The mortgage industry has long advocated for an overhaul of banking structures
The federal government says it remains committed to implementing open banking and intends to introduce the necessary legislation at the “earliest opportunity,” following concerns from industry leaders that the initiative has lost momentum.
Open banking, officially referred to by Ottawa as consumer-driven banking, would allow individuals and businesses to share their financial data securely with authorized third-party services, such as fintech firms. The proposed framework aims to give consumers greater control over their data, improve transparency, and encourage competition in the financial sector.
The government took a first step last year by passing legislation through the 2024 federal budget that gave the Financial Consumer Agency of Canada (FCAC) the authority to lead the initiative. However, further legislation is required to create a system for accrediting service providers and setting consistent rules across institutions.
Although the 2024 fall economic statement targeted early 2026 for implementation, the timeline appears uncertain. A federal election earlier this year returned the Liberals with a minority government, but no mention of open banking appeared in the party’s platform, and the spring budget – typically used to outline key priorities – was not tabled.
The industry is still waiting for clarity, noted Natacha Boudrias, who leads the National Bank of Canada’s open banking strategy. “We’re certainly hoping that the government is going to kick-start the effort sooner rather than later,” she told the Canadian Press.
Consumer control at the core of open banking
The Finance Department confirmed in a statement that it remains committed to advancing the consumer-driven banking framework and is preparing to table the remaining elements.
Meanwhile, the FCAC is developing a public registry of accredited fintech providers. Commissioner Shereen Benzvy Miller, speaking at the Open Banking Expo in Toronto, said Canadians are already sharing personal data with financial apps, often unaware of the privacy risks involved in methods like screen scraping – where full banking credentials are handed over to third-party apps.
Miller said part of the agency’s role will be to raise awareness and ensure consumers can confidently share data with trusted providers. “We envision a future – not far off – where consumers can securely share their financial data with trusted providers at the tap of a button,” she said.
Alex Vronces, executive director of Fintechs Canada, said the delay in final legislation risks leaving the FCAC with a mandate it cannot yet enforce. However, he expressed hope the remaining steps could be finalized soon, possibly with the fall budget.
“It’s really not a lot of work for the government to complete its promise,” Vronces said.
What are your thoughts on how global trade tensions impact household spending? Share your insights below.
