When Will Open Banking Launch in Canada? Ottawa Promises Action

The federal government has pledged to introduce legislation to establish open banking “at the earliest opportunity,” even as some industry advocates warn that momentum on the file has slowed.

Known in Ottawa as consumer‑driven banking, open banking would let Canadians and businesses securely share financial data with authorized third parties beyond their banks. The approach is designed to give consumers greater control over their information and enable new financial services and innovations.

With open banking, people who hold accounts at multiple institutions could view their complete financial picture on a single dashboard. The system could also expand access to credit by allowing alternative data—such as on‑time rent payments—to factor into credit assessments.

Several countries have already implemented open banking ecosystems, and the federal Liberals passed initial legislation last year to begin building a Canadian framework.

Delays in legislation for open banking

Despite progress, industry stakeholders say advancing the remaining legislative work has been slow. “It’s been a slog,” said Alex Vronces, executive director of Fintechs Canada. He added that early on the government may not have fully grasped what consumer‑driven banking entails.

After years of study, Ottawa started moving forward with open banking by introducing provisions in the bill that implemented the 2024 federal budget. That bill assigned the Financial Consumer Agency of Canada (FCAC) a central role in developing the framework. However, additional legislation is still needed to set accreditation processes for service providers and establish the common rules that financial institutions and fintechs must follow.

When will open banking be implemented?

The government’s 2024 fall economic statement targeted early 2026 for open banking implementation. Since then, Canada held a federal election, and while the governing party returned to office in a minority, consumer‑driven banking did not appear prominently in the election platform. The government also chose not to table a spring budget, a traditional vehicle to outline legislative priorities.

Natacha Boudrias, who leads open banking strategy at National Bank of Canada, said the industry is seeking clarity on how consumer‑driven banking will ultimately be structured. She suggested the election disrupted momentum and urged the government to resume work quickly to avoid endless rounds of consultation.

In a media statement, a Finance Canada official reiterated the government’s commitment to consumer‑driven banking: “The remaining elements of the consumer‑driven banking framework will be introduced at the earliest opportunity, to ensure that Canadian consumers and business can securely benefit from tools that help them reduce costs and improve their financial outcomes.”

One Canadian bank is adopting an open‑banking framework

While federal rules remain pending, National Bank has developed its own open‑banking framework. This allows fintechs—companies that build financial apps and services—to connect securely to the bank’s systems when customers authorize access.

Today, many data-sharing arrangements rely on “screen scraping,” where a customer provides login credentials to a third party so it can access account information. Boudrias warns that screen scraping typically grants wholesale access—everything or nothing—raising privacy and security concerns.

Open banking replaces that broad approach with precise permissions: customers decide what data a fintech can see and for how long, reducing unnecessary exposure of sensitive information. “It’s about putting the rails of trust in place,” Boudrias said.

FCAC commissioner Shereen Benzvy Miller highlighted the risks of screen scraping during her keynote at the Open Banking Expo in Toronto. She noted Canadians already share data widely with fintechs but may not fully understand the privacy implications. Part of FCAC’s role will be to raise consumer awareness and build trust in a regulated open banking system.

“We envision a future not far off where consumers can securely share their financial data with trusted providers at the tap of a button,” Benzvy Miller said in remarks shared with the press.

Who will accredit Canada’s financial service providers?

FCAC is set to create and maintain a public registry of accredited fintechs and financial service providers that meet security and privacy standards. Accredited firms would display an official mark so consumers and institutions can easily identify trusted providers.

Benzvy Miller said FCAC is collaborating with Finance Canada to define common rules for the system and is awaiting further legislative amendments from the finance minister to finalize its mandate. Without that final legislation, regulators risk being limited to planning and consultation without the authority to operationalize the framework.

Vronces warned that a prolonged gap between mandate and authority could leave the agency in “regulatory purgatory.” For fintechs, getting this done has been a long process—Vronces has been advocating for open banking in Canada for several years.

He believes the finance minister’s personal experience with open banking abroad could help advance the agenda. The broader opportunity, he argued, is significant: opening data flows can stimulate competition, push established banks to diversify services, and accelerate innovation across Canada’s financial sector.

The potential benefits of open banking

Proponents say open banking would spur competition and product development by allowing fintechs and smaller institutions to offer tailored services that challenge incumbents. Consumers could benefit from lower costs, better tools for managing finances, and expanded access to credit through alternative data sources.

Vronces remains hopeful the government will complete the remaining legislative work soon—possibly alongside a fall budget—so the framework can move from planning to implementation. “Most of the groundwork is already done,” he said. “The government simply needs to finalize the remaining steps so Canadians can start reaping the benefits.”

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