News Summary

The Canadian federal government’s Budget 2025 has introduced key initiatives aimed at enhancing the competitiveness and innovation of the country’s financial system, particularly benefiting the FinTech sector. The budget includes major developments in open banking, real-time payment systems, and stablecoin legislation. Open banking in Canada is set to progress to ‘phase two’ with a legislative framework targeting mid-2027 for ‘write access.’ This will allow consumers to securely share financial data with third parties, increasing competition and reducing costs. Responsibility for overseeing open banking will shift from the Financial Consumer Agency of Canada to the Bank of Canada, enhancing system supervision. Additionally, the budget promises the operation of the Real-Time Rail system by 2026, which will facilitate instant payments. The government is also moving swiftly to regulate stablecoin issuance, requiring issuers to maintain asset reserves and implement consumer protection measures. This move is seen as a step towards positioning Canada as a leader in digital innovation, with industry leaders expressing support for the proposed frameworks.