Send a cheque via e-mail.

Signing a cheque may soon be as simple as clicking on a mouse

By the end of the year, clients of at least three major Canadian financial institutions will have a new way to send money and perhaps ultimately pay for services.

Signing a cheque will be as easy clicking on a mouse. CIBC, Bank of Nova Scotia and TD Bank Financial Group have signed a letter of intent with Toronto-based CertaPay Inc. to offer their customers the latest in payment innovation and convenience: the ability to make secure payments by e-mail.

CertaPay has developed state-of-the-art software that allows bank customers to send money securely via e-mail. The company specializes in Internet-based payment solutions for financial institutions and is designed to work under financial institution brands, security and control.

To send a payment, bank customers will access their accounts online and specify the recipient's name and e-mail address. The recipient will receive an e-mail notification instantly with directions on how to collect the payment securely and in real time.

According to IDO (International Data Corp.) Canada research, an estimated one million Canadians will e-mail $2.2 billion in payments within the first 12 months of availability.

"We see this new e-mail service as marking a significant step forward in encouraging more Canadians than ever before to go online and try out the convenience of sending money securely using e-mail," Albert Wahbe, chief executive officer of e-Scotia and Bank of Nova Scotia's executive vice president of electronic banking, stated in a Feb. 7 release announcing the new program.

Chuck Hounsell, senior vice-president of e-Bank Canada for TD Canada Trust, says the system will initially be set up for person-to-person (P2P) transactions, but notes it could be used as a bill payment method in the future.

"This is about e-mailing money as opposed to bill payment per se," Hounsell says. "This has really been set up predominantly as a person-to-person payment (system), so whether it will stretch into a consumer-to-business payment mechanism is not yet decided, but it certainly has that potential."

CertaPay will enable banks to integrate a (P2P) payment capability into their existing online services. Hounsell says any TD Canada Trust client who is already set up for online banking will be able to access this new service.

"The way this is designed to work is it will ultimately be incorporated into our Web site, so if you wanted to send money, you would log on to our Web site, you would go to the area (that would allow you to) send somebody money, and select the account you want the money to come from. Then you would type in the name and e-mail address of the person to whom you're sending (the money) to. There's a process by which you would verify that person through some specific questions that only they would know the answers to.

"That e-mail goes out throughout the system, they receive it, they verify who they are and tell us which account they want the money to go into, and then we arrange the transfer.

"The benefit is you only need to know the person's e-mail address. We'll look after getting their account number from them through the system."

The sender is the only person who needs to have a bank account with one of the financial institutions that have signed up to offer this new service, Hounsell adds. The recipient needs only to have a Canadian bank account and an e-mail address.

"We're still working through the exact system, but we're hoping that ultimately all the banks in Canada are on the same system," Hounsell says. "Right now there are only three of us signed up for this (program)."

The service is expected to be implemented late this year and Hounsell says it may be technology that brings more clients online to do their banking.