Fintechs Canada has submitted its response to the federal government’s consultation on enhancing trust in artificial intelligence through increased transparency.
Fintech companies are using AI to strengthen Canada’s financial system through real-time monitoring, fraud detection, identity verification, cybersecurity protections, and more personalized financial services. Effective AI policy must protect consumers while enabling companies to continue developing and deploying these tools responsibly.
Fintechs Canada’s submission identifies five principles that should guide the government’s approach:
- Avoid Regulatory Duplication and Unnecessary Red Tape
The financial sector is already subject to extensive oversight under legislation governing payments, anti-money laundering, privacy, and consumer protection. New AI transparency and incident-reporting requirements should complement these frameworks rather than duplicate or conflict with existing obligations. Canada should also draw on established international standards to support interoperability and prevent its market from becoming isolated.
- Ensure Proportionality Based on Business Size and Risk
Transparency requirements should reflect the risks associated with a particular AI application, as well as the size and risk profile of the business deploying it. A customer-facing AI tool providing financial guidance should not be treated in the same way as a back-end fraud-detection system. Requirements should focus on high-impact consumer interactions while minimizing unnecessary burdens on lower-risk operational and security applications.
- Align rules with Canada’s ongoing Pro-Competition Efforts
Overly burdensome requirements can create barriers for emerging and scaling companies. AI transparency obligations should be outcome-based rather than prescriptive, giving businesses the flexibility to meet policy objectives in ways that reflect their operations and protect proprietary intellectual property.
- Meaningful Industry Engagement and Fintech Representation in AI Governance Structures
AI technology is evolving quickly, and rigid rules risk becoming outdated before they are fully implemented. The government should engage continuously with the fintech sector to understand implementation challenges, anticipate unintended consequences, and ensure that fintech expertise is represented in AI advisory and governance structures.
- Consumer Protection Without Unnecessary Burden
AI policy should advance consumer protection while recognizing the strong governance and compliance practices already in place across the financial sector. Fintechs Canada is also encouraging the government to support verifiable, privacy-preserving digital identity credentials and establish clear timelines for their adoption. These tools can help Canadians identify trustworthy products and protect themselves against AI-enabled deepfakes, impersonation, and fraud.
By adopting targeted, proportionate, and non-duplicative rules, Canada can build public trust in artificial intelligence while allowing fintech companies to continue innovating, protecting consumers, and competing globally.
The full submission is available here.
