Answer ... Canada’s developed financial services sector will likely continue to incentivise many fintech innovations. In particular, Canada has seen strong growth in businesses involving cryptocurrency, artificial intelligence and digital payments. Canada’s government has set ambitious innovation goals, with several governmental programmes being created to encourage growth in this sector.
New developments are expected in the form of updated regulatory regimes that will better address the rapid technological innovation seen in the fintech space. Further clarity regarding the regulation of cryptoasset trading platforms is anticipated to be provided by securities regulators. The Canadian federal government has confirmed that it plans to introduce legislation to implement a new retail payments oversight framework, which may result in fintechs that are currently unregulated becoming subject to regulation, depending on their business activities. Amendments to the Proceeds of Crime (Money Laundering and Terrorist Financing Regulations, anticipated to come into force on 1 June 2020, will impose obligations on reporting entities with respect to virtual currency transactions.
In early 2019 the federal government released a consultation paper on a review of the merits of open banking, seeking comments from industry stakeholders. While recent elections in Canada have caused progress on this initiative to lag, industry participants are keen to see movement forward.