Canadian Open Banking legislation receives Royal Assent

In Canada, Bill C-69 – also known as the Budget Implementation Act 2024 No. 1 –  received Royal Assent on June 20, bringing into law a Consumer-Driven Banking Framework.

In the Fall Economic Statement, the Canadian government promised to “develop and implement a legislative framework for consumer-driven banking” and followed this up in Budget 2024 delivered on April 16, with a commitment to introduce legislation that establishes the “foundational elements” of an Open Banking Framework this Spring.

Parliament of Canada stated that the purpose of the Consumer-Driven Banking Act “is to establish a framework within which consumers, including small businesses, can direct that their data be shared among participating entities of their choice and to ensure that the sharing of data among participating entities is safe and secure”.

In a statement, Deputy Prime Minister and Minister of Finance Chrystia Freeland said: “The passage of the Budget Implementation Act will further our plan to ensure that every generation has a fair chance at success.”

She added: “The measures enacted with the Budget Implementation Act are bold investments in housing, a stronger social safety net, and economic growth to ensure fairness for every generation.”

Hanna Zaidi, vice president, payments strategy and chief compliance officer at Wealthsimple, wrote on LinkedIn: “After Bill C-69 received Royal Assent on Thursday night, the Open Banking framework is now part of Canadian law for the first time.

“While we’re not at the finish line yet, it’s important to acknowledge this significant milestone and the hard work that got us here.”

Payments and Bill C-59

Lisa Sattler, director of policy and government relations at Payments Canada, also revealed that proposed changes to the Canadian Payments Act, which will expand Payments Canada’s membership, also received Royal Assent.

“The changes were included in the 2023 Fall Economic Statement Implementation Act, also known as Bill C-59, and will come into force on a day/days to be set by the Governor in Council,” said Sattler.

“With these changes, Payments Canada’s membership eligibility will be expanded to payment service providers, credit unions that are members of their provincial centrals and clearing houses of systems designated under the Payments Clearing and Settlement Act.”

She added: “Reaching Royal Assent represents a critical milestone toward modern payments in Canada and the culmination of a joint advocacy effort from leaders across the Canadian payment ecosystem.”

In a post on LinkedIn, Fintechs Canada wrote: “This milestone reflects years of hard work and collaboration between Canada’s fintech community and the government.

“Bill C-69 and Bill C-59 now allow payment service providers to access Payments Canada’s systems and establish the foundational parts of Canada’s open banking system. This progress shows the power of a united effort to advocate for change.”