Submission to the Department of Finance Canada’s Pre-Budget Consultations

Executive Summary

Wealthsimple recommends the government immediately implement the ban on investment and registered account transfer fees announced in Budget 2025.

We estimate that in the ten months since the announcement, Canadians have paid more than $250 million in exit fees to move their accounts.¹ The government has acknowledged that these fees average $150 per account,² and that prohibiting them will result in lower prices and better quality services for Canadians.³ Implementing the fee ban without further delay will make financial services more affordable, benefit the least wealthy savers the most, and complement the government’s other reforms to Canada’s financial infrastructure.

As we grapple with the latest US trade tensions, making Canada’s economy more sovereign and resilient requires us to follow through on the government’s commitment to increase competition and reduce the cost of living, including in financial services.

About Wealthsimple

Wealthsimple is Canada’s leading financial innovator. The company offers a full suite of simple, sophisticated financial products across chequing and spending, managed investing, self-directed trading, and tax filing. Wealthsimple serves more than 4 million Canadians, holds more than $155 billion in assets under administration, and employs more than 1,750 Canadians from coast to coast.

About our Clients

Nearly 1 in 4 Canadians aged 18-40 uses Wealthsimple. This reach gives us a unique vantage point on a generation often missing from policy conversations.

1 in 4 millennial clients and 1 in 5 Gen Z clients made regular contributions to their registered accounts last year, and our youngest clients led every other generation in their use of automated investing. Despite cost-of-living pressures, they are putting what they can into TFSAs, RRSPs and other registered and investment accounts to save for their future - even while home ownership, the wealth-building tool that worked for their parents, often feels unattainable.

Our clients value choice, and record rates of inbound and outbound account transfers this year show a generation actively shopping for value in financial services. Delivering on the promised transfer fee ban will directly address this generation’s needs.

Recommendation

Wealthsimple recommends the government immediately implement the ban on investment and registered account transfer fees announced in Budget 2025, for the following reasons:

Financial services fees are at the heart of the affordability crisis.

Canadians pay some of the highest fees for financial services in the world. Between monthly fees for basic services, high fees for ATM withdrawals, e-transfers and wires, NSF and overdraft fees, high fees on mutual funds, and large commissions on self-directed investments, Canadians are being systematically gouged whenever they manage their own money.⁴

The result is a movement of capital from ordinary Canadians and businesses into excess profits for the largest financial institutions. Canada’s six largest banks earned a total of $70 billion in net income in 2025.⁵ All six have beaten analysts’ revenue estimates for the last five consecutive quarters. Bank revenues account for 8% of Canada’s GDP, compared to an average of 5.6% among the largest developed economies. Their annual return on equity is 16% compared to an average of 10%. And the ROE of their domestic retail businesses reaches 30-40%, compared to only 8-9% for the US retail operations of the same banks.⁶

Meanwhile, Canadian households are spending an average of $740 per year on financial services.⁷ Excess financial fees represent household income that could otherwise be spent on groceries, childcare, or recreation, or saved for a home, retirement, or a child’s education. Tackling them should be regarded as an urgent political priority in the current affordability crisis.

Of course, there is no silver bullet to reduce excess financial fees across the board. Instead, the government must make targeted interventions for maximum impact to consumers. Exit fees represent just such an opportunity. At an average of $150 per account transferred, exit fees are felt immediately and acutely by consumers, and have an obvious and intended chilling effect on consumers’ appetite to move their accounts between providers - often exposing them to higher fees in the long run. Their removal will have a significant impact on the affordability of saving and investing products, both for those who transfer, and for those who benefit from additional competitive pressure on savings rates, management fees, trading commissions and more.⁸

The delay is costing Canadians millions.

Since Budget 2025, Canadians have been charged more than $70 million in exit fees for moving their accounts to Wealthsimple. (Wealthsimple does not charge departing clients a fee.) Extrapolated across the sector, the cost to Canadians of the delay in implementing the ban is in the hundreds of millions of dollars.

The Budget 2025 Impact Report suggested that “Canadians holding registered and investment accounts, which are more prevalent among higher-income people, may disproportionately benefit” from the prohibition of transfer fees.⁹ To the contrary, transfer fees disproportionately hit the youngest and least affluent savers the hardest. The industry standard practice is to reimburse transfer fees for those transferring large amounts, often of $25,000 or more. CRA data indicates the average TFSA balance only crosses $25,000 once the plan holder reaches 50.¹⁰

In fact, younger and less wealthy Canadians are the real beneficiaries of the transfer fee prohibition. They are working hard to get ahead and save for the future, and they deserve to choose a financial services provider to support them, freely and without penalty.

The $10 cap on NSF fees, which Wealthsimple supported and welcomed, provides a cautionary precedent. The cap was announced in April 2024, but only came into effect this March. According to government estimates, the cap will save consumers $600 million per year.¹¹ By that measure, the delay from announcing the cap to implementing it cost Canadians more than a billion dollars. That is a lack of urgency our country can no longer afford.

The transfer fee ban is a critical part of the Prime Minister’s reform agenda.

Wealthsimple fully supports the government’s efforts to modernize Canada's financial infrastructure, including through Consumer-Driven Banking, the Real-Time Rail, the Stablecoin Act and more. Wealthsimple has demonstrated a commitment to supporting these initiatives in practice, both by participating in the policy process (e.g. as a member of the Department of Finance's Open Banking Task Force) and by building the internal infrastructure needed to participate in these systems.

The transfer fee ban is critical to realizing the consumer benefits of these infrastructure improvements. If Canadians remain locked into financial products and providers that do not serve them by arbitrary, anti-competitive, and unregulated fees, improvements to financial infrastructure will fall short of the desired effect. To meet the Prime Minister’s commitment to “increase competition for the hard-earned dollars of Canadians, in telecom, in banking, in retail, across our economy,”¹² all these pieces need to work together: data portability, instant payments, and freedom of choice.

Conclusion

The implementation of the prohibition on registered and investment account transfer fees should be an urgent priority leading up to the publication of Budget 2026. Canadians are bearing the nine-figure cost of the delay, while financial institutions continue to generate excess profits from fees the government has already determined are unjustifiable. As Canada navigates an ever more fraught economic and trade environment, the government must prioritize this opportunity to improve affordability for ordinary Canadians, while making our financial services sector more competitive and our economy more resilient. ​
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​¹Estimate based on: i) the number of account transfers to Wealthsimple since November 4, 2025, ii) the average transfer fee charged to incoming Wealthsimple clients in calendar 2025, and iii) an assumption that transfers to Wealthsimple as a share of all investment account transfers in Canada represent a maximum of 10x Wealthsimple’s market share of the combined assets under administration of CIRO member firms.
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​²Budget 2025, page 117.
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​³Budget 2025 Impacts Report, page 23.
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​⁴Wealthsimple, print campaign in the Globe and Mail, August 2026.
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​⁵CBC, How Canada’s Big 6 banks made a ton of money in 2025, December 2025.
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​⁶McKinsey & Company, Springtime for Canada’s fintech industry?, April 2024
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​⁷Statistics Canada, Household spending, Canada, regions and provinces, May 2025.
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​⁸Budget 2025 Impacts Report, page 23.
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​⁹Budget 2025 Impacts Report, page 23.
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​¹⁰Canada Revenue Agency, Tax-Free Savings Account 2025 Statistics (2023 contribution year).
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​¹¹Department of Finance Canada, Minister Champagne announces new $10 cap on NSF fees and other measures to lower banking costs for Canadians, March 2026.
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​¹²CPAC, PM Mark Carney addresses Liberal caucus ahead of Parliament’s return, September 2025.