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Government efforts to encourage 'Open Banking'
'Open Banking' may not be a term that is known or understood by everyone. Simply put, it is the ability to access your money and financial account data through third-party applications. As you might expect, that kind of access is very important to the success of the Next Gen ATM initiative, which shifts the user interface of the ATM to the consumer's mobile device.
More specifically, Investopedia defines 'open banking' as "a banking practice that provides third-party financial service providers open access to consumer banking, transaction, and other financial data from banks and non-bank financial institutions through the use of application programming interfaces (APIs). Open banking will allow the networking of accounts and data across institutions for use by consumers, financial institutions, and third-party service providers. Open banking is becoming a major source of innovation that is poised to reshape the banking industry."
The Canadian government should be commended for taking such a proactive approach to this new reality. The Department of Finance Open Banking Advisory Committee released its Open Banking Report late last year, which included a recommendation for a preliminary system by 2023. Building the consensus for agreement that something had to be done regarding open banking was a big achievement. The report also calls for creation of an Open Banking “Czar”, which is an unusual designation for a Canadian government position.
Open banking is predicated on the principle that an individual has the right to control, edit, manage, and delete information about themselves and decide when, how, and to what extent this information is communicated to others. In Canada, this right flows from the data mobility principles the Government first laid out in the Digital Charter and proposed in Bill C-11 through the Consumer Privacy Protection Act.
We agree with the report, that an open banking system in Canada should improve both economic outcomes and consumer welfare. It should advance economic development by increasing overall growth in the financial sector, moving beyond older, less secure technologies. At the same time, open banking is expected to enhance the customer experience by enabling access to new and innovative financial services in a way that is secure, efficient, and consumer-centric.
Anti-cash statements during COVID-19 outbreak
In the midst of the initial COVID-19 outbreak, Quebec Director of Public Health and Assistant Deputy Minister, Mr. Horacio Arruda, publicly warned against using cash as it could spread COVID-19. While ATMIA appreciates he is under pressure dealing with the health crisis, and fully support his broader message of individual diligence to reduce the spread of COVID-19, these words were reckless and further and unnecessarily undermined the economy in a time of crisis.
On the same day, the Bank of Canada clearly stated: “The risks posed from handling Canadian banknotes are no greater than those posed by touching other common surfaces such as doorknobs, kitchen counters and handrails.” (see full statement here: https://www.bankofcanada.ca/2020/03/bank-canada-asks-retailers-continue-accepting-cash/).
ATMIA asked that Mr. Arruda immediately correct his statements and for the Federal and Provincial Finance Ministers, and all merchant and business groups to step up immediately and join us and the Bank of Canada to ensure that any risks of cash are put in honest context for Canadians and that we are not further undermining the economy and chances of economic recovery by letting these unfounded and reckless comments take hold in the media and minds of Canadians.
Letters were sent to the Finance and Health ministers of each province and federal government, cautioning them to not drive a loss in confidence in cash or it will slow the recovery. They were signed off on by ATMIA Canada Executive Director, David Tente and ATMIA Canada Regional Board Co-chair, Chris Chandler. Hill and Knowlton was instrumental in helping ATMIA Canada turn around these letters and ensure that the future discussion around cash is driving a return to consumer confidence – and merchant’s enthusiastic acceptance of cash post COVID-19.
Responses have been received from Manitoba, New Brunswick, and Saskachewan.
The Ontario Provincial Police, the police force for the largest province in Canada, had a regional unit send out flyers discouraging businesses from hosting ATMs in their businesses. The flyer was overly negative and said ATMs were not worth the risk and did not bring in enough money to warrant hosting one in your business.
H+K reached out to the OPP on ATMIA's behalf and tracked down where this flyer came from. What made it complicated was that the flyer was not created in their communications department and had not followed the correct process for approvals. After a fair bit of searching and outreach, they discovered that the Western Region, representing communities west of Toronto, like London, Brantford, Kitchener, Waterloo had taken it upon themselves to distribute these flyers after a rash of the thefts.
H+K arranged a call with the OPP inspector tasked with oversight, and compiled comments from ATMIA to design a new flyer that had approved ATM safety language. They have now taken these comments and created a new draft. Their ultimate focus is safety, and while there is still a tone of risk, all of the comments that explicitly discouraged hosting ATMs have been removed, and an emphasis has been put on preventative actions.
We also were adamant that the OPP acknowledge the problem with their initial flyer. In response, the OPP sent us an apologetic letter and a committment to work with us in the future.
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