What open banking means for Canadian practices and their clients

As I head out on the road for Xero’s Canada Roadshows this October—also Small Business Month—I’ll be returning to a conversation I first had at Xerocon with Jules Hawkins, Co-Founder of Hawkins & Co., and Sarah Bartnicka, Editor of Milk Bag: what open banking will mean for Canadian practices and their clients.

The question I keep coming back to is how quickly small businesses will benefit from this change. The answer will depend not only on the legislation and technology, but on whether accountants and bookkeepers are ready to explain open banking, answer questions and help clients see what more reliable financial data could make possible.

That matters because most small business owners still have no idea what open banking means. In Xero research conducted with Angus Reid in August, 82% of 508 small business owners said they had not heard of the Consumer-Driven Banking Act. Nearly half of surveyed owners trust their accountant or bookkeeper most to help manage access to their financial data. That puts practices in a strong position: clients will want someone they trust to explain the change and help them make informed choices.

The Act and where it stands

The Act gives business owners control over their banking data and a regulated way to share it with chosen people and tools. Today, access often depends on connections software providers build with individual banks, and some owners still share online banking logins to make it work.

Under the new framework, banks will share data with an owner’s permission through secure connections, without a password. The rollout will happen in two phases: read access first, followed later by write access and payments.

The Act received Royal Assent in March, and draft regulations were published in June. Read access is expected to start sometime between late 2026 and 2027, although the timing could change. Prepare for the direction of travel rather than a specific date.

Why practices should care

Canada is following markets such as the UK and Australia, where similar rules helped accelerate cloud adoption. In the UK, cloud accounting subscriptions grew from about 0.9 million in FY18 to 2.4 million in FY22—roughly a 2.5x increase. Open banking was a critical enabler of that growth, alongside Making Tax Digital and COVID, as reliable bank data helped demonstrate the value of cloud. Once reliable bank data became available, small businesses asked their advisors what it meant for them, and cloud-ready practices were best placed to answer.

Open banking should reduce routine work caused by unreliable feeds, including reconnecting accounts, tracking missing transactions and re-entering statements. Practices can use that capacity to take on more clients or focus on higher-value services.

With more current data, practices can offer monthly cash flow reviews, forecasting and mid-month check-ins instead of waiting weeks for statements. For practices building an advisory offering, reliable data removes two major barriers: time and visibility.

Business owners will also need help deciding which apps and services should access their bank data. Guidance on security and data access can become part of onboarding, build trust and give clients another reason to stay.

Why clients need to hear it from you

Owners who knew about the Act were about twice as likely to say they would use open banking in its first year. Often, the difference was that someone had explained it to them.

If you do not start the conversation, a bank or software vendor may do it first. Explaining the change is a natural extension of the relationship and can help clients move away from risky practices such as sharing a banking password.

How to start the conversation

You do not need a major campaign. Start with a short explanation for newsletters, onboarding emails or client meetings. Be ready for questions about privacy, security and accountability, and clear about what is confirmed.

Prioritise clients who share banking passwords or manage significant manual data. Bring the topic into year-end and onboarding conversations, because most owners need repeated reminders.

Getting your practice ready

If your practice still relies on desktop software or spreadsheets, moving to the cloud is the first step. Identify tasks caused by unreliable feeds, then decide where that time could create more value. Cash flow reviews and forecasting are practical places to start.

Canada has taken years to reach this point, and there is still work ahead. How quickly small businesses benefit will depend in part on whether their bookkeepers and accountants are ready to explain the change. Start the conversation now, and your practice will be better prepared when open banking arrives.