Canadian Fintechs Demand Immediate Action on Open Banking
A group of prominent leaders in the Canadian fintech industry has come together to call on Canada’s finance minister to provide a definitive plan for the long-awaited open banking framework, as outlined in Finextra News. This demand follows a three-year investigation into the feasibility of implementing open banking in Canada, similar to what is already in place in the UK, which allows individuals to grant third-party financial service providers access to their banking data.
Despite initial promises of regulatory action by the beginning of 2023, the Canadian government has yet to deliver on this commitment, causing growing frustration within the fintech sector. In a coordinated effort led by the Council of Canadian Innovators (CCI), numerous fintech leaders, including those from Borrowell, Koho, and Neo Financial, have signed a letter addressing the issue.
In the letter, the signatories assert, «It’s time for Canada to catch up with the European Union, the United States, and the UK to ensure we have affordable and innovative open banking.» They emphasize the importance of implementing a secure 21st-century financial system promptly, warning that delaying the process exposes Canadians to greater financial risks.
To bolster their cause, these fintech leaders have launched the «Canadians for Open Banking» campaign, marking the second such initiative in just over a month. In early October, Fintechs Canada, along with industry heavyweights like Wealthsimple, EQ Bank, and Wise, introduced the «Choose More» campaign to garner public support for government action on open banking and payments modernization.
A Deloitte survey conducted in June highlighted the need for increased awareness regarding open banking in Canada, with only 18% of respondents being familiar with the concept. However, among individuals aged 18 to 34, this percentage rose to 35%. The survey also revealed that only 35% of Canadians felt comfortable sharing their data online, but this figure increased to 45% once the open banking framework was in place.
In their latest letter addressed to Finance Minister Chrystia Freeland, the fintech leaders assert, «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.»
The Canadian fintech industry is making a united and compelling plea for the swift implementation of open banking to keep pace with global counterparts and ensure affordable and innovative financial services for all Canadians. The ball is now in the government’s court to provide a clear roadmap and fulfill its commitment to open banking.