A Canadian crypto CEO says Canadian banks are “gatekeeping” FinTechs to ensure banks remain the most profitable institutions in the world.
Newton CEO Dustin Walper said just one FinTech company was able to join Payments Canada and gain access to Interac.
“Big Canadian banks control the flow of practically all payments in the Canadian economy,” he wrote online.
“(Banks) are gatekeepers, and this makes them insanely profitable – the most profitable financial institutions in the world, in fact. They work very hard to shut everyone else out.”
FinTech, or “financial technology,” refers to firms using new technology to compete with traditional financial methods to deliver financial services.
Walper said that allowing FinTechs like Newton or Koho access to payment rails would threaten the gatekeeping status banks currently have and reduce the cost of payments across the Canadian economy, “thus harming the profitability of Canada’s banks.”
He said banks make stability arguments — even while Interac had a major outage earlier this year. That outage demonstrates the “danger” of such powerful monopolies regarding critical infrastructure, he said.
“Big banks don’t spend millions of dollars lobbying government to promote ‘stability’, they do it to protect and promote their own financial interests,” he said. “This is rational and obvious.”
“Canada needs to open up its payment system to REAL competition, and it needs to do it soon. Companies like Newton are ready and able to help – just let us participate.”
In a statement to The Counter Signal, Walper said the high cost of payments in Canada is a hidden tax levied on Canadians already struggling with skyrocketing inflation.
“We call on Payments Canada to break the bank monopoly on payments and lower the cost of doing business in Canada by opening membership to FinTech companies like Newton.”
In April, the government of Alberta introduced a bill to create a “safe space” for up-and-coming tech companies in the province looking to develop cryptocurrency and blockchain technology.
According to a news release, “If passed, Bill 13 will establish a regulatory sandbox for financial services and fintech companies.
