{ "title": "Our submission to the 2026 Federal Pre-Budget Consultation", "modified_at": "2026-05-29 21:28:02", "published_at": "2026-05-29 21:28:00", "url": "https://newsroom.wealthsimple.com/our-submission-to-the-2026-federal-pre-budget-consultation", "short_url": "http://prez.ly/3HHd", "culture": "en", "language": "EN", "subtitle": "Shared with the House of Commons Standing Committee on Finance\n", "slug": "our-submission-to-the-2026-federal-pre-budget-consultation", "body": "\n \n
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\u200bMay 2026

SUMMARY OF RECOMMENDATIONS

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Implement the prohibition on investment account transfer fees as a matter of urgency.

Since Budget 2025, we estimate Canadians have paid more than $1 million per day to transfer investment accounts between providers. These fees are a tax on choice and disproportionately impact young Canadians and the less wealthy.

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Launch the RTR, open banking, and the federal stablecoin framework on schedule.

These infrastructure upgrades complement one another and will benefit from near-simultaneous implementation. Any delays will mean Canadians and small businesses keep paying more for less. The government should be among the first to avail itself of this new infrastructure.

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Build anti-fraud and financial crime protections into the new infrastructure from day one.

Financial fraud is of grave concern to Canadians and effective prevention will be critical to the success of a modernized financial system. Canadians deserve robust fraud protections, and a proportionate liability scheme to protect them from loss.

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ABOUT WEALTHSIMPLE

Wealthsimple is Canada's leading financial innovator. We offer a full suite of simple, sophisticated products across managed investing, do-it-yourself trading, cryptocurrency, tax filing, spending, and saving. Wealthsimple serves more than 4 million Canadians, holds $150 billion in assets, and employs more than 1,500 Canadians from coast to coast.

In October 2025, Wealthsimple closed a $750 million equity round at a $10 billion post-money valuation. With a profitable and growing business, Wealthsimple now operates at a scale rarely achieved by new entrants in Canadian financial services, standing as a genuine competitive counterweight to incumbent financial institutions.

Wealthsimple is grateful to the Standing Committee on Finance for the opportunity to submit recommendations for the 2026 federal budget.

ABOUT OUR CLIENTS

More than one in five Canadians aged 18-40 uses Wealthsimple (23%). This year, we reported record Q1 growth, including the highest number of RRSP transfer-ins in the company's history. This reach gives us a unique vantage point on a generation often missing from policy conversations.

Young Canadians are active, committed investors.

One in four millennial clients and one in five Gen Z clients made regular contributions to their registered accounts last year, and our youngest clients lead every other generation in their use of automated investing. Cost-of-living pressures have pushed them to cut discretionary spending, but not investing. They are putting what they can into TFSAs, RRSPs and other self-directed accounts because they know home ownership, the wealth-building tool that worked for their parents, is no longer a reliable path to financial security. They are finding other ways to get ahead.

Younger investors want and deserve agency.

Our clients value choice, transparency, and access to the same tools as institutional investors. They are quick to leave products and processes that feel paternalistic. Record rates of inbound and outbound account transfers show a generation actively shopping for value in financial services.

But the system does not always serve them well.

Almost 40% of Canadians with a TFSA use it to hold cash rather than investments — losing value in real terms over time. This default disproportionately costs the cohort with the longest investment horizon. Switching investment account providers remains expensive and slow. Accredited investor rules continue to exclude young Canadians from opportunities open to wealthier or older investors. The ongoing reforms to open banking, the Real-Time-Rail (RTR), and transfer fees directly address this generation’s needs.

RECOMMENDATION 1

Implement the prohibition on investment account transfer fees as a matter of urgency.

Canadians are already voting with their feet. Wealthsimple continues to see record rates of both inbound and outbound account transfers — a sign that Canadians are actively shopping around, and that competition in the investment space is vibrant.

However, punitive and arbitrary account transfer fees serve as a drag on account switching, artificially suppressing competition and keeping many consumers trapped in products that may not serve their needs. These exit fees typically cost $150 per account for a process that costs institutions a few dollars to execute. (ATON transfers, which make up the majority of investment account transfers, cost Wealthsimple an average of $2.20 to process.) The impact on choice is measurable: one in four Canadians under 40 has specifically avoided switching institutions because of the fear of fees, and 37% say they would likely switch if these exit fees were removed. Wealthsimple does not charge exit fees.

The federal ban on investment and registered account transfer fees announced in Budget 2025 is a huge win for consumers. Yet since its announcement, Wealthsimple clients have been charged nearly $50 million in exit fees by other institutions. A $150 fee on the average TFSA held by a young Canadian destroys nearly 2% of their savings. The federal ban must come into force without delay, and federal and provincial governments should work together to ensure it covers all financial institutions offering investment accounts, regardless of jurisdiction.

We estimate the two-year implementation period for the $10 cap on NSF fees cost Canadians over $1 billion. During the first quarter of 2026, we estimate Canadians paid more than $1 million per day in investment account transfer fees. Every month of delay has a price tag paid by Canadians saving for their first home, retirement, or their children’s education.

On transfer timelines:

Among inbound transfers from other financial institutions received by Wealthsimple in 2025, 28% took longer than 20 business days, and the slowest 10% took more than five months. (Wealthsimple completes 97% of transfers out within 10 business days.) A fee-free transfer that takes weeks or months is still a powerful switching deterrent. Complaints to CIRO about transfer delays have increased more than fivefold since 2015. Wealthsimple supports CIRO's call for a 10-business-day standard for transfers in good order, and for mandatory compensation when that standard is not met.

RECOMMENDATION 2

Launch the RTR, open banking, and the federal stablecoin framework on schedule.

Financial penalties are not the sole barrier to choice and competition in financial services. Consumers are also held back by structural and technological barriers. Canada remains the only G20 country without a 24/7 real-time payments system, while customers continue to use screen-scraping to share their financial data, which broadly remains locked behind institutional walls.

These barriers are being addressed through the most significant modernization of Canada’s financial infrastructure in a generation. The RTR and open banking will provide the technical infrastructure to give Canadians direct control of their money and their financial data, enabling them to move both where they choose. The federal government itself will also be one of the primary beneficiaries of real-time payments, and should embrace first-mover status by transitioning payments from the CRA and other federal agencies to the new rail as a priority.

At the same time, Parliament has passed the Stablecoin Act, creating a framework for Canadian companies and individuals to harness the potential of this new payment technology. Wealthsimple has been at the forefront of exploring how Canadians can benefit from stablecoins by testing real-world use cases, from sending high-value cross-border business payments to settling consumer credit card transactions. Regulating stablecoins under the RPAA and the Bank of Canada will also help issuers like Tetra Trust Company (in which Wealthsimple is an investor and strategic partner) to protect Canada’s monetary sovereignty by bringing viable CAD-denominated stablecoins to market.

These reforms reflect a broader commitment to modernizing our financial infrastructure. Implementing them in concert will enable consumers to understand the full benefits and make financial decisions accordingly. The potential impact to the real economy is enormous; payment processing friction alone costs Canadian businesses an estimated $3–6.5 billion per year.

This coordinated approach has also proven successful globally:

  • Brazil: Launched its Pix payment system in November 2020 and open banking in February 2021. Within just a few years, Pix had 160 million users and had slashed merchant fees to 0.22% — from credit card interchange fees as high as 2.2%.
  • South Korea: A similar rollout of real-time payments and open banking resulted in an estimated US$2 billion in consumer savings.
  • United Kingdom: Launched the Faster Payments Service (FPS) in 2008 — the world's first 24/7 real-time retail payment system. FPS is forecast to add US$3.8 billion to the UK’s GDP. Thanks to FPS, Britons no longer need to transfer money in advance to meet financial obligations like rent, credit card bills, utility costs, or tuition fees.

RECOMMENDATION 3

Build anti-fraud and financial crime protections into the new infrastructure from day one.

Wealthsimple strongly supports financial crime prevention efforts under the National Anti-Fraud Strategy. This is not peripheral to the open banking and RTR agenda — it is central to its success.

Concerns about fraud and scams should not delay necessary and overdue reforms to our financial infrastructure. No jurisdiction that has implemented open banking and real-time payments has curtailed or reversed either. Instead, they have built fraud protections into their new systems. This is what Canada must do from the start.

Our operational experience illustrates why this matters. Between October 2025 and January 2026, our risk team manually identified and reported more than 10,000 fraudulent advertisements impersonating Wealthsimple on Meta platforms. The Canadian Anti-Fraud Centre reported that fraud originating online accounted for 75% of total fraud losses in 2024, with social networks alone accounting for $200 million in losses. Fraud does not predominantly originate in the banking system. It originates on digital platforms. Canada's new financial infrastructure should be designed with that reality in mind.

Other G7 jurisdictions offer useful reference points. The UK's Authorized Push Payment reimbursement framework splits liability between sending and receiving institutions, creating systemic incentives for fraud prevention — though by concentrating that liability within the financial sector, it leaves social media platforms and telecoms with no financial consequence for their enabling role. The EU built Verification of Payee directly into its payment rails. The US launched FedNow on the modern ISO 20022 messaging standard, enabling more sophisticated fraud detection. Canada can learn from each of these, launch the Financial Crimes Agency in parallel with the RTR, and adopt rules to share liability across regulated sectors in proportion to their contribution to fraud losses.

As Canada modernizes its financial system, the threat surface expands. This is not an argument for slowing down. It is an argument for building right.

CONCLUSION

Young Canadians are not waiting. They are saving, investing, and switching, despite the friction and despite the fees. What they are asking for is a financial system designed for them: more choice, lower barriers, and real protection when things go wrong.

Together, the RTR, open banking, the transfer fee ban, and the competition plan represent the most significant modernization of Canadian financial services in a generation. Delivering on them will require coordinated implementation, the political will to hold institutions accountable, and a commitment to building security into the new infrastructure alongside competition, not instead of it.

Wealthsimple is grateful to the Standing Committee for its important work on these issues, and we look forward to supporting their implementation.

 

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