Competition Bureau provides recommendations to strengthen competition in Canada’s financial sector

Summary:

The Competition Bureau, a Canadian law enforcement agency, has submitted its response to the Department of Finance Canada's public consultation on strengthening competition in the financial sector. The submission highlights the importance of competition in the Canadian economy, particularly in the financial sector, where borrowing costs have increased significantly. The Bureau recommends two measures to lower switching costs for consumers and promote competition: 1) adopting a consumer-driven banking framework to challenge established providers and enable new entrants, and 2) reconsidering the application of the stress test for uninsured mortgage borrowers to allow them to switch lenders. The submission also urges policymakers to prioritize competition in the financial sector and welcomes the government's commitment to deliver consumer-driven banking by 2025.