Ontario government endorses Open Banking and payments modernisation

The Ontario government has declared its support for establishing a made-in-Canada Open Banking framework and for modernising digital payment tools, such as Real-Time Rail.

The Honourable Peter Bethlenfalvy, Minister of Finance, endorsed Open Banking and Real-Time Rail in his 2023 Ontario Economic Outlook and Fiscal Review.

In a section about “collaborating to improve financial services”, Bethlenfalvy stated: “The Ontario government is supportive of ongoing federal initiatives in the financial markets sector.”

He said these included “establishing a made-in-Canada Open Banking framework to support Canada’s increasingly digital economy; and modernizing digital payment tools, such as Real-Time Rail, a national payment processing system intended to facilitate rapid and data-rich payments”.

“Ontario looks forward to continuing to collaborate with the federal government and regulatory partners to make further progress on these initiatives,” he concluded.

His comments have been roundly welcomed by Canada’s Open Banking, payments and fintech ecosystem.

In a post on LinkedIn, Hanna Zaidi, vice president, payments strategy and chief commercial officer at Wealthsimple, wrote: “I’m very encouraged by Ontario’s endorsement of Open Banking and the Real-Time Rail in Peter Bethlenfalvy’s Fall Economic Statement.

“While legislating on these initiatives is in federal jurisdiction, every level of government has a stake in their success. Open Banking and real-time payments have the potential to transform all kinds of financial markets – including those that are provincially regulated, like mortgages and investing.”

Neo Financial chief executive officer Andrew Chau said: “With one in four Canadians struggling to make ends meet, we applaud the Ontario government’s support for Open Banking reform and payments modernization to upgrade Canada’s financial sector.

“With progress stalled on Open Banking, Canada is rapidly falling behind the United States, the UK, Australia, and other leading economies — and Canadians are paying the price every day.

“The federal government’s own competition bureau has warned that declining competition in Canada’s economy means higher costs, less choice, and declining customer experience.”

Chau added: “We fully support Ontario in calling on the federal government to implement Open Banking, modernize payments infrastructure, and unlock the power of innovation to give Canadians control of their financial future.”

On LinkedIn, not-for-profit association Fintechs Canada posted: “The Ontario government’s 2023 Fall Economic Statement showcased strong support for Open Banking and payments modernization.

“We’re excited to see the Ontario government recognize the importance of these initiatives, helping to create jobs and attract investment in Ontario, while making life more affordable for Canadians.”

Last month, Fintechs Canada, which is the collective voice for Canadian fintechs, launched a campaign to “demand that the government upgrade Canada’s financial system” by implementing Open Banking.

The “Choose More” campaign is supported by EQ Bank, Wealthsimple, Flinks, Wise and Xero.