Thank you, Mr. Chair.
Thanks to the committee for this invitation.
My name is Jessica Oliver. I'm head of government and regulatory affairs at Wealthsimple, a financial services company trusted by over three million Canadians, including one in five adults under 40. I'm privileged to work with over 1,000 colleagues across the country.
Our mission is to help Canadians reach their financial goals. We started 10 years ago with a single product and a straightforward regulatory framework. We offered low-cost managed investing, which means clients describe their financial circumstances and goals, and our team manages their investments to achieve those goals.
Over time, we've added other products, including commission-free self-directed investment. We offer fee-optional tax filing that this year was used to “netfile” more than 1.7 million returns, the majority for free. We offer Canada's highest-interest chequing account with no monthly fees or minimum balances. In the last year, our clients have earned more than $100 million in interest in these accounts.
We saw incredible uptake when we launched the first home savings account. From August to December, more than 200,000 Canadians started saving for home ownership with a Wealthsimple FHSA, which is, to our knowledge, more than 30% of all FHSAs. Our total accounts are now over 250,000.
I'm pleased to join you as you consider the budget implementation act. I'd like to touch on the bill's action on consumer-driven banking, financial fees and the Canada learning bond.
The bill lays the legislative foundation for consumer-driven banking, also known as open banking, which will provide a secure and simple way for Canadians to share their financial data between providers, making it easier for them to access and integrate the financial products that suit them best. Here's what that really means. Consumer-driven banking can help a homeowner lower their mortgage rate by proving they have a pension. It can help renters build their credit score by proving they pay on time. It can help newcomers build credit by incorporating financial data from their countries of origin. In fact, the Financial Services Regulatory Authority of Ontario, FSRA, has identified consumer-driven banking as the biggest potential driver of innovation in mortgage brokering. According to StatsCan, Canadian households pay $694 per year for financial services. We believe they deserve lower costs, more convenience, less friction and ultimately more control over their own money.
Consumer-driven banking is one piece of a broader fundamental need to enable competition on a level playing field. Our financial infrastructure lags behind that of all of our G7 peers, and it has for decades. Wealthsimple has been a part of the consultation process and will continue to work with Finance Canada and the FCAC to inform the implementation of open banking and make sure our business is ready for our clients to benefit.
It's also important to acknowledge that open banking is not a silver bullet for the competition problem in Canadian financial services. Financial regulators, both federal and provincial, should be explicitly mandated to deliver competition in their respective industries, just as their counterparts in the U.S., U.K. and Australia are. Financial regulators point to the Competition Bureau, which for all of its good work, does not have the resources or the mandate to take on this role alone. Its advisory recommendations to financial sector regulators are only suggestions and are typically ignored.
With respect to fees, regulators should also take a closer look at where Canadians are being charged fees for financial services without a reasonable connection to the actual cost of the service. Right now, Canadians who move an investment account like a TFSA from one financial institution to another pay up to $250 for the privilege of moving their own money. The actual cost of that transfer, if processed through widely available automated systems, is less than a dollar. There is no justification for that, and it is a transparent attempt to prevent Canadians from making a free choice of their financial provider. The federal budget has committed to working with provinces to tackle junk fees in a range of areas, and in our view, this should be near the top of the list.
Finally, in addition to our products, we established the Wealthsimple Foundation, which increases awareness of and participation in RESPs and the Canada learning bond. We were pleased to see a commitment for the auto-enrolment of eligible children in the Canada learning bond. It's the right thing to do. It means the Wealthsimple Foundation will be in need of a new mission and mandate, and we're thrilled about that opportunity.
To conclude, the measures for consumer-driven banking are welcome, but they are a start, not the end. There is much more to do to create a truly competitive financial services sector, starting from the first principles of how it's regulated and what we want it to deliver for Canadians.
Thank you.