EQB Investor Relations - Open Banking

Open Banking will change the way Canadians experience digital banking. The user experience will be much more seamless, efficient and secure. The streamlined data sharing in the financial ecosystem will bring more choices of financial products for Canadians and spur new innovations.

Canada’s Open Banking journey has been sluggish so far, as compared to other jurisdictions around the world. With a customer centric approach, the open data economy would ensure a fair market with user-permissioned data available for newer and smaller players bringing innovation and cost reduction in the industry.

Equitable Bank, Canada’s Challenger Bank^TM believes Open Banking will have a significant positive impact on the economy by improving the product offerings tailored to customer needs and giving more control to consumers.

What is Open Banking?

Open Banking is a trusted framework for Banks and third parties to securely exchange data for customers’ benefits

Why should it matter to Canadians?

Open Banking empowers customers and businesses by enabling access to innovative financial products tailored to their needs

Use cases powered by Open Banking

Personal Finance Management
Bill Payments and Cashflow management
Rewards Management

A single platform to manage all your different accounts held with different financial institutes. Without switching to multiple banking apps or websites, you can have a single view of all your accounts, their balances, recent transactions, statements and much more. All of this without any risk of sharing your credentials with any intermediary or third party.

Do you find it cumbersome to interact with multiple service providers for the bill payments every month? Imagine a single super app which brings all your Payees together and helps you manage payments while keeping an eye on your cashflow.

You also get proactive alerts if your account does not have enough balance for the upcoming bill to avoid any overdraft or non-sufficient funds fee.

Who doesn't like rewards? Only to be inconvenienced by the fact that every brand you shop with or every credit card you use to pay has their own reward program. With so many reward programs, the user experience becomes daunting rather than rewarding.

Wouldn’t it be great to have a solution managing these reward programs for you? A product that collates all your rewards in one place and helps you redeem them whenever you shop so that you spend better and save better.

The Government of Canada's approach to Open Banking

The Canadian Government has acknowledged the consumers' right to use and move personal data for their own benefit. The right of data portability is included in Canada’s Digital Charter and was proposed in Bill C-11. The risk with the existing mechanism of screen scrapping, where consumers have to share their credentials with other parties has also been acknowledged.

The Government first declared its interest in Open Banking in the 2018 Federal Budget. In 2019, the Senate produced a well-researched report urging decisive government action. In parallel, the Minister of Finance commissioned a report from an expert advisory panel.

In 2021, the advisory committee to Finance Canada published its final report on Open Banking. With 34 recommendations and a target date of January 2023, the advisory committee did a great job in providing clarity and direction for the next steps on the roadmap. The callout is for a collaborative approach between Government and industry to ensure an overarching mandate and the flexibility for innovation. This has been called a made-in-Canada hybrid approach.

The committee has recommended a phased implementation of Open Banking so that the execution is not too long, and the associated risks are well considered. The first phase could be limited to read-only access scope, for example, account information service providers will be able to obtain the user permissioned account details. Though to realize the full potential of Open Banking, it becomes crucial that the write access remains in the roadmap where service providers will be able to initiate payments or request for account opening on behalf of customers.

Unlike in other markets, where participation from banks has either been optional or limited to big banks only, it is recommended to mandate all the federally regulated banks in Canada to participate in the ecosystem as data providers. The mandatory participation will ensure data availability from day one.

Equitable Bank - An advocate for Open Banking in Canada

EQ Bank is a strong supporter of Open Banking in Canada and the benefits it will bring to Canadian society. Given our Challenger Bank culture, our agile and scalable technology infrastructure, and our security posture, EQ Bank is in a unique position to innovate and create a better banking experience for Canadians when Open Banking arrives in Canada.

EQ Bank value proposition in Open Banking ecosystem:

(i) Partnership for products and services: Open Banking opens avenues for EQ to partner with other entities to provide new products and services to its customers via its platform. EQ Bank’s philosophy is anchored in leveraging partnerships for innovative products and services.

(ii) EQ product and service availability: By exposing its own product and services at external engagement points like product comparison websites, financial products recommendation services, EQ Bank will bring new customers onboard via this channel.

(iii) Fintech-driven user experience backed by EQ products: Fintechs can drive innovation by building customer centric front-end applications and fit for purpose niche products. EQ with its easy-to-integrate open APIs can position itself as a white-labeled banking product servicer for the fintechs. This brings a new customer base for the Bank.