Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
CSA Seeks Industry Input on Data Portability Consultation
Data Portability | Feb 19, 2025
Image: Freepik
CSA's Launches the Collaboratory and First Testing Initiative on Data Portability
Investor data is suck in silos and the Canadian Securities Administrators (CSA) is looking to gain more insight with a newly launched data portability testing consultation (CSA Multilateral Discussion Paper 11-406) to explore the ability for investors to move their financial information seamlessly between firms. Right now, switching investment providers often means filling out mountains of paperwork. If data portability moves forward, that could change.
This consultation is the inaugural testing initiative from the CSA's "Collaboratory" and is asking industry participants such as investment firms, fintechs, and investor groups to weigh in on how data portability could work, what risks it brings, and how regulations may need to evolve.
See: Primer on Quebec’s New Data Portability Law
Interestingly, participating provincial regulators in this initiative include Alberta, British Columbia, Manitoba, New Brunswick, Nova Scotia and Saskatchewan. It doesn't appear that Ontario (OSC) is participating, raising questions about whether the country can move forward with a unified approach to financial data sharing given that Ontario represents the largest capital markets in Canada.
What’s This All About?
Simply put, data portability means that investors could request that their personal financial data be transferred from one firm to a different firm, securely, accurately, and in a standard format. It’s similar to what’s happening in open banking (consumer driven finance), where customers can connect their bank accounts to budgeting apps or loan providers. However, today in Canada's investment world data portability doesn't really exist. If you move from one firm to another, you typically have to fill out everything from scratch. The CSA wants to see if an electronic Know-Your-Client solution (e-KYC) could help investors and firms move toward a more seamless and efficient system.
If done right, data portability could make investing easier, faster, and more flexible. Instead of repeating KYC processes with every new investment firm, investors could authorize their data to move with them.
See: Major Data Breach @Finastra and Canadian Banks?
For investment firms, fintechs, and every day citizens, data portability would open up new business models and streamline operations. Imagine a world where firms compete on products, service and returns, rather than who can collect and horde your data the best.
- But it’s not that simple. There are risks and the CSA is looking to tackle these questions before jumping into a full rollout.
- Privacy is a major concern. Who owns the data? How do you prevent unauthorized access?
- Regulatory challenges. Securities laws require firms to conduct their own KYC checks. How would data portability change that?
If data is more portable, does it increase security risks? Is it more vulnerable to breaches and fraud?
Is Ontario Sitting Out a Red Flag?
Given that Ontario isn't participating in this consultation is a red flag because Ontario represents Canada's largest capital market(s) in the country. We've seen it before where not all provincial regulators agree and decide to forge their own path which can cause regulatory friction and increased costs to operators who must comply with varied provincial regulatory requirements. Think back to when Canada rolled out equity crowdfunding regulations with 3 different sets of rules. The result? It confused markets and increased costs to the point where it hurt equity crowdfunding markets before they even had a chance to get off the ground.
The Ontario Securities Commission and the CSA should be forth coming with why they aren't participating. Is Ontario in fact taking a different approach to fintech regulation? Or do they have different priorities than concerns about data portability privacy, fraud risks, or other regulatory conflicts? Given that Open Banking is set to launch in 2026, these data portability consultations and potential tests would surely inform final rule making and implementation requirements. Maybe Ontario is waiting to see how open banking rules land and align with those.
One things for sure, industry certainly cannot afford increased friction at a time when interprovincial barriers are already costing Canada the equivalent to a 21% trade tariff.
What Happens Next?
There are 3 phases rolling out:
- Consultations are taking place now until May 19, 2025. Feedback will be gathered.
- Industry roundtables and discussions with market participants on the risks, benefits, and solutions.
- Live testing (possibly) - assuming there's enough interest, a pilot program may be run to test real world applications of data portability in practice.
See: Open Banking: Revolutionizing Financial Data Sharing
Of course, there may be required changes to current regulations to support a robust and secure system underpinning open banking, if required.
Closing thought
This is an important initiative that investors, fintechs, and established financial firms should care about and participate in as it will give investors and every day people more control over their financial data while making switching providers easier. For fintechs and financial firms it will mean opportunities for new products and services including those around investment, digital banking, digital identity, e-KYC and similar compliance tech. It will also mean new challenges as regulations are finalized. Read the 15 page PDF discussion paper on data portability here. If your business has a stake in financial data, now’s the time to get involved.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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