A long-promised revolution in banking is headed to Canada, but you might not notice when it arrives, was the sinister headline to a recent The Canadian Press article.
The change that is in the works is something called “open banking” and the Canadian federal government has promised framework legislation in next month’s budget to bring the system to Canada.
Under open banking, banks allow access and control of customers’ personal and financial data to third-party service providers.
One of the biggest areas of growth is in credit assessments, The Canadian Press reported. “Under open banking, lenders could directly access an individual’s banking data, so they can look beyond credit scores. Consumers can also use it to build their credit scores, for example by providing reliable rent payments.”
The Canadian Press article quotes Helen Child – co-founder of Open Banking Excellence (“OBE”), a forum for those working in the system – to promote open banking.
OBE promotes itself as: “We’re more than a PR agency, we’re your community.” By “your” they don’t mean us, they are referring to potential partners. Who are its partners?
“We’ve been boosting the Open Banking profiles of some of the biggest names in the industry for over three years,” OBE boasts. Its LinkedIn page claims it is “the largest and most engaged community of Open Banking and Open Finance pioneers in the world. From fintechs and banks to regulators and bigtechs [sic], our community gathers to learn, share stories, spark debate and collaborate.”
In a July 2020 interview, co-founder Child admitted that Open Banking Excellence capitalised on the covid pandemic in the UK and had expansion plans. “We plan to launch in AsiaPac … The UK created the blueprint for Open Banking. We can share our learnings, talent and experience with the rest of the world, and launching OBE in other parts of the world allows us to do that,” she said.
Of course, open banking advocates such as Child who have a vested interest will make out that open banking is for our convenience. But is it?
As Investopedia notes, open banking poses severe risks to financial privacy and the security of consumers’ finances. The Canadian Press omitted to inform the public about these risks. Fortunately, independent media in the form of Armstong Economics is alerting us.
Child’s Open Banking Excellence is operating in 40 countries, Armstrong Economics warns. Open Banking is effectively paving the way for social credit systems.
Read More: Canada’s “open banking” is paving the way to a national social credit system