Consumer-driven banking, also known as open banking, has long been awaited in Canada. Following the release of Budget 2025, it seems that the wait may almost be over as Canada edges closer to implementing a consumer-driven banking framework. This article looks at how we got here and what to expect next for consumer-driven banking in Canada.
What is Consumer-Driven Banking?
Consumer-driven banking is a framework that allows consumers and small businesses to direct financial institutions to securely share their financial data with participating entities (e.g., financial technology companies) of their choice through application programming interfaces (APIs). The APIs act as a bridge that allows financial institutions and participating entities to securely share a consumer’s financial data without using screen scraping. Once consumer-driven banking is available in Canada, consumers will no longer need to provide financial technology companies with their online banking credentials in order to share their financial data. Accordingly, this data-sharing model enables consumers to have a more comprehensive view of their finances and access innovative financial products tailored to their specific needs without having to take on the risks associated with screen scraping.
Brief History of Canada’s Path to Consumer-Driven Banking
For the last eight years, the federal government has been slowly moving towards implementing consumer-driven banking.
- 2018: An Advisory Committee on Open Banking was appointed by Canada’s Minister of Finance.
- 2019: The Advisory Committee on Open Banking published a consultation document based on stakeholder submissions.
- 2020: The Advisory Committee on Open Banking released findings and conducts stakeholder consultations.
- 2021: The Advisory Committee on Open Banking released its Final Report recommending consumer protection rules, an accreditation system for third-party service providers and technical requirements to enable safe and efficient data transmission.
- 2022: The federal government appointed Abraham Tachjian to spearhead the development of a comprehensive ‘made‑in‑Canada’ open banking framework and formed a steering committee and four working groups focused on accreditation, liability, privacy, and security.
- 2023: The steering committee and working groups met regularly between July 2022 and April 2023 and made available the outcome of their meetings. The 2023 Fall Economic Statement indicated that the federal government would introduce legislation through Budget 2024 and release a related policy statement.
- 2024: The federal government accelerated progress on consumer-driven banking beginning with the announcement in Budget 2024 that the Financial Consumer Agency of Canada (FCAC) would be mandated to oversee, administer and enforce Canada’s consumer-driven banking framework and continued with the passing of the Consumer-Driven Banking Act (CDBA). However, while the CDBA sought to create a foundation for the consumer-driven banking framework, it lacked key details regarding the implementation of consumer-driven banking and did not address liability, data security standards or governance matters.
- 2025: The federal government announced that the oversight of Canada’s consumer-driven banking framework will shift from the FCAC to the Bank of Canada to build on the Bank of Canada’s oversight of payment service providers. Consistent with its commitment in Budget 2025, the federal government introduced amendments to the CDBA in the Budget Implementation Act (the “Updated CDBA”) to complete Canada’s consumer-driven banking framework.
Highlights from the Updated CDBA
The Updated CDBA will cover the first phase of the consumer-driven banking framework (i.e., “read-only access”). The following are some of the key highlights from the Updated CDBA:
- Participating Entities: Participation in consumer-driven banking will be mandatory for certain designated banks and will be optional for other provincially or federally regulated financial institutions, registered payment service providers (PSPs) registered under the Retail Payment Activities Act and other businesses and organizations (e.g., financial technology companies, firms, etc.) that satisfy the accreditation requirements.
- Eligible Consumers: The Updated CDBA has broadened the scope of “consumer” to include “businesses”, there remains an open question around who will constitute a “consumer” or a “business”.
- Accreditation: Except for ‘mandated banks’, participating entities will need to be accredited prior to participating in consumer-driven banking. The accreditation process will vary depending on the type of participating entity. For example, provincially and federally regulated financial institutions will be eligible to participate in a streamlined accreditation process whereas PSPs can apply for streamlined accreditation. Other participating entities and third-party service providers will need to undergo a more comprehensive accreditation process. Accreditation will not be a static obligation, and participating entities will be subject to mandatory ongoing reporting.
- Scope of Data: Examples of data that can be shared will include information on chequing and savings accounts, investment products, and various lending products such as credit cards, lines of credit, and mortgages.
- No Derived Data: The Updated CDBA expressly excludes derived data, that is, data about a consumer product or service that has been enhanced by a participating entity to significantly increase its usefulness or commercial value. The federal government has provided the following guidance on what may be considered derived data:
- the outcome of an assessment such as a consumer credit rating, whether generated by the institution itself or provided by a third party such as a ratings agency;
- the categorization of spending based on account data, for example classifying spending as related to rent, groceries, or car payments;
- saving and budgeting recommendations based on analysis of account data; and
- highlights of upcoming fund shortfalls or surpluses based on past spending behaviours.
- Consent-based Data Portability: Consumers must explicitly consent to the sharing of their data. Beyond what exists in current privacy legislation, participants will be required to have a standardized and clear means for consumers to provide and revoke their consent. These means will be based on user experience guidelines which participants will be required to adopt.
- Screen Scraping Prohibition: The Updated CDBA includes broad and sweeping prohibitions on screen scraping.
- Single Technical Standard: The consumer-driven banking framework will mandate a single technical standard to which APIs are built to support functionality and interoperability.
- Liability: The consumer-driven banking framework will establish a statutory, rather than contractual, liability structure between participants and liability is expected to flow with the data.
What Consumers can Expect for Consumer-Driven Banking in 2026 and 2027
The federal government signaled its intention to move the Updated CDBA amendments through the legislative process on an accelerated basis. At the same time, the Department of Finance will spend 12 to 18 months consulting and developing policy for a second phase designed to broaden both features and participation.
The first phase is already underway and focuses only on “read-only access” (i.e., the ability to direct financial institutions to securely share their financial data with participating entities of their choice). The second phase will broaden the functionality to include “write access” (i.e., the ability to initiate an action from an account such as making payments or switching accounts). The federal government expects to finalize phase two by mid-2027; however, the completion of phase two will depend on the successful rollout of Canada’s real-time rail payments infrastructure.
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