long-awaited report to the federal government on the opportunities and challenges involved with the practice. Open banking, in a nutshell, is a regulatory framework that would enable consumers to share their financial data with banks and other financial service providers or to move their data from one institution to another.
In its report, the committee recommended a framework which is aimed at protecting banking information of customers, while establishing a stable and innovative financial sector. It also recommended three key elements, including the protection of customer data by open banking industry participants and ensuring those responsible are held liable.
Accordingly, last week, three industry groups representing about 250 financial-services companies requested the federal government for clarity on in intentions to adopt the recommendations made by the committee in its report. The request was made in a joint letter addressed to Finance Minister Chrystia Freeland, co-signed by the Canadian Lenders Association (CLA), the Paytechs of Canada Association and he Financial Data and Technology Association of North America. The members of these three groups range from emerging companies like Flinks and Wealthsimple to large multinational firms like Visa and Raymond James.
“Our organisations represent 249 financial technology companies, including Canada’s fastest growing and most innovative firms,” the letter, obtained by The Logic from a source, read. “We have come together united in support of the full implementation of the phase one and phase two recommendations of the advisory committee on open banking and to respectfully request your public support for the same.”
They called on the government to go beyond its general campaign promise in implementing open banking by 2023, and for the Department of Finance to make specific commitments that would expand the right of third parties’ to access financial data stored with banks. These specific commitments include the endorsement of open banking with legislation, setting up a formal governance organisation for open banking and building added technological capabilities into the system.
