Impact of Open Banking on Canadian Financial Transaction Platforms

Open banking systems have slowly migrated throughout the world, they are already implemented in Australia and Great Britain. An open banking system allows financial institutions to communicate directly with one another without the need of a central payment processing or clearance platform. As Canada turns to open banking in the future, payment processing platforms’ product mix will change. Working with a large payment processing platform in Canada, we determine the impact of open banking on the platform and determine what product fees may be charged, given regulatory and market conditions, such that the platform remains viable, as defined by the platform’s key performance indicators. We use optimization and simulation methods as defined in the literature to find a range of fees.

Faculty Supervisor:

Stanko Dimitrov

Student:

Partner:

Interac Corp (Kitchener, ON)

Discipline:

Mathematics

Sector:

Finance and Insurance

University:

University of Waterloo

Program: