Bytes Better Have My Money

Bytes Better Have My Money

As we conduct more of our financial transactions digitally, we provide a wealth of digital data about our spending habits, debts, credit scores, and income.
​Sarah Villeneuve
Policy Analyst
Stephanie Fielding
Policy & Research Analyst
January 14, 2020
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More and more we are managing and conducting our financial transactions digitally, including online banking, overseeing our spending, budgeting, and managing our debt. These actions create a wealth of digital data about our spending habits, debts, credit scores, and income.

Digital and Mobile Banking

In a 2019 study, 76 per cent of Canadians surveyed reported that they use digital channels, both online and mobile, to conduct the majority of their financial transactions.[1] Of those, 88 per cent of Canadians reported they have used online banking within the last year, with 53 per cent citing it as their most common method of banking. However, the survey results also indicated that mobile banking is on the rise in Canada, particularly among Millennials, with 36 per cent reporting mobile banking as their primary mode of banking, compared to 23 per cent for all other demographic groups.[2] 

When an individual uses online or mobile banking, their financial institution collects a variety of data, including personal information such as name, email address, age, gender, occupation, and income range, as well as information about the web browser and device being used to access these services.[3] [4] Most, if not all, banks use third-party cookies and other activity trackers to understand how users engage with site features, as well as whether they click on ads related to their services on other websites. This information is used to better understand what services and features to offer to individuals. Banks can also see information related to purchases (such as item and name of seller), payments (such as hotel reservations), transfers, and debts associated with the credit and debit cards attached to an individual’s account.[5] 

After receiving complaints from Canadian residents, the Office of the Privacy Commissioner of Canada launched an investigation into Statistics Canada in 2018. To support their record of Canadian financials, the national agency had been harvesting personal transaction information without the consent of 500,000 households across the country.[6] Records were obtained by StatsCan from the TransUnion of Canada credit bureau, including fifteen years of personally-identifying information (e.g., social insurance numbers, names, addresses, dates of birth) and credit information (i.e., balance owed and overdue, et al).[7] StatsCan has expressed plans to request information from nine other large financial institutions, which could enable the collection of even more granular financial data (including ATM withdrawals, transaction history, and loan payments).[8] Canadian law does not require StatsCan to inform individuals of such data requests; however, the privacy commissioner has urged changes to be made to increase individuals’ privacy rights when it comes to government agency access to increasingly detailed personal information.[9] 

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"This software largely eliminates the need for human financial advisors, even though customers still have access to a human advisor when they would like to speak to one."

Robo-Advisors

Since 2014, many Canadian financial institutions have employed robo-advisors — financial advisory software that “provides algorithm-based investment management services, including automated portfolio planning, automatic asset allocation, online risk assessments, account rebalancing and numerous other digital tools”.[10] Robo-advisors provide personalized customer service by collecting financial information from clients such as income, credit score, and expenses, as well as personally-identifiable information related to family, risk tolerance, and future goals. This software largely eliminates the need for human financial advisors, even though customers still have access to a human advisor when they would like to speak to one. Robo-advisors also provide clients with direct access to their full portfolios via an online platform.[11] Many robo-advisors offer reduced fees in order to reach populations such as Millenials and low-income households.

One of the most popular robo-advisors in Canada today is Wealthsimple, an online investment management platform that uses intelligent technology to build clients’ investment portfolios and autonomously manage investments. Clients are required to provide personally-identifiable information such as name, address, phone number, email address, birth date, social insurance number, asset holdings and values, chequing account information (including account balances and limits), transactional history, as well as a spouse’s or designated beneficiary’s name and date of birth.[12] This personal information is collected in order to verify the client’s identity, prevent fraud, and meet legal requirements. Wealthsimple’s website states that they believe understanding a client’s goals, financial position, and family issues enables them to ensure they are providing suitable investment options.[13] For this reason, clients are required to complete a questionnaire about risk tolerance and goals to help determine the appropriate level of risk for their portfolio. According to Wealthsimple’s Privacy Policy, personal information may be transferred to third parties that provide identity verification, administration, technology, printing, marketing, data analysis, hosting, legal, and accounting services.[14] Wealthsimple provides clients the ability to access their personal information, as well as correct any inaccuracies that may be present.[15]

Wealthsimple uses cookies and other tracking technologies such as web beacons, and website analytics to better understand what pages a client visits most, improve user experience, and personalize content in relation to the user’s interests. There is also the option for clients to engage with Wealthsimple content through their social media sites, through plug-ins or applications. This will require users to grant access to information associated with their social media account, such as their name, user name, gender, email address, and profile picture. Information collected through social media sites can then be used to personalize the user’s experience and provide them with suggestions for products and services they may like.

"Many credit score apps also provide insights into users’ spending habits by summarizing monthly debt, automatically categorizing expenses (e.g., food, entertainment, and housing), and providing tips on how to increase their credit rating."

Credit Score Apps

A number of applications have been developed in recent years to help individuals stay on top of their credit score. These applications often require individuals to provide personal financial information, such as their financial institution, credit card number, and social security number. Many credit score apps also provide insights into users’ spending habits by summarizing monthly debt, automatically categorizing expenses (e.g., food, entertainment, and housing), and providing tips on how to increase their credit rating.

Credit Karma is a free online credit score application that allows users free, unlimited access to their credit scores and reports from TransUnion and Equifax. As of January 2019, Credit Karma has over 85 million users. To register, individuals need to provide their name, email address, phone number, and Social Insurance Number (SIN). Unlike many other credit score applications, Credit Karma does not require users to register a credit card, and instead relies on an individual’s Social Insurance Number to access their credit information. According to Credit Karma’s privacy policy, the company does not share users’ credit reports or scores with third parties, and does not sell personal information to third parties for advertising.[16] Credit Karma may, however, use tracking technologies such as cookies or web beacons to collect behavioural information on users and how they use the app.[17] Credit Karma uses users’ credit history and behavioural data to suggest credit products and services, such as loans, credit cards, or insurance.[18] If users make purchases from any of the suggested providers, Credit Karma receives a referral fee.[19]

Financial Tracking Applications

Some applications track more than just an individual’s credit score, instead providing them with a detailed overview of their spending habits, financial goals, budget, and investments. Many of these applications are now widely available for free, and can be downloaded on smartphones and tablets or accessed through a web browser. While these applications are growing in popularity and use, some critics have expressed concern regarding the safety and privacy of sensitive customer data, such as log-in details and spending habits.

Mint is a popular financial tracking application that helps users monitor their spending and stick to a budget. To register, individuals need to provide their online banking log-in details (username and password) in order to allow Mint to sync with their bank accounts and track deposits and expenses.[20] Users have the option to use Mint’s bill payment tracker, which requires individuals to enter details about the bills they have, such as the date and amount due, and then set reminders or give Mint permission to automatically pay the bill if funds allow.

While Mint’s privacy policy states that it does not sell any personally-identifiable information—information that could be traced back to one person—Mint reportedly sells aggregated data from its users to other financial institutions.[21] Mint also makes referrals to financial services and products based on users’ spending habits and credit score. If users sign up to use a service or product advertised, Mint gets paid a referral fee.[22] 

This is part of a series of articles exploring personal data collection practices in Canada. Check out our previous article on Shopping, and stay tuned for our next article on Public Spaces + Services.

Technology and policy related to this topic are constantly evolving. If you think we have missed something or see an error please contact Sarah Villeneuve (sarah.villeneuve@ryerson.ca). If you want to get involved in subsequent phases of this project, apply here.


[1] Canadian Bankers Association. 2019. “Focus: How Canadians Bank.” Canadian Bankers Association. March 13, 2019. https://cba.ca/technology-and-banking.

[2] Canadian Bankers Association. 2019. “Focus: How Canadians Bank.” Canadian Bankers Association. March 13, 2019. https://cba.ca/technology-and-banking.

[3] “CIBC Digital Privacy Statement | Legal | CIBC.” Accessed October 18, 2019. https://www.cibc.com/en/privacy-security/online-privacy-statement.html.

[4] “TD Bank Privacy & Personal Information Policy.” Accessed October 18, 2019. https://www.td.com/us/en/personal-banking/privacy/.

[5] Canada, Office of the Privacy Commissioner of. “Electronic and Digital Payments and Privacy,” September 1, 2016. https://www.priv.gc.ca/en/privacy-topics/technology/mobile-and-digital-devices/02_05_d_68_dp/.

[6] Zimonjic, Peter. “Privacy Commissioner Launches Probe into StatsCan over Collection of Financial Data | CBC News.” CBC, October 31, 2018. https://www.cbc.ca/news/politics/personal-financial-information-statistics-canada-1.4885945.

[7] Akin, David, and Andrew Russell. “StatCan Scooped up 15 Years of Personal Financial Data from Canadian Credit Bureau -.” Global News, October 30, 2018. https://globalnews.ca/news/4610259/statcan-canadian-personal-credit-bureau-data/.

[8] Akin, David, and Andrew Russell. “StatCan Scooped up 15 Years of Personal Financial Data from Canadian Credit Bureau -.” Global News, October 30, 2018. https://globalnews.ca/news/4610259/statcan-canadian-personal-credit-bureau-data/.

[9]  Akin, David, and Andrew Russell. “StatCan Scooped up 15 Years of Personal Financial Data from Canadian Credit Bureau -.” Global News, October 30, 2018. https://globalnews.ca/news/4610259/statcan-canadian-personal-credit-bureau-data/.

[12] “Privacy Policy | Wealthsimple.” Accessed October 18, 2019. https://www.wealthsimple.com/en-ca/legal/privacy.

[13] “Privacy Policy | Wealthsimple.” Accessed October 18, 2019. https://www.wealthsimple.com/en-ca/legal/privacy.

[14] “Privacy Policy | Wealthsimple.” Accessed October 18, 2019. https://www.wealthsimple.com/en-ca/legal/privacy.

[15] “Privacy Policy | Wealthsimple.” Accessed October 18, 2019. https://www.wealthsimple.com/en-ca/legal/privacy.

[16] “Credit Karma.” Accessed October 18, 2019. https://creditkarma.ca.

[17] “Credit Karma.” Accessed October 18, 2019. https://creditkarma.ca.

[18] Staff, Investopedia. “Why Credit Karma Is Free and How It Makes Money.” Investopedia. Accessed October 18, 2019. https://www.investopedia.com/articles/personal-finance/010815/why-credit-karma-free-how-it-makes-money.asp.

[19] Staff, Investopedia. “Why Credit Karma Is Free and How It Makes Money.” Investopedia. Accessed October 18, 2019. https://www.investopedia.com/articles/personal-finance/010815/why-credit-karma-free-how-it-makes-money.asp.

[20] Schultz, Jennifer Saranow. “Should You Trust Mint.Com?” Bucks Blog (blog), July 6, 2010. https://bucks.blogs.nytimes.com/2010/07/06/should-you-trust-mint-com/.

[21] Smart Money Nation. “How Safe Is Mint.Com?,” January 9, 2018. https://smartmoneynation.com/mint-security/.

[22] Smart Money Nation. “How Safe Is Mint.Com?,” January 9, 2018. https://smartmoneynation.com/mint-security/.

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