Future of Open Banking in Canada relies on cooperation, establishment of standards, and cultivation of trust
The Open Banking Expo Canada 2025 provided an insightful platform to discuss the current progress and challenges of Canada's open banking implementation. The event highlighted the strides made in creating a consumer-driven banking system, while also underscoring the hurdles that lie ahead.
**Current Progress:**
The Government of Canada has taken significant steps towards open banking since the 2024 federal budget, granting the Financial Consumer Agency of Canada (FCAC) the responsibility to lead the open banking framework. Key developments include focusing on security and consumer protection, establishing accreditation systems, and launching consumer awareness campaigns.
1. **Regulatory Framework Development:** Although legislation for accreditation of service providers and common rules for financial institutions is still pending, early 2026 is targeted for implementation.
2. **Security and Consumer Protection:** The emerging Consumer-Driven Banking Framework prioritises safety and soundness by addressing data-sharing risks and enforcing oversight, aiming to protect consumers’ financial well-being.
3. **Accreditation and Standards:** FCAC is working on establishing accreditation systems with trustmarks, secure technical standards, and a public registry of approved players to build trust and transparency in the ecosystem.
4. **Consumer Awareness Campaigns:** Awareness remains a significant challenge, with only about 9% of Canadians currently understanding what open banking is. FCAC is developing strategies to promote timely and clear communication once compelling open banking applications become available.
**Key Challenges:**
- **Legislative Delays and Political Uncertainty:** The federal election and lack of a spring budget slowed legislative progress. Industry leaders have expressed concern over a lack of clarity and the risk of prolonged consultations impeding momentum.
- **Low Public Awareness and Understanding:** With most Canadians unfamiliar with open banking, especially vulnerable groups such as seniors and lower-income individuals, educating consumers about benefits and risks remains critical to foster trust and adoption.
- **Building Trust and Security:** FCAC emphasises that trust is essential, not only as a moral imperative but as an economic lever that encourages fintech investment and innovation. The framework must balance innovation with robust cybersecurity and consumer data protections.
In summary, Canada's open banking initiative is progressing steadily under FCAC leadership with a strong focus on consumer safety, trust, and regulatory clarity. The rollout faces political delays, a pressing need for consumer education, and the challenge of establishing a secure, accredited financial ecosystem that earns Canadians’ confidence. The Open Banking Expo 2025 underscored the importance of moving from consultation to concrete deployment to unlock the benefits of consumer-driven banking for Canadians.
High-impact use cases for Open Banking in Canada include areas such as improving financial inclusion, enhancing consumer experiences, and fostering innovation in the financial sector. The panel at the Open Banking Expo Canada 2025 emphasised the critical role of standardisation in achieving interoperability, reducing costs, and ensuring security.
With bipartisan political support, an engaged ecosystem, and growing consumer demand, Canada is closer than ever to realizing its Open Banking vision, but only if momentum continues through 2025. Consumer trust and awareness will be crucial for the success of Open Banking in Canada. The Consumer-Driven Banking Act was passed last year, mandating read-only data sharing for designated entities, annual consent renewal, and a standardised API framework. Alignment of privacy rules across federal and provincial jurisdictions is being advocated for. Eventually, Open Banking will not be limited to domestic borders but will be cross-border.
- The Consumer-Driven Banking Act, passed last year, mandates read-only data sharing for designated entities, a key step towards enabling consumer-driven banking in Canada.
- Moving forward, clearing the path for consumer-driven payment solutions should be a priority, as tech-savvy consumers increasingly demand seamless integration of financial services.
- With the gradual implementation of open banking, data and cloud computing become crucial for the finance and banking-and-insurance industries, transforming their operations and enabling partnerships with fintech innovators.
- Global collaboration is essential for the success of open banking in Canada, as its benefits can be maximized by harmonising regulations across borders and capitalizing on international best practices in security and consumer protection.
- As data becomes the lifeblood of the open banking system, securing it must remain a top priority to foster public trust and protect sensitive information.
- The growing fintech industry in Canada will play a pivotal role in fostering innovation and disrupting traditional business models within the wider finance and banking-and-insurance landscape.
- To unlock the full potential of open banking, the industry should focus on promoting standardisation, ensuring interoperability, and reducing costs through the development of open APIs for all players in the ecosystem.
- Ultimately, the success of Canada's open banking implementation will rely on close collaboration between the government, financial institutions, fintech players, and consumers, working together to create a secure, transparent, and consumer-centric financial services industry.
