Bank of Canada takes over open banking oversight from FCAC: what it means for your financial apps

For anyone who links a bank account to a money app, the fine print matters. Here’s what’s changing, what it could mean for your wallet and what to do while the rules are still being finalized.

What is open banking, and why is Ottawa stepping in?

Open banking lets you share your account data directly with an app of your choosing through a secure, bank-grade connection instead of typing in your password. Overseen by the Bank of Canada, the new framework would require any company handling your financial data — from big banks to small fintechs — to be accredited, meet baseline security standards and use multi-factor authentication before your data moves anywhere.

Screen scraping isn’t banned yet. The government says a ban needs more consultation before it can take effect, so for now, both methods will exist side by side. The full framework is expected to be phased in, starting with accreditation requirements, then common rules on consent and security, with the whole system meant to be operating within a year of final publication.

What could this be worth to you?

The Department of Finance estimates the new system would generate $13.2 billion in benefits for Canadians and businesses over 10 years, against $457.7 million in costs — most of which fall on the companies building the technology, not consumers directly.

Here is some of the projected upside, per person:

• About $213 more in credit access for Canadians who are currently underserved by traditional credit scores
• Roughly $58 a year from apps that nudge idle chequing account cash into higher-interest savings
• Close to $120 and $78 a year, respectively, from tools that flag cheaper mobile and broadband plans.

Apps that catch forgotten subscriptions could save users about $28 a year. These figures are drawn from the United Kingdom’s open banking experience and are described by the government as illustrative estimates, not guarantees.

Who stands to gain the most?

Newcomers to Canada and Canadians with limited credit history could benefit most from tools that use transaction data — like on-time rent payments — to prove creditworthiness beyond what a traditional credit score shows. Small business owners are also flagged as a key group: the government estimates open banking tools could save the average small business roughly 52 hours a year on bookkeeping and admin.

The costs, by contrast, are expected to land mainly on the roughly 680 businesses required to build and maintain the new data-sharing infrastructure, more than 80% of which are small businesses. Consumers aren’t expected to pay directly to share their data, though the government notes some businesses could pass a portion of their compliance costs on through pricing.

What should you do now?

• Take stock of which apps already have your banking password through screen scraping, and consider whether you still need all of them
• Once the Bank of Canada launches its public registry of accredited providers, check whether the apps you use are on it before sharing more data
• Watch for a visual sign or notice that a provider is accredited under the framework — companies will be required to display one
• Don’t expect screen scraping to disappear immediately; a ban requires further consultation and a separate timeline
• Read consent screens carefully going forward — under the new rules, consent lasts up to 12 months before it must be renewed

The bottom line

Open banking won’t flip a switch overnight for Canadians. The rules published are still in draft form, and full implementation is expected to roll out in stages over the next year or more. In the meantime, the safest move is knowing exactly which apps already have your banking credentials, and staying alert for signs that a safer, accredited alternative is available.