If I have a checking account, can I use it pay large bills using online banking without encountering any difficulties? I intend to pay a bill of $20k+ to an educational institution. It will be a bill payment, and not a wire transfer or Interac e-Transfer. I know that Interac e-Transfer has daily dollar limits, but is there any limit for bill payments? Could there be difficulties (e.g. questions from the bank, blocked transaction, daily limits, etc.)?

(Beginner here. This is my first time trying to pay a "large" bill using online banking. Please be gentle.)

  • Which source bank? – AakashM Sep 22 '20 at 8:54
  • @AakashM BMO Bank of Montreal. – Flux Sep 22 '20 at 8:56
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    Did you ask the bank? Also sometimes the University can pull the funds. They may know if there is a limit. – mhoran_psprep Sep 22 '20 at 12:18
  • say @Flux if you end up phoning the bank and asking "what's the limit" I'd be intrigued to know the value. cheers! – Fattie Sep 22 '20 at 13:16
  • @mhoran_psprep What does "pull the funds" mean? – Flux Sep 24 '20 at 0:18

Any such limit would be at the institutional level, not through systematic limitations on Canada's underlying electronic payment system. Risk of fraud through 'bill payments' in Canada is greatly limited compared to wire payments or other payment methods, because the receiving party needs to register in advance as a known recipient with the bank, and so some more vetting is involved than simply opening a bank account.

You can ask your bank if your personal account has such limitations, but I'll add that corporations use the same bill payment feature and routinely pay far larger bills than that!

  • Cool info thanks, Last sentence intriguing, what actually "is" this Canadian "Bill Payment" system? Is it an ACH or ?? – Fattie Sep 22 '20 at 13:15
  • @Fattie On the back end, this is not through the ACH system [which doesn't exist in Canada, we have a similar but in some ways worse system called Electronic Funds Transfer - for example, it is impossible for a corporation to automatically block non-whitelisted EFT 'auto debits', which can be a common form of fraud that requires monthly vigilance]. This isn't through the EFT system either, I believe it is its own beast. – Grade 'Eh' Bacon Sep 22 '20 at 13:22
  • Intriguing, thx (we once owned a payment processing thingy, but I guess I was completely drunk when dealing w/ Canada :O ) – Fattie Sep 22 '20 at 13:29
  • @Grade'Eh'Bacon "not through systematic limitations on Canada's underlying electronic payment system" it's possible there is a systematic limit, but probably not at a level that would affect any "normal" person... in the UK, the BACS (extensively used for payroll and supplier payments and Direct Debit collections) has a £20 million limit. Faster Payments (used for online banking payments) has a limit of £250,000 per transaction. (In both cases, as in Canada, you're likely to hit a bank limit way before this). – TripeHound Sep 22 '20 at 22:44
  • @TripeHound Fair point - anecdotally from corporate experience, I'll add that any possible systematic limitation would be well in excess of $5M. – Grade 'Eh' Bacon Sep 22 '20 at 23:35

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