FinTech Study

This publication can be made available in alternative formats upon request. Contact the Competition Bureau's Information Centre.

We want your input . . .

...stay tuned, our draft report is coming out shortly.

FinTech in Canada

  • Financial services account for 7% of Canada’s GDP and 800,000 Canadian jobs

The FinTech promise

  • Potential for a more competitive marketplace
  • Lower prices and more choice for Canadians to manage their money

What is FinTech?

FinTech refers to innovative technologies being introduced by incumbent financial institutions, service providers and new entrants to enhance the efficiency of the financial services market. It is a technological advancement that redefines what financial services are, and how they are delivered to consumers.

Disruptive innovation

With the increasing demand for more flexible financial products, we have seen a global explosion of FinTech adoption over the last few years.

Disruptive innovation is empowering. It seeks to transform products and services that historically may not have been the most efficient, and in many cases, may have been difficult to access. It promises increased choice, convenience and lower prices for consumers.

We now see start-ups and SMEs providing products and services that were previously only offered by established financial institutions.

As evidenced in other countries, FinTech has the potential to positively change the way Canadians access financial services. At the same time, new models can bring new risks.

The Competition Bureau’s study provides advice and guidance to financial sector regulators and other relevant authorities on how to ensure that regulation does not unnecessarily impede innovation and competition in the sector.

The study focuses on three main areas:

  1. Retail payments and retail payment systems
  2. Lending and equity crowd funding
  3. Investment dealing and advice

To complement its law enforcement activities, the Competition Bureau participates in a wide range of activities to promote and advocate the benefits of a competitive marketplace, both in Canada and abroad.

Why do the study?

  • Provide recommendations to encourage competition and innovation in the financial services sector
  • Identify potentially unnecessary barriers to entry, expansion and adoption
  • Inform Canadians about new products and services available to them as well as emerging risks

Who can benefit from the study?

  • Financial services regulators and policy makers
  • Canadian businesses
  • Canadian consumers
  • Governments

Market Study Highlights

  • 228 FinTech workshop attendees
  • 130 Stakeholder interviews
  • 13 Outreach events
  • 10 Information sessions
  • 9 International consultations

A preview of what’s to come

Striking the right balance means that regulators and policy makers protect Canadians while promoting innovation. These recommendations were informed by significant stakeholder engagement and the Competition Bureau’s 2017 FinTech workshop.

  1. Rules that are technology‑neutral open the door to more innovative offers today and down the road.
  2. Principle-based regulation allows regulators to be more flexible in their approach to enforcement as technology changes.
  3. A function-based approach to regulation ensures that businesses that perform the same function face the same regulatory burden, and consumers receive the same protections.
  4. Regulations proportional to the risks associated with an activity allow smaller players and limited-function competitors to innovate, grow, and compete.
  5. Harmonized regulation can facilitate entry and expansion of FinTech across Canada and abroad.
  6. Regulatory approaches such as regulatory sandboxes and innovation hubs facilitate entry.
  7. A clear and unified policy lead for FinTech identified in Canada would facilitate entry and promote innovation, competition, and investment.
  1. Greater access to core infrastructure and services (e.g. the clearing and settlement system) eases development of new and innovative FinTech services.
  2. Open access to systems and data through application programming interfaces facilitates customers’ ability to shop around and switch service providers.
  3. Digital ID verification will help reduce the cost of customer acquisition for service providers, reduce the cost of switching for consumers and facilitate regulatory compliance processes.
  4. More frequent review of regulatory frameworks helps ensure that they remain relevant.

"The future is now. Let’s get it right by providing policy makers with the information they need to nurture a competitive environment that allows Canada’s FinTech companies to innovate and grow globally."

John Pecman
Commissioner of Competition

What’s next?

The Bureau will be releasing a draft report for public consultation in the coming weeks. Stay tuned and follow us!

Date modified: