Explainer: Bill payment remittances
Whether it’s to pay for a phone service, water, gas or property taxes, bill payments are an important part of the day-to-day financial life of people living in Canada, their businesses and financial institutions (FIs).
When we think about bill payments, most of us think about sending our money to where it needs to be before the payment deadline. What is often overlooked is how bill payments travel from the bank account of the payor (customer who makes the payment) to that of the payee (the biller who receives the payment). For bill payments from a customer to a biller who happen to have the same FI, the payment process is straightforward and taken care of by the shared FI. However, the vast majority of bill payments happen between a customer and biller who do not share the same FI. That’s where Payments Canada comes in: FIs use Payments Canada’s Automated Clearing Settlement System (ACSS) to track and reconcile payments initiated by their customers to billers who use other FIs. In 2023, 9.8 billion payment items were processed through the ACSS, many of which were bill payments.
What is a bill payment remittance?
Bill payment remittances allow FIs and billers to exchange information associated with the payment of a bill. Currently, remittances can be either paper-based or electronic and provide the biller with the information necessary to identify the transaction and reconcile the bill payment against their records. More specifically, they tell the FI how much a bill payment is for, which biller the payment is for and which FI is collecting bill payments on behalf of that biller.
If you receive paper bills or invoices, the remittance is the detachable section found at the bottom.
Corporate creditor identification number (CCIN)
To participate in the bill payment process under Rule H6 for the ACSS, billers must have a Corporate creditor identification number (CCIN). The CCIN is a unique number assigned to billers to help route their client’s bill payments to them. The CCIN is printed at the bottom of bills and invoices and travels with electronic remittances.
What is Payments Canada Rule H6?
Payments Canada rules are an integral part of the legal framework of the national payment systems that Payments Canada is legislated to establish and operate. They lay out the roles, responsibilities and obligations of our member financial institutions on the appropriate handling of payment items exchanged, cleared and settled via our payment systems.
Payments Canada’s Rule H6 provides the regulatory framework for the processing of bill payment remittances through the ACSS by member FIs. While Canadians pay their bills in a variety of different ways, Rule H6 applies only to bill payment remittances, not bill payments made via credit card, for example.
How are bill payments changing?
In March 2024, Payments Canada launched a public consultation on proposed changes to Rule H6 with the aim of improving operational efficiency, embracing technological advancements in an evolving marketplace and improving the bill payment experience for all impacted groups, including consumers, businesses and financial institutions. The proposed changes were developed in close collaboration with Payments Canada members and stakeholders and are outlined in Proposed revised framework for bill payments.
Input collected through the consultation process will inform if, how and when proposed changes will be implemented.
How do I share my feedback?
All interested parties are invited to contribute to the consultation process by providing feedback and comments before May 5, 2024, to consultation@payments.ca.
