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In its 2025 Federal Budget ("Budget 2025"), the Government of Canada (the "Federal Government") announced new details about its plans for implementing an open banking framework in Canada.1 Open banking, also known as consumer-driven banking, would enable consumers and small businesses to opt in to securely share their financial data with approved service providers, such as financial technology companies.2
The Federal Government reiterated its commitment to advance open banking by introducing legislation to complete the Consumer-Driven Banking Act ("CDBA"), extending the framework to include payment initiation by mid-2027, moving oversight to the Bank of Canada, and proposing relevant amendments to the Personal Information Protection and Electronic Documents Act ("PIPEDA").
The State of Open Banking in Canada
Despite several years of consultation, Canada remains in the pre-implementation stage.3
In the 2024 Fall Economic Statement, the Federal Government announced plans to launch an open banking framework in early 2026. The first part of the CDBA, which established the framework's structure, received royal assent in spring 2024.4 However, progress paused following the prorogation of Parliament in January 2025.
Key 2025 Budget Highlights to Open Banking
The Federal Government has made several updates to its forthcoming open banking framework in Budget 2025.
- Change in Regulatory Oversight: The open banking framework will be delegated to the Bank of Canada, marking a shift from earlier plans for the Financial Consumer Agency of Canada ("FCAC") to act as the lead regulator. The Bank of Canada already has a supervisory role regarding registered payment service providers and the Retail Payment Activities Act, making it well-positioned to oversee both payments and data-sharing frameworks. The shift will streamline governance and accreditation as open banking becomes a part of Canada's financial structure.
- Financing Allocations: The Bank of Canada will retain up to $19.3 million over two years to support the implementation of open banking. The remaining funding of $36.9 million that had been previously allocated to FCAC in the 2024 Fall Economic Statement will not be spent.
- National Security Safeguards: The CDBA will have built in national security safeguards. The Canadian Security Intelligence Services and the Royal Canadian Mounted Police will assist with monitoring and responding to potential threats, including fraud, misuse, and cyberattacks, involving consumer data shared through open banking. Budget 2025 proposes to provide $25.7 million over five years, beginning in 2025-26, and $5 million ongoing to support the security safeguards.
Legislative Changes
Additionally, legislative changes to the CDBA will be introduced through the 2025 Budget Implementation Act including legislating "write access," which enables consumers to direct actions such as creating an account or initiating a payment.5 Write access is expected to be available by mid-2027 once Canada's Real-Time Rail project, a forthcoming instant payments system, is live and in use.6
Additional amendments will focus on accreditation and rules involving security, national security, liability, and consent.
Data Mobility
Budget 2025 also signals the Federal Government's intent to amend PIPEDA to provide a data-mobility right that will facilitate an economywide approach to data sharing.
The liberal government has been trying to build a data mobility right into PIPEDA for some years. Recent attempts to amend PIPEDA, in the form of the Consumer Privacy Protection Act, would have included a right for individuals to require organizations to transfer data to other organizations upon request, if both organizations were subject to a data mobility framework.7
Both previous attempts to implement the Consumer Privacy Protection Act died on the order paper. It is yet to be seen whether this data mobility right will be introduced as part of budget implementation legislation, or as part of another attempt at a comprehensive PIPEDA overhaul (which government officials have signaled is on the horizon).
Conclusion
Open banking will demand regulatory expertise, technical understanding, and cross-sector coordination. While much of the technical requirements, including the development of accreditation requirements, are still in legislative development, Budget 2025 underscores the Federal Government's commitment to review and implement open banking, which is expected to support innovation, competition, and consumer choice by increasing data sharing capabilities and access to financial services.
Footnotes
1 Government of Canada, Canada Strong Budget 2025.
2 Government of Canada, Open banking.
3 McMillan LLP, Open for Business? An Overview of Open Banking in Canada.
4 Government of Canada, Consumer-Driven Banking Act.
5 Advisory Committee on Open Banking, Final Report (April 2021).
6 Government of Canada, Budget 2025: Canada's Consumer-Driven Banking Framework, S.C. 2024, c. 17, s. 198.
7 McMillan's Privacy and Data Protection group published summaries of the last attempts to amend PIPEDA. See Bill C-11 and Bill C-27.
The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.
© McMillan LLP 2025
