Federal Government Review of Open Banking Opportunity a Leap in the Right Direction.According to PwC's 2017 Global FinTech report, funding of FinTech startups has increased at a compound annual growth rate (CAGR) of 41% over the last four years, with over US$40 billion in cumulative investment. Canada, however, is lagging behind on the FinTech space compared to the UK and many other countries. To take advantage of this opportunity for high quality jobs and pave the way for greater economic gains Canada must attract FinTech startups. Canada can take advantage of the transecting global digital transformation to put our economy on the right path to prosperity for our children and theirs's. Other countries are making faster progress than Canada on this front and we must demonstrate our own leadership or risk a downward spiral.The current government should be applauded for taking leadership on digital innovation in its 2017 federal budget. Many provinces are also taking strides. Though targeted investment and experimentation with policy to fuel innovation, such as the Super Cluster Initiative, will not produce return on investment if the business environment including policy and regulatory regimes  are not supporting the emergence of the very industries these dollars are trying to stimulate, much that involves technology driven positive disruption.There are many areas where we need to move, including on deployment of affordable next generation networks. One example with perhaps the closest link to the betterment of Canadian financial lives and developing a new wealth generating sector is open banking. Financial services have seen significant technical innovation in recent years, with rapid growth in new types of services in the market, which challenge our current framework.Open banking is when customers have the right to share their banking information from their financial institution with other financial service providers (so called FinTech companies). Technological developments have given rise to the emergence of a range of complementary services such as account information services and payment initiation services. Open Banking uses application program interfaces or APIs for consumers to share their financial data with regulated FinTech companies and new market entrants. This allows customers to have an overall view of their financial situation immediately at any given moment across all their banking relationships.At present, Canadian financial institutions do not allow their customers the choice to give access to their bank accounts to others. Contained in account agreements, restrictions prevent this choice and there are minimal technological solutions offered by financial institutions in Canada to facilitate this sharing of customer information.Buried deep in the 2018 Federal Budget, on page 355, is the announcement of a review of Open Banking.  It may sound immaterial, but, this simple action of allowing choice to share information opens the door to a more equal playing field for financial service providers allowing for greater efficiencies, choice, and transparency. It is the backbone of what has come to be known as “Fin Tech,” digitally driven innovation in the financial sector bringing new services in retail and investment banking as well as education and financial literacy.Open Banking is not a new concept. The EU recently adopted its second Payment Services Directive  (PSD2) which forces banks to open up their data to regulated new market entrants in the FinTech sphere. The UK went this direction long ago. Our own Competition Bureau noticed a couple of years ago that Canada is lagging behind its international peers when it comes to Fin Tech adoption and launched a market study. Market studies are one of the tools used by the Bureau to promote competition in the Canadian economy. They allow the Bureau to examine an industry through a “competition lens” to highlight issues that may restrict competition and inform public policy on the regulation of markets.”Key to the Bureau's recommendations was “Policymakers should embrace broader “open” access to systems and data through APIs. With better access to consumer data (obtained through informed consent), Fin Tech can help Canadians overcome their inability or unwillingness to shop around and switch between service providers.”While traditional financial institutions may cite cyber security, data protection and the need for regulation as a reason to keep on the brake pedal, this reasoning does not hold much water. Firstly, cyber security now transcends pretty much everything we do anyway and must be interwoven across socio-economic policy. Security must be at the centre of how we adopt artificial intelligence and next generation networks, including the capabilities they bring forward such as autonomous vehicles.Secondly, it suggests that data is somehow safer when centralized by a financial institution which is clearly not the case as per recent history with Equifax.As laid out in PSD2, forcing banks to open up data does not mean a free for all and companies will be regulated and need to accept liability and standards to protect data. PSD2 balances the need to enable existing and new service providers, regardless of the business model, to offer their services with a clear and harmonized regulatory framework. Protection of personal data is also cherished in PSD2. To have access to bank feeds, third party payment service providers should provide regulatory authorities with a transparent and detailed risk assessment that describes security controls and mitigation measures. National supervisory authorities will also need to apply regulatory technical standards such as customer authentication, and security measures. The European Commission's General Data Protection Regulation (GDPR), which comes into effect in May 2018, is also policy base for a proper use of innovative data driven financial services.Fear cannot direct our aspirations for a better way, to stay ahead we must embrace change.  Despite the incredible obstacles, had William Cornelius Van Horne said no to building the Pacific Railway, Canada would not be as we know it today.If the EU can align 28 countries and pave the road through PSD2 there's little argument to suggest one country cannot. There are too many instances of entrepreneurs moving to other jurisdictions due to an unwelcoming environment in Canada. Too often scalability means moving a company out of the country.To stop this economic drain and ensure access to innovative financial services, we do have to be expedient and the time is ripe for actionable alignment between stakeholders.  As such, ICTC is studying the possibilities of open banking for Canada and will be working with stakeholders and developing recommendations for the federal government's review.Jeremy Depow is Vice President of Policy and Research for the Information and Communications Technology Council (ICTC). Jeremy works to support ICTC's objectives of strengthening Canada's digital advantage in a global economy with the aim of enabling a competitive and inclusive digital economy, an innovative and entrepreneurial society, and a trusted and secure internet. Prior to joining ICTC, Jeremy served as Executive Director of Canada's Digital Policy Forum, a national think-tank, which he founded to intensify dialogue and collaboration on building digital policy in Ottawa.