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FCAC - Open Banking and Consumer Protection: Canadians’ Awareness and Expectations

26 September 2023
The Financial Consumer Agency of Canada (FCAC) has conducted research to understand consumer awareness as it relates to open banking and fintech. In their report, the federal agency explores the pivotal role of financial literacy and education in navigating these unfamiliar waters and ensuring the financial well-being of all Canadians. The research sheds light on Canadians' awareness, understanding, and perceptions of open banking and fintech. These technologies promise to revolutionize the way we manage our finances, yet many Canadians remain unfamiliar with these concepts. 

Understanding Open Banking 

Open banking, a framework where consumers and businesses authorize third-party financial service providers to access their financial data securely, is still a foreign term to many. FCAC's research revealed that a mere 9% of Canadians had heard of open banking. However, awareness varies across demographics, with younger individuals, recent immigrants, and men more likely to be familiar with the concept. 

Among those familiar with open banking, only 62% grasped the essence of it, while many struggled to distinguish between true and false statements about it.  

Fintech: Uncharted Territory 

Fintech, another innovation poised to reshape our financial landscape, faces a similar challenge. FCAC's research found that 75% of Canadians had never heard of fintech. Yet, 36% had used fintech services, showing that some are diving into this uncharted territory without a comprehensive understanding. 

Furthermore, the research highlighted that concerns about the safety of personal information and money deter many from embracing fintech. A significant 32% of respondents worried about the safety of their personal data, while 28% expressed concerns about the security of their money. 

The Power of Financial Literacy and Education 

These findings underscore the critical importance of financial literacy and education, particularly when it comes to emerging financial technologies like open banking and fintech. FCAC's research shows that a lack of awareness and understanding can lead to apprehension and missed opportunities. 

To empower Canadians in this rapidly changing landscape, FCAC advocates for robust consumer protection measures within the open banking framework. These protections should mirror those available in traditional banking, ensuring consumers' rights and security. 

Empowering Canadians for a Financially Inclusive Future 

As we move forward, the FCAC promises to continue to champion financial literacy and education as vital to the potential of open banking and fintech for all Canadians. 

Through ongoing research and dedication to consumer protection, FCAC strives to create a future where Canadians are not only aware of open banking and fintech but also confident and informed participants. The journey has begun, and together, we can ensure that no one is left behind in this financial evolution.