On Valentine’s Day this year, the Government of Canada launched its pre-budget consultations to gather input from Canadians for its Budget 2025. On the final day for submissions, The Financial Data and Technology Association of North America (FDATA), a trade association representing approximately three dozen fintech firms that provide consumers and small- and medium-enterprises with innovative financial products, services, and tools, provided the government with its views.
In addition to addressing the current US-Canadian context, the Canadian Budget 2025 looks to make life more affordable for all Canadians, strengthen the country’s economic security, and unlock growth by boosting its competitiveness and productivity.
Dominic LeBlanc, Minister of Finance and Intergovernmental Affairs, commented on the consultation launch in February, saying: “Consulting Canadians is not only about shaping an effective and successful budget – it’s about creating a budget that reflects the priorities of the people it serves. While we continue to stand up for Canadian consumers, jobs, and businesses, we want to hear from you on the issues and priorities that matter most. This is your budget, and we are eager to hear your ideas.”
Views from FDATA
Almost a month after the call for views, FDATA North America has submitted two recommendations to the Government of Canada to improve the country’s financial ecosystem, primarily focusing on the development of open banking and open finance.
Hasten delivery of open finance in Canada
The implementation of consumer-driven finance in Canada has been plagued by delays. Amidst significant economic uncertainty, FDATA North America encouraged the Government to prioritise delivering a comprehensive open finance regime to Canadian consumers and small- and medium-enterprises.
In its first recommendation, FDATA notes that in the Budget 2024, an open banking framework was conceived and could be implemented this year. In order to increase competition in the Canadian finance sector, FDATA North America calls on the House of Commons’ Standing Committee on Finance (FINA) to hold the government accountable and come through on its promises from last year’s Budget.
FDATA North America also adds that this is crucial to support the development of smaller businesses and states that they must be “unequivocally considered within the scope of the first phase of Canada’s open banking framework.”
To support this rollout, FDATA also recommends that the Financial Consumer Agency of Canada (FCAC) be adequately resourced to oversee and enforce the open banking framework.
Adjust the initial design of Canada’s open finance regime
The second recommendation looks to build on the previous development of open banking and evolve its development to open finance. According to FDATA, the result of this evolution “would enable more consumers to gain access to a wider range of financial products and services, to have greater control of their data, including information from credit bureaus and utilities, and to develop a stronger relationship with their finances, empowering them to make better financial decisions.”
Developing financial takes time, writes FDATA. As a result, it urges the government to start planning an open finance regime as soon as possible, focusing on the inclusion of small and medium sized firms. “By putting a stake in the ground and committing to a timeline by which the government intends to deliver this outcome, Budget 2025 would stimulate market-driven progress and holistically harness the power of technology to improve consumers’ and small businesses’ financial wellbeing.”
