payment regulation specifically as well works in in Canada. Are there any other bodies that are involved with that, or is it really mostly the Bank of Canada that regulate the payments landscape?

Donna Kinoshita 00:08:04 So the oversight is largely performed by the Bank of Canada, but certainly the bigger the oversight body over all of us in finance, the Department of Finance, as well as the Minister of Finance, without legislative oversight, but the actual regulatory body and or most closely with the SPS would be that the Bank of Canada.

Donna Kinoshita 00:08:27 PA.

Jens Seidl 00:08:28 Okay. Understand? Great. Thank you for that. And maybe let’s talk a little bit about one of the big, big projects that Payments Canada is working on at the moment, which is the implementation of a real time payment rail. Can you give us a bit of an update on where you are now with this, this project?

Donna Kinoshita 00:08:46 Yes, I’m happy to. We’re very excited again. Things are moving along very well and happy to say quite quickly. You know, one of the things in Canada we’ve enjoyed as a community. We do have foster P2P foster paintings. It’s taken the form of interact, one of our beloved community utilities in the market that does, you know, from a consumer perspective, provide foster P2P transfers. What the RTR will do is allow that real time clearing and settlement of those transfers now, and also provide a platform for those new members of SPS to create additional consumer experiences. Great innovation, on a direct to exchange basis, all real time. So where are we now? Happy to say we’ve completed the technical bill, the last little piece that we needed in the cog of the wheel to have a complete real time exchange and clearing and settlement platform.

Donna Kinoshita 00:09:54 And now that heavy work, as everybody goes through the testing to make sure that the, you know, safe, sound resilient. We’re very lucky in Canada. We offer a very collaborative environment. we have a whole ecosystem engaged in those texting endeavors. And, you know, we’ll go through all of the operational readiness testing, the UAT, user acceptance, the site testing. we’ve even added an extra layer of industry assurance testing before we go to that end, to end testing in all of the security, and, certification needs to happen. But suffice it to say, right now, we’re the furthest along the project has ever been. So the team proud of that. And again, that was with a Team Canada effort.

Jens Seidl 00:10:42 I can imagine it’s a massive undertaking during this this kind of implementation. And and when you talk about collaborative approach to this, how far does that go. Is this including. Well, certainly the banks I imagine. But is it also including merchants and consumers. What’s what’s the the whole scope of that testing effort that you’re facing now?

Donna Kinoshita 00:11:02 Yeah.

Donna Kinoshita 00:11:02 So the throughout the whole project, not just testing but the build, the requirement, the rules and the policies that go along with the whole RTR, the real time rail. It’s been a truly collaborative endeavor. So yes, our members obviously the big and small global domestic, we’re very fortunate to have a stakeholder advisory council. We we finally referred to as the fact they that include stakeholders that may be new participants joining, but also we have several representatives that make sure we are always considering the consumer perspective. Our regulators are highly engaged in the whole effort and of course, our our, our vendors. It was a key learning a number of years ago that this is far too meaningful and too big to just be represented by any one stakeholder. And so it was a truly a collaborative ecosystem network. And it will continue to be you know, we won’t get through the testing without this. We won’t finalize all of the rules and policies without that ecosystem.

Jens Seidl 00:12:13 Yes. And we’re right in saying that the new rails are now going to run in parallel with the existing rails like ACH system, the RTI system, and it’s going to be a completely new infrastructure that you’re building in parallel to what’s already there.

Donna Kinoshita 00:12:27 That’s correct, that’s correct. So today we currently own and operate the we expect that, in, you know, the retail payment infrastructure, if you will, and the G GS, which we referred to as links, will continue to own and operate both safe, sound, Resilient platform and concurrently launch the latter.

Jens Seidl 00:12:50 It’s a discussion we often have at our conferences that it seems to be the way in payments, that we constantly add more experiences, more systems, and hardly ever retire anything. Take the US as a prime example, with still a substantial number of checks still being used. Is that also what you expect to to happen in Canada, that this will keep running in parallel? Or can you already see that some of the existing systems are probably nearing their end of life, and might actually get retired at some point in the future?

Donna Kinoshita 00:13:24 Yeah. So it’s a great question. And I, you know, listen, we’re working on that right now. So now that we are feeling more confident in the path forward of the RTR and the ecosystem is well aligned in terms of what next needs to be done, we are, you know, really considering that longer term perspective in what do those growth knots individually for those platforms look like? Do those roadmaps converge at some point in time? Does that convergence necessarily mean part of or completely some might be retired? Those are exactly the question.

Donna Kinoshita 00:14:04 But you know, yeah, it does beg the question of the when is the right time where you focus or optimize your investment. in particular, you know, if we operate in a commercial environment, I’d be saying what our zero product, where we’re doubling down and where might we be thinking down the road of retiring that kind of, you know, that’s a five, ten, 15 year roadmap perspective that we’re looking at. The other balancing act to that, like Payments Canada, one of our core mandates is observing public policy objectives and what are the social benefits that we always need to consider. So inclusion comes to mind. We need to provide choice and access. So it’s always a balancing act of the how do you optimize the number of infrastructures, platforms that you run, while keeping in mind that you don’t want to at the mercy or at the cost of inclusion? Right.

Jens Seidl 00:15:06 Absolutely. Yeah. And another question on the on the commercial side of the new system, have you already decided or have the the banks that offer the service as well decided how that service now is going to be priced? Is that different from what’s already in place? Is that still a decision that needs to be taken? Where where are we with regards to that process?

Donna Kinoshita 00:15:27 Again, those are some of the principle that we’re working through right now with our members and the ecosystem.

Donna Kinoshita 00:15:35 You know, what are some of the core principles in our pricing. We are hardening our cost base that we will, which at the not for profit is a good indicator of where the price is going to end up being. But we’re going through those principles right now in terms of how you translate the pricing principles and into actual pricing schedule. Yes, it’s always to be globally competitive and as cost effective as. So how do we actually exemplify that?

Jens Seidl 00:16:09 And I guess that can be a challenge. And we’ve seen that. I live in Germany. We’ve seen it in Europe where when faster payments were implemented, most banks offered the service at a premium. So you had to pay an extra charge, typically around €1, to make a faster payment. And then the regulator later actually stepped in and said, no, you cannot price this differently. So there’s now a big debate between the commercial sector saying, well, we invested a lot of money in this new infrastructure. How are we actually going to monetize this if we’re not allowed to charge a different fee? So it’s it’s not I mean, if the the first three question I asked should and that episode were difficult, that’s a much more difficult one.

Donna Kinoshita 00:16:50 Yeah. So yeah it’s a great question. As Payments Canada, what we can do as the first step in all of that is and you can share the cost out to our members to the market is as low as cost effective as possible. It’s globally competitive without sacrificing that safe, sound resiliency of the platform. And then, you know, the next question to your point would be, how do our members and officials capitalize and commercialize on those capabilities? So again, you need to work with our regulators and the ecosystem in terms of that next step. But as an initial it’s how do we stay globally competitive from a costing perspective.

Jens Seidl 00:17:33 Excellent. Now that makes perfect sense. And global competitiveness is actually a very good segue to my next question, because obviously now the new system will also open up new connectivity to the rest of the world. Right. So for cross-border payments, they are now new opportunities with a faster payment rail to connect to other existing faster payment rails. And I believe you also ensure that the new system is of course ISO 20 or 22 compatible.

Jens Seidl 00:18:01 So what is the future there? What next steps can you already envisage in the cross-border space?

Donna Kinoshita 00:18:07 Yeah. So obviously to cross-border is one of our primary use cases going forward. See the RTR is laying that groundwork for the ability to have better, faster, quicker, cheaper, if you will, right. Cross-border payment. I’m happy to say once we have mobilised much of the majority of the volume onto the RTR clearing and settlement platform, so, you know, greater than 90% chlorine settling on it. We will have enabled inbound final mile cross-border transactions onto the RTR. So very excited about that. You know, probably one of the few jurisdictions who will do it early in terms of, going live with their writers, and then we will turn our gaze into what’s the most efficient and effective way, again, that cost effective way for the end members and users of enabling outbound global cross-border transactions. As you know, there’s a number of ways you can do that. And so we’re in that analysis period right now.

Donna Kinoshita 00:19:16 But suffice it to say and then go will be to enable that. You know, one of the things we need to consider is how fast would we want to move on that? Is it faster to enable 1 or 2 corridors almost as proof points, point? Or do you go for the kind of ubiquitous coverage model that might take a little bit longer? Again, as you know very well. The, it’s the regulation, the rules and the policies that are kind of the devil is in the detail. The technical aspect, I think is the easiest part to figure out. It’s the follow on, regulatory environments that we need to make sure also move in concert. So all that just say cross-border is one of the top priority use cases to enable. And we’re evaluating right now what might be the best possible initially for a case.

Jens Seidl 00:20:07 No. Absolutely. And look I think you hit the nail on the head there. One approach could be to join existing platforms that are already grouping together. Nexus have just launched their their new platform now as an operational or building the operational platform and got an entity created.

Jens Seidl 00:20:27 You’ve got the Middle East with Buna for instance. There’s so many other opportunities to. To interlink with. That’s one approach. But you mentioned corridors. Can you tell us a little bit what the main corridors are, where a lot of the cross-border traffic is going? I would imagine Canada, US must be one of the most obvious ones.

Donna Kinoshita 00:20:46 It is for sure the main trade corridors Canada in the US. And you know, if you’d asked me five years ago, four years ago, it would have been a, you know, excuse the phrase a no brainer in terms of if we were trying to isolate to one quarter. Obviously, with the current geopolitical environment. The good news is our eyes have been opened in terms of what is the art of the possible and what might or should we be considering in terms of other possible high traffic corridors? A lot of it, you know, we analyze and where’s the biggest trade B2B corridors versus there’s significant consumer cross-border payment. And if that were the main use case we wanted to enable, it might be a different first corridor we will look at, but it won’t be surprising to you.

Donna Kinoshita 00:21:32 I mean, Europe, UK, India, Southeast Asia, right? So no surprises in terms of what quarters we’re considering and what are the pros and cons between, you know, trying to enable a Nexus application versus a 1 to 1? Let’s just get a concept.

Jens Seidl 00:21:54 Yeah, that makes perfect sense. And I guess reading between the lines and what you just said there, it sounds as if you’re also looking at all the different market segments. So from consumer remittances to corporates, they want to settle their bills across in other countries. Is that the case?

Donna Kinoshita 00:22:11 Yes, absolutely. So I think the other thing that we’re becoming much better at focusing on is outcomes. So not just enabling the platform, but also considering what kind of impact can we make, what kind of economic impact can we make for Canada and all Canadians. And so when you think of it, without lens, you start to segment your market. What are your objectives and outcomes that you’re trying to achieve in the specific initiative so that you can you can get there faster, better, cheaper for right that particular segment in that particular use case.

Jens Seidl 00:22:48 Absolutely. And of course, it’s also in line with the the G20 roadmap and the CMMi initiatives to improve cross-border. So it fits perfectly into that exactly. Well, let’s go beyond cross border then, and also talk a bit more about what possible new user experiences we might expect to see built on the back of those new rails. Are you already thinking about what kind of things could be happening in that space, and also how you can help with enabling the development of these new user experiences?

Donna Kinoshita 00:23:23 Yeah, absolutely. It’s a great question. So one of the advantages we have is being able to do our, you know, jurisdictional, research in terms of lessons learned. And if there’s anything we’ve learned just because you build it doesn’t mean that it will just come. You will. So we have put a lot of effort in terms of what are some of those priority use cases that, you know, when we’ve launched, who might we be able to work most closely with? To your point, how and you know what respect.

Donna Kinoshita 00:23:55 Probably mostly from an educational perspective in terms of here are the capabilities. And here’s let us help you in whatever way we can of educating how to bring those use cases to life. So we would always still work with our members, with the ecosystem in terms of them bringing those end user experiences to market. But what we have found is the more you know, someone like opinions candidate can work closely with them and provide them with the Information, hand-holding, whatever business chasing that they need to support those use cases. So we’ve identified, you know, maybe 6 or 7 priority use cases that we scoured in other jurisdictions, what has worked well, and then, you know, kind of overlaid those in Canada, would they work? Why would they work and what would it need to work? So immediately, you know, the consistent ones that pop out that, gig economy wage so your earn wage access those classic use case of Uber driver who wants to get paid for the three hours they just worked at a place where they can fill the tank with gas.

Donna Kinoshita 00:25:04 How do we really bring that to life? So everybody hears that use case, but how does that actually happen? And what do the enablers need to do to make that happen? And we feel like that’s where we can best lend assistance in terms of helping educate. Here are the parties that need to be involved in bringing that these case to life. And here’s what would need to change or be augmented or capabilities such that that can actually happen. Some of the other ones that we see are immediate, opportunities that instance any merchant settlement. How might we help enable that the need of me account transfers, how do we help consumers who have a trading account with one institution and maybe their checking account and another, and they want to make that trade instantaneously today? They actually can’t do it easily. So how can we remove help remove that friction? How do we work with those institutions to be able to offer that capability right away, the immediate funding. So in Canada, as I’m sure in other jurisdictions, you know, if you go buy a car and you’re going to use financing, it can be a little bit of a painful experience of of waiting to get your, you know, approval of the funding, then having the funding happen and being able to actually then transact on that, finalizing the car purchase.

Donna Kinoshita 00:26:35 So how can we help the providers in that chain, you know, remove that friction? And what kind of tools can we provide them in that regard? Government disbursements skiing quasi regulator, if you will, or closely obviously governed by finance and and the Bank of Canada. We would love to see many of those government disbursements be moved on to the real time rail. You think of emergency relief funds and just the social benefit of those moving into real time payments. So yes, we do have our favorite use cases that we are immediately, we’ll immediately start to look for key partners to get proof points and market as soon as the chair launches?

Jens Seidl 00:27:21 Yes, that. Well, that sounds super exciting. And I think what’s what’s also interesting, but probably not surprising, is that all of these use cases are not really focused around retail point of sale payments or e-commerce payments for that matter, because I guess you’ve got a very healthy card payment infrastructure and there’s little benefit in reinventing that wheel. Is that fair to say?

Donna Kinoshita 00:27:44 Yeah, absolutely.

Donna Kinoshita 00:27:45 Absolutely. So our objective is to make the pie bigger, not to just be shifting, within the pie, if you will. So continuing to encourage that innovation and new capability, if you will, new experiences.

Jens Seidl 00:28:02 Yes. But is there also I guess it’s different because we’ve seen the QR code payments taking off in Asia so much because the card infrastructure wasn’t as prevalent in many of those markets where that happened. But is there also a niche in Canada where, say, on markets or places or I don’t know whether street food is a big thing in Canada. I haven’t experienced it personally when I was there. Are there some places like that as well, where you think merchants will find it easier now to accept payments going forward, because they don’t have a point of sale terminal to accept card payments, or as it already been taken care of?

Donna Kinoshita 00:28:39 Oh, you know, I think there’s always an opportunity. So the one thing for sure that Canadians love is they love choice, which is, you know, going back to your earlier question, probably, probably why we have proliferation of choices in terms of how we like to pay.

Donna Kinoshita 00:28:53 But absolutely, I think there’s a niche market for QR codes. Certainly, Canada is probably one of the most highly penetrated bank and carded, if you will, jurisdictions. Canadians love the rewards, and those rewards are very rich in some cases on the card products. So, you know, there will be a segment that always will use their card. With that, there will always be merchants who are looking for lower cost of acceptance. And so it does. QR codes do provide that opportunity and alternative to provide to their end. Consumers of that might allow facilitation of lower cost of acceptance for the merchants. So absolutely we see that potential. And like you said there, well, street vendors aren’t maybe as prevalent as they might be in some other parts of the world. But certainly we do have our food trucks and things like that. So absolutely, we see that as a use case going forward.

Jens Seidl 00:29:54 Rate and it wants to meet feels like we’re almost going full circle back to where we started. Now, when you talked about the the new regulatory changes in Canada and allowing new parties now to access the payment systems.

Jens Seidl 00:30:09 That sounds to me like that must also be a good thing in driving innovation and allowing. With all due respect, my impression, at least in Europe, is that commercial banks aren’t always the best to come up with revolutionary new user experiences. Those other parties may be a bit more agile in being able to do that kind of thing. But I don’t need you to confirm that. But am I on the right track or wrong track there? What do you think?

Donna Kinoshita 00:30:35 Yeah. Listen, I think it’s a fair comment. We certainly hope. I mean, that is kind of the. Without sounding coy, the whole point of allowing these new entrants to become members and join the payments ecosystem. Having said that, you know, and having worked at a fintech, it’s not easy to break into a large market. And so while they will bring their innovative and experiences, what we also hope it will do is spur and inspire some of our larger members to also infect in and bring new, innovative competitive choices for consumers.

Donna Kinoshita 00:31:15 So I think we hope that, you know, it’ll be a classic rising Tide story where a rising tide floats all boats. So not just fintechs, but also, you know, our more larger traditional faces. Everyone will be inspired to build on the platform that our baskets experience exploiting consumer businesses.

Jens Seidl 00:31:40 Absolutely. No. I’ll completely agree with you. I’m conscious of time and we will have to wrap up pretty soon. But before we do, I just wanted to ask one more question around some of the the recent well, I’m saying noise almost that we, we hear around stablecoins and some on the extreme end of the spectrum saying, well, all of this is irrelevant because everything’s going to run on stablecoins soon and forget your legacy payment systems. It’s all going to be this brave new world. but what are your views on what’s what’s happening with stablecoins? Is it something worth looking into. Is it something that you believe will make a massive difference? What’s what’s your current outlook on that?

Donna Kinoshita 00:32:19 It’s a great question.

Donna Kinoshita 00:32:20 And you’re right, a lot of noise if you will. And market right now on stablecoin. You know listen it’s always been kind of something we have obviously kept an eye on for the last number of years. Most recently, I think much like many other jurisdictions with the passing of the genius act, it’s obviously wasn’t very much to the top of our consideration. I will say, listen, as I had started, Canadians like to have painting choices. So I if you know, we would be foolish to believe there will be some level of adoption of Bitcoin in Canada. We don’t believe overnight that there will be, you know, massive adoption. The use cases just don’t sustain it right now. But you know, again the perspective is but that will won’t necessarily always be the case. There are going to be use cases, customer segments, demographics that are going to emerge where stablecoins might make sense, and if so, what we would position, if you will or or pose is probably some kind of regulation in Canada is, when you think about it, from a national payment sovereignty perspective, and particularly in our position that we’re in right now of a geopolitical perspective.

Donna Kinoshita 00:33:44 I think, again, it would be prudent for us to be very mindful of how might stablecoins grow or not, particularly in our market. And what would that mean to one, our ability to have transparency, fiscal and monetary policy ability over our currency. And, you know, when you think about the essence of all of the what we just talked about, the enforcement, the focus, the collaboration around bringing the real time rail to market. It would be a shame if we didn’t maximise and optimise the usage of that investment that’s already happened in a better, faster, cheaper payment rail and have that slip away, that opportunity to a whole nother stablecoin. To me, that’s an opportunity for the market to see real economic growth immediately.

Jens Seidl 00:34:38 So yeah, no, that sounds like a very balanced view. And I think there’s also still some underlying potential issues with stablecoins that need to be addressed first, because before it can grow a lot further, because again, then otherwise we might introduce new instabilities and repeat mistakes that have been made before.

Jens Seidl 00:34:56 And that’s the last thing that we need.

Donna Kinoshita 00:34:58 That’s right.

Jens Seidl 00:34:59 Yes. And one more question, if I may, because we’re talking about the technologies and new exciting things. What do you think is going to happen with AI and specifically a genetic AI, Do you think we’re going to get there soon? That I will have my payment AI agent that I can just tell. Make a payment to Donna. It needs to be there in two days. Make it as cost effective as possible, or I’ll just drag and drop my my invoices to that agent, and it will take care of it and make the payment when it’s needed and at the the most effective way. Do you think that’s in the near future or does that sound super utopian?

Donna Kinoshita 00:35:36 So I will say this is a Donna perspective, you know? But listen, yes, I always describe myself as I’m not that as a consumer, the pure consumer, not as a Pinkerton, an employer or the business person as a general average consumer. I would say I’m I’m not an early adopter.

Donna Kinoshita 00:35:54 You know, I’m kind of a nice, if you will, adopt your math influencer. So I share that because as an example, I just booked my side bus. I booked in the trip. I’m going to do a little bit of sightseeing for all with AI. And I will say, as a busy professional, my only comic was if it had offered me finalize the payment details of everything that the itinerary brought up and you know the choice, clearly I would have. It would have saved me so much time to listen. Yeah, please execute and perform all payment details for me. So I share that because I think when the average consumer can see adopting that behavior, you’re going to get that right. Push and pull. There’s a need and there’s a capability. So I do think Agent Commerce will be adopted faster than we think. I think the challenge is going to be how do you bring up to market in a safe sound, enter with all the protections and regulatory environment around it that’s needed.

Donna Kinoshita 00:37:04 But from a pure user perspective. I think it’s one of those. There will be a market opportunity for that capability.

Jens Seidl 00:37:12 Absolutely. Great. Look, we’re running out of time. Donna, I’m so sorry. We could keep going. I think for quite a while now, but we need to wrap it up, so maybe I’ll just hand it over to you to to leave us with your thoughts on what the the near future now looks like in Canada. From a payments perspective. What’s what’s your outlook?

Donna Kinoshita 00:37:32 Yeah.

Donna Kinoshita 00:37:33 So, thank you. Mr.. thank you for the conversation. It’s been great. Really enjoyed it. Again, I would say it’s very exciting times now. It’s a great time to be in pain, to be in Canada. The RTR is becoming a reality, which is very exciting for everybody. The expansion of the membership, it’s also a very exciting time under the regulatory oversight of the RPA. So, you know, it’s almost the art of the possible and what we can do for our country, for our nation in terms of helping that spur inspire innovation, competition, economic growth.

Donna Kinoshita 00:38:11 We’re all very excited in terms of how we can play a role in that. So I’ll leave it at that.

Jens Seidl 00:38:16 Yeah, great. Oh, Donna, thank you so much for joining us today. Really appreciate that. And I hope I’m going to see you soon in person, maybe at cyber, maybe at our own conference in Istanbul next year. And thank you so much for today.

Donna Kinoshita 00:38:30 Great. Thank you for your time. Enjoyable as always.

Jens Seidl 00:38:33 Great. Thank you. Well, thank you for listening in today. Please do like the podcast and follow on your platform. Whatever you need to do to make sure that you don’t miss the next episode. Thank you all very much.

Podcast Intro 00:38:46 Thank you for listening to The P.I.T. Exchange, a podcast by Currency Research. Check out our upcoming events and publications at currencyresearch.com and join us for our next episode to hear what’s trending in payments, innovation and technology.