Submission to Finance Canada on the Consumer-Driven Banking Regulations

August 2026
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​SUMMARY OF RECOMMENDATIONS

​Wealthsimple extends its thanks to the Department of Finance Canada for the opportunity to respond to the consultation on the proposed Consumer-Driven Banking Regulations published in Canada Gazette Part I on June 27, 2026.

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 over $155 billion in assets under administration (as of June 30, 2026), and employs 1,750+ Canadians from coast to coast.

Wealthsimple's Q2 results showed the company becoming many Canadians' everyday financial home: it attracted approximately $17 billion in net flows, AUA rose 84.1% year over year, and chequing account openings outpaced investment account openings for the first time. Net deposits also reached all-time highs, underscoring the momentum behind Wealthsimple's expansion beyond investing and into everyday banking. 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.

ABOUT OUR CLIENTS

Almost one in four Canadians aged 18-40 uses Wealthsimple. 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 many to cut discretionary spending, but not investing. Many 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 tools that give them the level of control they want at different life stages. They are quick to leave products and processes that feel paternalistic. Record rates of account transfers in 2026 show a generation actively shopping for value in financial services.

Switching investment account providers remains expensive and slow. The government’s commitment to open banking - among other important consumer-driven changes to Canada’s financial sector, including the Real-Time Rail (RTR) and the federal ban on investment and registered account transfer fees - will, once implemented, directly address this generation’s needs.

RECOMMENDATION 1

Establish and publish a full implementation schedule

Competition in Canadian financial services is increasing. In Q2 2026, Wealthsimple chequing account openings outpaced investment account openings for the first time and we continue to see record rates of investment account transfers — a sign that Canadians are actively shopping around. And this is not limited to one institution: the federal government estimates that nine million Canadians currently share their financial data by providing confidential banking credentials to service providers, otherwise known as screen scraping.¹ This scale must be measured and remain top of mind as the government drives forward with its agenda for consumer-driven banking.

Proponents of consumer-driven banking don’t question the government’s commitment to consumer choice, but the knock on costs and consequences of delay is easy to underestimate. When timelines slip, consumers and newer entrants suffer. ​ For example, the federal ban on investment and registered account transfer fees announced in Budget 2025 is a significant win for consumers. Yet, since its announcement, Wealthsimple clients have been charged more than $70 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.
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​These same principles apply to the proposed regulations under the Consumer-Driven Banking Act. Confusion around timeline implementation and significant delays in implementation risk costing Canadians additional fees and further frustrating the consumer benefits that will come with open banking. The government has taken important steps by establishing the Consumer-Driven Banking Act. However, the only commitment with a timeline for implementation is that the full suite of proposed regulations is intended to be in force within one year of the final publication in the Canada Gazette. The lack of clear timelines is consequential and could compromise adoption. Clearly published and implemented timelines are an important next step that will ensure all institutions understand the government’s expectations for readiness and implementation. As a result, institutions of all sizes can prepare to meet those timelines and objectives while avoiding a situation whereby important investments are being made without assurance that new products can be launched.

The implementation of open banking in Canada is happening alongside other reforms that will collectively result in the most significant modernization of Canada’s financial infrastructure in a generation. The Real-Time Rail launch and open banking have complementary roles and objectives that 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. With that in mind, the Department of Finance should consider the cadence and timing of Payments Canada’s RTR launch, and also consider mirroring the establishment and communication of timelines to help ensure the accountability and readiness of participating institutions. Additionally, implementing these reforms in concert, where possible, will enable consumers to understand the full benefits and make financial decisions accordingly.

Several peer countries have demonstrated the mutually reinforcing benefits of open banking underpinned by real-time payments:

Canada could look to peer countries like the United Kingdom to help inform its timelines and process across multiple initiatives that will support financial services modernization.
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RECOMMENDATION 2

Establish consumer-focused authorization performance benchmarks

Under the proposed regulations, the entity requesting data is responsible for obtaining the consumer's express consent and for securely receiving the data; the entity providing the data is responsible for authenticating the consumer and for securely providing the data. The proposed regulations also require data providers to employ identity and access controls, including multi-factor authentication, and allocate liability for direct financial loss.

Wealthsimple supports this approach in principle. However, on consent authorization flow, interoperability must be scoped and defined with the consumer journey in mind. Without that approach, authorizing institutions may be incentivized to create barriers to consumer choice. For example, the requester now holds the primary financial relationship with the customer and ultimately bears the commercial consequence of a failed connection. However, the institution that controls the authentication and authorization journey the consumer must complete is the provider. A slow provider that inserts additional, potentially unnecessary, screens that present warnings intended to discourage customers from continuing, or that routes the consumer through a flow that is materially worse than the one it offers its own customers, could have a negative material impact on the consumer. This could ultimately hamper consumer choice. This is not limited to screens; materially worse flows can involve avoidable redirects, timeouts and discouraging warnings intended to deter customer switching.

Canadians expect consistency in the customer experience and all Canadians deserve that, no matter where they bank and invest. We work to provide frictionless journeys and want to help ensure other institutions follow our lead. In order to create that frictionless standard for institutions, the incentive structure needs to change.

Current proposed minimum service level standards do not measure the consumer's experience of authorization. An endpoint can be available 99.5% of the month while the journey a consumer must complete to reach it can be overly onerous, time out or be subject to technical challenges by design. Availability is measured at the interface between institutions; abandonment happens at the interface between the institution and the consumer.

Adding a consumer-focused benchmark would resolve this issue. The benchmark could be simple: a participating entity's consumer-driven banking authorization journey must perform no worse, on completion rate and elapsed time, than that entity's own retail digital sign-in journey over the same period. Requiring both figures to be reported in the annual report alongside the data sharing performance and availability information already prescribed, and designate the benchmark as a provision that may be treated as a violation.

Additionally, standardized consent and authorization screens could help ensure a consistent customer journey.

RECOMMENDATION 3

Move registered accounts into the first phase of in-scope data

What the proposed phasing does

The Gazette posting proposes that “...elements of the framework related to ‘in scope data’ (e.g. accounts) would be also phased in with staggered coming-into-force dates in accordance with the complexity of account type, beginning with deposit and payment accounts, then moving to lending accounts, registered accounts and then non-registered accounts.”

Wealthsimple recommends the reordering of ‘in scope data’ phasing to have registered accounts included in the first phase alongside deposit and payment accounts. If that is not achievable, place them second, ahead of lending accounts, and commit to a binding date for their inclusion.

Registered accounts are among the most standardized account types across jurisdictions

Registered accounts - including TFSAs, RRSPs, RESPs, FHSAs and RRIFs - are defined and constrained by the Income Tax Act. Their contribution rules, withdrawal treatment, eligibility criteria, reporting obligations and permitted holdings are under federal jurisdiction and account structures are consistent across institutions. Registered accounts are, on the specific dimension that matters for standardizing an API, among the most harmonized products in the Canadian financial landscape, and the majority of Canadians who have an account have at least one of these products. According to the Canada Revenue Agency, there are approximately 32 million TFSA accounts.² By including registered accounts in Phase 1, the government can better achieve its aims of ensuring Canada’s financial services system is truly consumer-driven and that the impact of this initiative is felt by as many Canadians as possible.

The consumer cost of deferral

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 continues to support CIRO's call for a 10-business-day standard for transfers in good order, and for mandatory compensation when that standard is not met.
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​Deferring registered accounts leaves the accounts most utilized by Canadians outside the framework during the period when consumer adoption and confidence is being established. For many clients, including the lower-income and financially stressed households who are expected to benefit most through access to lower-cost products and clearer choices, the registered account is not one product among several; it can be the primary, if not only, investment account they hold.

The consequence is not necessarily that these consumers simply wait. It is that they may continue to use screen scraping for the accounts the framework does not yet include. Every month that registered accounts sit outside scope is a month in which a consumer who wants an aggregated picture of their finances has an affirmative reason to keep handing over investment account credentials. The longer registered accounts are excluded, the longer screen scraping is likely to persist. That directly undercuts the consumer protection and safety objectives of the Consumer-Driven Banking Act, and it also weakens the competition objective, because credential sharing is the mechanism by which incumbents' data advantage is currently maintained on the least secure terms available.

Demonstrating leadership by bringing registered accounts forward to Phase 1 would be consistent with the government’s leadership on banning transfer fees. Leadership on these combined issues would have a positive, lasting impact on Canadian consumers.

FURTHER COMMENTS

Ensuring the consumer remains at the heart of data sharing provisions

Generally, Wealthsimple supports the idea of creating exceptions to the duty to share, permitting a participating entity to refuse an initial request or stop providing data despite valid consumer consent, where there are reasonable grounds to believe that sharing would cause physical, psychological or financial harm to the consumer; where there are reasonable grounds to believe sharing would create risks to the security, integrity or stability of the framework or of the entity's information and communication technology systems; or where the consumer's accounts have been blocked or suspended. However, consent must be defined in a way that reflects open banking's purpose: putting control back in the hands of the consumer. With that in mind, harms should be clearly defined and reflect existing laws, including current privacy laws.

Wealthsimple encourages the Department of Finance, and where applicable, the Bank of Canada, to further refine the proposed regulations and accompanying policies to consider consumer impacts. First, psychological harm is currently undefined and would benefit from a clear definition to ensure consumers can expect the same standards and support across participating institutions. Second, the notification duty ensures that the Bank of Canada has a line of sight into invocations of this exception, but it fails to define what actions the Bank may take when they form a pattern. For example, as the Department of Finance has currently conceptualized it, an institution that declined several account transfer requests on the grounds of harm would remain within the bounds of regulation while making the experience unreliable enough to deter consumers from using it. If the institution is experiencing significant outflows, they may be incentivized to create more barriers through means such as harm grounds. Additionally, as the proposed regulations are currently drafted, affected consumers would have no clear recourse. At a minimum, the Bank of Canada could publish aggregate invocation rates by participating institutions; provide consumers with a route to the external complaints body where they believe a refusal was unfounded; and designate patterned or unsubstantiated invocation as a provision that may be treated as a violation.

Ensuring regulatory coherence and harmonization

The institutions participating in the Consumer-Driven Banking Framework are likely already regulated by one, if not several, regulators and standard-setters. As noted by the submission put forward by the Canadian Forum for Financial Markets, the proposed regulations should be implemented in a manner that promotes coordination among overlapping regulatory regimes, including through harmonized guidance, aligned definitions and thresholds, single-window reporting where possible, and deemed or substituted compliance for obligations that are already addressed under another regulatory framework. This would preserve effective oversight while reducing unnecessary complexity, cost, and fragmentation for participants already subject to comprehensive banking, payments, securities, privacy, AML/ATF, or complaints-handling requirements.

CONCLUSION

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.

Open banking, along with the RTR and the investment account transfer fee ban, represents the most significant modernization of Canadian financial services in a generation aimed at fostering competition in a sector that has traditionally lacked it. ​

Wealthsimple appreciates the opportunity to comment on the Department of Finance’s proposed regulations, and we would welcome the opportunity to discuss any of these recommendations in further detail.
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​¹ https://www.canada.ca/en/department-finance/programs/financial-sector-policy/open-banking-implementation/budget-2024-canadas-framework-for-consumer-driven-banking.html ​
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​² https://www.canada.ca/content/dam/cra-arc/prog-policy/stats/tfsa-celi/2024/tfsa-tbl1a-2024-en.pdf