The upcoming federal budget reveals plans to integrate open banking into Canada’s financial system. Open banking, a model allowing customers to control their financial data sharing, will enable banks to share data with third-party fintech apps through APIs, similar to “log in with Google” for website accounts.
This move is significant for the approximately 9 million Canadians using fintech apps, often compromising banking login credentials and potentially voiding electronic banking warranties. Open banking promises to establish secure data sharing protocols and client permission guidelines. Additionally, it could spur competition in the banking sector, benefiting consumers by facilitating bank switching and empowering smaller banks.
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