Open Banking May Soon Be a Reality for Canadians
The new federal government has committed to open banking, stating it will introduce legislation at the earliest opportunity. That means long-awaited changes to Canada’s banking system may finally be on the way.
Open banking is in place in some countries, like Australia and the United Kingdom. But if you're new to the concept, the information below will help you understand what open banking can do.
When open banking could be in place
While the previous government stated in 2024 that early 2026 was the target for implementation, we still don't know when exactly open banking will be available in Canada.
While the new Liberal government made no mention of open banking in its election platform, advancing legislation is a surefire sign of its commitment. It's also assumed that our current Prime Minister, Mark Carney, will champion open banking. He was the governor of the Bank of England when the UK launched open banking back in 2017.
So while we're not there yet, this is another step forward for it becoming a reality.
What is open banking?
Open banking is a system that allows you to securely share your financial data with authorized apps and services. It encourages greater innovation in the fintech world by enabling new tools and features, while still keeping your information protected.
As an example, suppose you have bank accounts with one institution, credit cards with another, investments elsewhere, and a mortgage with yet another bank. With open banking, you could connect all these things and see them on one dashboard, rather than having to sign into several different platforms.
Or say you wanted a better way to budget. You could connect your various credit cards and bank accounts in one place, and easily see what you're spending. This, funnily enough, is almost exactly what we're working to accomplish in the GeniusCash app .
These are just a few examples of what open banking can do. To do this now, you need to link with some third-party services like Plaid and Flinks. These aren't the most reliable apps, and you have to provide your login info to engage with them.
With open banking, third-party services won't be needed anymore. There's no need to hand over your login info either; you just have to let your bank know you want a certain app to get access.
Your thoughts on open banking
We're curious what you think of open banking.
Leave your comments below and share your feelings, good or bad, about open banking.
Leave a comment
Comments