Why should it matter to Canadians?
The goal of Open Banking is to improve the digital banking experience for customers by making them feel informed, secure and in control. The improved experience would ensure that customers can make the right decisions when it comes to their financial requirements. Retail customers can manage their finances with the budgeting applications bringing their account details at one interface, without sharing banking credentials with intermediaries. Small and medium businesses can better manage their cashflows with accounting applications pulling accurate information from multiple financial institutions in real time.
Open Banking ensures easy access of user-permissioned financial data to service providers resulting in a reduction of the turnaround time in providing service to the customer. It also helps in preventing fraud and lowering the cost of providing the service. Complete information helps lender assess the credit worthiness of a customer in an accurate and timely manner.
Open Banking will also result in the rise of third-party providers in the banking ecosystem. The third-party providers have a goal to provide highly relevant and personalized services. Some of them already have a strong customer base and they intend to integrate banking on their platforms. As a result, customers get more choices of financial products, competitive rates, and better service.