The several-times-delayed framework for open banking has arrived, but it still leaves a lot of uncertainty for fintechs.
What happened: This week’s fall economic statement included a long-awaited framework for open banking in Canada — referred to as “consumer-driven banking” by the government — with a promise to launch in early 2026.
- Open banking will allow for secure transmission of financial data between institutions, such as banks and fintech startups, facilitating more innovative services products and increasing competition in the sector.
- It has also been delayed several times, first being promised in early 2023, and most recently tabled for late 2025 in last year’s fall economic statement.
What’s in it: The Department of Finance and the Financial Consumer Agency of Canada (FCAC) will oversee open banking. Large banks, which have to participate, will be the first onboarded, followed by remaining financial companies that want to share data. Any participant will have to go through an application and vetting process.
- Provincial and territorial open banking regulators will be designated for institutions they have jurisdiction over, like some credit unions.
Yes, but: A federal election will happen by the fall of next year (at the latest), and there’s no guarantee that a new government will be able to — or want to — keep to the current targets.
Why it matters: There are still a few things missing from the plan — namely, the lack of a tiered accreditation system. Some in the industry believe this will unnecessarily burden smaller players that have to go through the same process as large enterprises, despite having more limited data needs.
- Also missing: a firm date for ending screen scraping, a practice where a customer gives control of a device to a company to share their information. The practice is inconvenient and less than secure, but fintechs have used it as a workaround.
- The industry has welcomed the end of the practice, but companies that currently rely on it could suffer if the ban comes before they are permitted to participate in open banking.
What’s next: The other missing piece is legislation addressing the final parts of the plan, which is needed to meet the 2026 deadline but is still being developed.