Technology leaders from numerous fintech companies have joined forces in a letter to Canada’s finance minister, urging the prompt implementation of a long-awaited open banking framework.
Despite a three-year investigation into the feasibility of adopting a system similar to the UK’s, allowing third-party financial services providers access to banking data, the Canadian government, which committed to enacting regulations by early 2023, has yet to do so. This delay has left the fintech sector increasingly frustrated.
Coordinated by the Council of Canadian Innovators (CCI), the letter, signed by leaders from fintech firms like Borrowell, Koho, and Neo Financial, emphasizes the need for Canada to align with the European Union, the United States, and the UK in establishing an affordable and innovative open banking system.
The letter cautions, “The longer we wait to implement a secure, 21st-century financial system, the greater risks Canadians will be exposed to.”
In response to the government’s delay, the signatories have initiated a campaign called “Canadians for Open Banking,” marking the second such effort in just over a month. In October, industry group Fintechs Canada, along with Wealthsimple, EQ Bank, and Wise, launched the “Choose More” campaign to garner public support for government action on open banking and payments modernization.
A Deloitte survey conducted in June revealed that only 18% of respondents were familiar with the concept of open banking. However, awareness among 18- to 34-year-olds rose to 35%. The survey also indicated that 35% of Canadians felt comfortable sharing their data online, with that number increasing to 45% once the open banking framework is implemented.
The recent letter to Minister Chrystia Freeland implores, “Today, we are calling on you to reaffirm your promise to enact open banking and release a clear roadmap for when we can expect to see it implemented. Many of us made business investments and built strategies around your election promise; we need assurance that you’re going to keep your word.”