Mahi Sall, Advisor, Fintech-Bank Partnerships, Payments and Financial Inclusivity
January 25th, 2023
Mahi Sall is the CEO & Founder of FinXpair, a Berlin-based strategic advisory boutique firm focu[...]
FinTech Executives Disappointed with Budget 2023’s Lack of Open Banking Update, Raising Doubts on Delivery Timeline
Betakit | | Mar 29, 2023
Image: FFCON21 Panel on consumer credit
Working groups resume April 14th, but open banking lead departs in September
- Canadian FinTech CEO Andrew Graham is tired of waiting for open banking to become a reality in Canada. He’s not alone. More than half a year after Borrowell launched an offering that allows Canadians to use their rent payments to build their credit score, Graham said it has seen significant challenges — ones that a formalized open banking system could resolve.
- Borrowell’s Rent Advantage program, announced in July 2022, allows users to report their monthly rent payments, using data from their bank accounts, to Equifax Canada, the country’s largest consumer credit bureau. Without a formal open banking system in place to dictate a standard API—a secure way for FinTech startups and other third parties to access users’ financial data—Borrowell has had to rely instead on screen scraping.
- With one large bank, which Graham declined to name, the company is seeing a 75 percent failure rate. And over time, he said, using screen scraping for bank account connections tends to stop working: more than 40 percent of the company’s Rent Advantage users have to reconnect their account each month.
See: FFCON21 Panel: Inclusive Banking and Affordable Credit
- Late: But despite the open banking advisory committee’s call for the federal government to move aggressively to implement the first phase of the system by January 2023, and the Liberal Party’s 2021 election promise to implement a made-in-Canada model “no later than the beginning of 2023,” the system remains delayed. The federal budget, tabled yesterday, didn’t include a mention of the future system.
- A delayed timeline only underscores Tachjian’s 18-month secondment from PwC, which is set to end in September. The finance department confirmed to BetaKit in September 2022 that Tachjian plans to return to the private sector at the end of his term.
Fintech Executive under Chatham house rule at Northwind event:
“This is a political will issue in my view. … If open banking was a real priority, we would already have it,” the executive said. “January 2023 was the target in the advisory committee report. But ultimately these are not things the Minister of Finance seems to really prioritize.”
See: NCFA Open Banking Future Outlook with Senator Colin Deacon and Mahi Sall
Finance Canada says:
Tachjian’s “focus continues to be on the work required to support the government in its commitment to presenting a read-only model of open banking in 2023.” The official said open banking working groups — which have focused on accreditation for participants, privacy, liability, and security standards for the system — will resume meeting on April 14.
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