Weak competition in Canadian retail banking is costing Canadians $8.5 billion in extra fees each year

Regulators and firms within the Canadian banking sector maintain a stable and secure financial system, which provides enormous benefit to the Canadian economy. However, regulators and the major retail banks (the ‘Big 5’) are failing to provide Canadians with competitive retail banking services. This is costing Canadians hundreds of dollars extra per year for inferior services and slow innovation.

Comparing the Canadian retail banking market to the markets in the UK and Australia shows that Canadians incur higher fees and are provided inferior services with slow innovation. Several Canadian market outcomes demonstrate instances of market coordination between Canada’s major retail banks. 

In our latest report, we propose regulatory changes to improve competition in retail banking. We find that current Canadian regulatory budgets are inadequate for sufficient competition oversight and that increasing regulatory expenditure will generate significantly more in savings for Canadian consumers.