Canadian Fintech Leaders Urge Progress as Government Delays Open Banking
Canadian tech leaders in the finance sector are expressing growing frustration over the delay in implementing open banking, calling on the government to expedite plans for increased consumer control over financial data.
According to CityNews, dozens of industry figures have reached out to Finance Minister Chrystia Freeland, emphasizing the necessity for Canada to catch up with global advancements in open banking.
Nicholas Schiavo, representing the Council of Canadian Innovators, stressed the overdue nature of open banking in Canada, urging swift action to align with international progress.
The system, already operational in the U.K. and the European Union and advancing in the U.S., aims to empower Canadians by granting them control over who accesses their financial data.
Additionally, it would enable seamless data transfer between accounts, akin to shifting dental records when changing dentists.
Advocates highlight the potential for securely linking various services, such as budgeting apps and credit assessments, with banking information, fostering convenience and security for consumers.
Millions of Canadians currently utilize data-sharing services reliant on the less secure “screen scraping” method, which necessitates sharing login details.
Schiavo underscored the potential of open banking to enhance competition in Canada’s concentrated banking industry and reduce fees.
Lori Weir from Four Eyes Financial echoed the urgency for progress this year, emphasizing the need for consolidated financial data, akin to health data, to facilitate better financial decision-making.
The call to action from tech leaders follows the launch of a campaign pressuring the government to fulfill its commitments, including the implementation of open banking by 2023, as pledged in 2021.
Despite the appointment of Abraham Tachjian as the open banking lead and subsequent working group efforts, the timeline for system implementation remains uncertain.