Mortgage Broker is the magazine of the Canadian Mortgage Brokers Association and showcases the multi-billion dollar mortgage-broking industry to all levels of government, associated organizations and other interested individuals.
Issue link: http://digital.canadawide.com/i/1078044
8 | winter 2019 cmba-achc.ca CMB MAGAZINE editorialsummary Are You Ready for Open Banking? Finance asserts that: Open banking is a framework where consumers and businesses can authorize third-party financial service providers to access their financial transaction data, using secure online channels. e benefit to consumers and businesses is that it allows them to access new products and services that enable them to better manage their financial affairs. In jurisdictions that have adopted open banking systems, participating service providers must meet standards with respect to privacy, security and operational stability. In a nutshell, an open banking environment is one where a multitude of financial technology (fintech) developers can plug into the vast troves of financial data available from the banks, parse it to discover novel information about consumer habits such as spending, savings and investing, then package those insights into personalized services available to their users. Imagine downloading the latest app that could analyze your credit-card payments and recommend ways in which you could save on interest, or an app that would seek out investment opportunities tailored specifically to your risk tolerances, income goals and ethical values. Imagine having a full picture of where your business wasted money last year, or a recap of your best financial decisions to date. ese are the kinds of innovations that open banking technology is poised to deliver. For an example, let's consider the future of mortgages and how open banking might assist prospective borrowers to make better informed decisions. Finance Canada provides the following detailed illustration: Dominique and Addison are parents of one child with another on the way. Dominique D o you ever get the feeling that the world around us is evolving with such speed and intensity that it's impossible to keep up? For many years, Canada's financial sector has been sheltered from the frenetic pace of change experienced by many other businesses. is industry has been a bastion of conservatism, where tried and tested business practices, predictability, stability and relationships cultivated cautiously over time have continued to be the norm. During the first two decades of the 21st Century, the Canadian financial sector has, for many practical and legal reasons, been reticent to embrace the transformative technological trends reshaping our daily lives, however, as we enter the 2020s, there is a plethora of new ideas and innovations bubbling under the surface that are poised to reimagine the way we borrow, spend and plan our financial futures. Other countries and unions of nations have been at the forefront of new paradigms in banking, including the United Kingdom, the European Union, Japan and Australia. Until recently, Canada's banking industry seemed like an unlikely candidate to be among the vanguard, but many were surprised when the Department of Finance recently took an important step forward by launching a public consultation on the merits of open banking. But what exactly is open banking, and what does it mean for the mortgage brokering and lending sector? e Department of Digital disruption is finally coming to Canada's financial services sector BY SAMANTHA GALE API Data Protection FINTECH finance privacy