After consulting financial system stakeholders, consumers and business organizations, the Canadian government recently announced plans to develop a framework for consumer-directed finance (or open banking).
Ahead of further consultations, the government has revealed some principles it considers important for such a framework.
Excerpts from the Report of the Advisory Committee on Open Banking, 2020
The committee heard that, with the strength of its financial services sector, ambitious innovators and top talent, Canada has the potential to be a leader in the development of consumer-directed finance – but that it risks falling behind if it does not take timely and concrete action.
Consumer-directed finance could deliver tools that would support Canadians in improving their financial outcomes.
While there are risks – principally those related to consumer protection, privacy and cybersecurity – the committee found that these risks exist in the current unstructured environment, and implementation of a structured framework could serve to better address and manage them.
The committee heard broad-based agreement from stakeholders that the development of a consumer-directed finance framework, with appropriate safeguards, established in collaboration with industry and government, would more effectively deliver benefits to Canadians and mitigate risks involved in data sharing.
Produced by Randall Anthony Communications. The Globe’s editorial department was not involved in its creation.