Canada’s new open banking legislation could help women experiencing economic abuse

Economic abuse is widespread

Economic abuse is a hidden and harmful form of gender-based violence that happens when someone uses money or other resources to control, exploit or harm another person.

Common abuse tactics include restricting access to household income and benefits, withholding financial information, monitoring every purchase, excluding a partner from critical financial decisions, building up debt in their name and preventing them from accessing banking or credit on their own.

Statistics Canada and federal data show that financial abuse disproportionately affects women. The Canadian Centre for Women’s Empowerment estimates that economic abuse affects one in three women who are victims of intimate partner violence nationwide.

In a study of victims of gender violence in the Ottawa region, 93 per cent of respondents reported not having access to their own money. Eighty-six per cent said they had been ordered to quit work by an abusive partner, leading to further isolation and financial dependence.

Economic abuse also extends beyond households into family-owned and co-owned businesses, which make up over 60 per cent of Canadian businesses.

It is common for one partner to “handle the books” and be the only person with access to business banking, merchant accounts, payroll systems and tax portals. The other partner may be a legal director of the corporation but have no access to the company’s financial information.

Helping women experiencing economic abuse
Open banking is fundamentally about consumer control and protections around sharing financial data. Under an open banking framework, banks are no longer the sole gatekeepers of financial information.

This means a person who can prove their identity can authorize a regulated third party — such as an accredited app, accountant or a lawyer — to retrieve the data they are legally entitled to. They wouldn’t have to rely on another account holder or log in on a shared device in an unsafe environment.

Link to full story here.