Canadian small businesses unaware of open banking law

Xero Canada has published survey findings showing low awareness of Canada's new open banking law among small business owners. The research also found that many still share online banking credentials to manage accounting tasks.

The survey, conducted by Angus Reid Group for Xero, found that 82% of Canadian small business owners had not heard of the Consumer-Driven Banking Act. It also found that 61% had never heard of open banking before taking part.

The figures point to a knowledge gap as Canada moves toward an open banking framework that will change how financial data is shared. Just 4% of respondents said they knew the Act existed and understood what it meant for their business.

The research also highlighted how some businesses currently manage data sharing. It found that 18% of owners currently share their online banking username and password with an accountant, bookkeeper, employee, or software tool, while 22% said they had done so at some point.

This practice sits alongside a clear preference for professional advisers when owners consider who should manage access to financial data. Nearly half, or 49%, said they would trust their accountant or bookkeeper most, compared with 20% who chose their bank and fewer than 1% who chose a fintech company.

Administrative focus

The findings suggest small businesses are focused less on technical change than on routine financial administration. Asked about the main benefits they would want from open banking, 39% chose easier accounting and bookkeeping, 28% chose less time spent on financial administration, and 27% chose lower banking costs.

Interest in using open banking services appears modest overall but stronger among better-informed owners. The survey found that 28% were likely to use such services in the first 12 months after they became available, rising to about half among those who already knew about the Act.

Xero said the findings show accountants and bookkeepers will play a central role in explaining the changes to clients. That view reflects the higher level of trust respondents placed in advisers than in banks or fintech groups.

Ashalee Mohamed commented on the survey results.

"Open banking is arriving in Canada and the majority of small business owners don't know it's coming. This is a real gap to close, because a framework only delivers if the businesses it was built for are ready to use it," said Ashalee Mohamed, Country Manager, Xero Canada.

"What's striking, but not surprising, is that businesses already trust their accountants and bookkeepers with this more than their own banks. That's exactly why advisors are best placed to close the awareness gap: owners who already knew about the Act are around twice as likely to say they will use these services in year one. My advice to practices is simple - now is a great time to get ahead of the change and move to the cloud if you're not already there," said Mohamed.

Trust and adoption

The trust findings may matter for accounting firms and bookkeepers serving smaller companies. If open banking adoption depends partly on confidence in those handling financial data, advisers could become a key channel for both education and implementation.

For software providers, the results also underline a challenge in communicating financial technology changes to smaller businesses. Fewer than 1% of respondents said they would trust a fintech company most to manage access to their data, suggesting brand familiarity and existing advisory relationships may matter more than newer digital entrants.

The research covered 508 adult Canadian small business owners from the Angus Reid Forum and was carried out in English and French. The sample was described as representative of online small business owners in Canada.

The combination of low awareness and continued password sharing suggests many owners still rely on informal or outdated methods to move financial information between banks, accounting professionals, and software tools. At the same time, the survey indicates that practical benefits such as simpler bookkeeping and less administrative work are more likely to shape adoption than abstract debate about financial regulation.