Field notes: March 2026

Who will pay for the NSF fee cap? Wealthsimple is not a "non-bank fintech." Fintrac does too little, too late. Detours in utopia, equality, bees dreaming, and the future of work.

Théodore Rousseau, “A Meadow Bordered by Trees,” 1845

In the news

Who will pay for the NSF fee cap?

• New NSF fee regulations bring down cost of banking for Canadians (Financial Consumer Agency of Canada)

• Canada’s latest move to slash banking fees could save account holders $600M (The Logic)

Tyler Dufault came out ahead, but new rules from Ottawa may set him back.

When Dufault was 45 cents short on a bill payment from his bank account, TD Bank levied $96 of overdraft charges on him. Dufault became the lead plaintiff in a class action against TD Bank, alleging that it had failed to disclose that it could charge multiple NSF fees for single transactions. TD Bank settled for almost $16 million in 2024, the same year Ottawa promised to cap NSF fees so that people like Dufault wouldn’t need to seek justice from the courts again.

This month, the new rules capping NSF fees to $10 came into force. And it’s the job of the Financial Consumer Agency of Canada, Canada’s financial consumer protection agency, to name and shame and fine the banks that break the rules.

Consumer groups are celebrating, having assumed the new rules will save Canadians nearly half a billion dollars per year, but they should be sceptical. They should treat the estimated benefits as if they were calculated on a napkin with simulated numbers.

To see why, start with the Department of Finance’s own analysis, which is sagely aware of its limitations: “Due to the lack of data on NSF fees in Canada, data from California was used to estimate the number of NSF fees charged in Canada.” So far, not so good. “The revenue loss to banks is assumed to be equivalent to the cost savings to consumers.” Okay. The government also assumed banks won’t raise other prices to recoup the losses, while acknowledging banks may recoup the losses by raising other prices. Napkin, meet bin.

It’s a non-trivial possibility that banks will try to recoup the losses in NSF fee revenue by raising other prices. A bank doesn’t set prices one by one, as if one part of the business doesn’t affect the other. It looks across its offerings and picks the prices that maximize profit from the bundle. This is why banks subsidize losses from some products with profits from others.

This isn’t just an “in theory” possibility: another of Ottawa’s recent obsessions has been prodding banks to offer more low-fee accounts, but what some Canadians are saving on account fees they are paying right back to their banks in transaction fees, according to research from Bank of Canada staff.

After tracking the banking habits of 47 Canadians over six months, researchers found that some low-income Canadians would save more money if they switched to a higher-fee account that didn’t charge them as much for withdrawals and payments. While the experiences of 47 Canadians aren’t generalizable, they challenge the ability of policymakers to simply will away the costs they don’t want Canadians to incur.

It’s not yet clear how the costs of Ottawa’s new NSF fee rules will be shared. But it seems wisest to assume the most profitable banks in the world, in good times and in bad, will find a way to share the costs with Canadians. The only silver lining for banks is that it’s harder for Canadians to feel what they can’t see.

Wealthsimple is more than a “non-bank fintech”

• Wealthsimple joins Swift global financial transfer system (Globe and Mail)

• Wealthsimple becomes first Canadian FinTech to join SWIFT network (Betakit)

• Wealthsimple becomes member of Swift payments system (The Canadian Press)

• Wealthsimple joins Swift global financial network (The Logic)

It wasn’t all backslaps and cheers when news broke that Wealthsimple is a member of Swift, the global payments network that coordinates the movement of money across borders. There were private grumbles, and one person aired their grievances in public, of all places on LinkedIn, the cesspool of toxic positivity and lowbrow humble bragging.

In question was the veracity of the claim from Wealthsimple’s PR team: was the company, in fact, the second “non-bank fintech” to “achieve membership”?

Depending on the standard of rigour, the answer seems to be either no or yes with a footnote. A surly LinkedIn avatar on the no side of this question said there are many non-bank fintechs that fall into one of Swift’s many user groups, such as Currency Cloud and Corpay and Thunes. The Logic’s Claire Brownell clarified that Wealthsimple’s claim is that, as far as the company knows, it is the second non-bank fintech to become a “SUPE” member, a Swift category limited to supervised financial institutions. That’s the retort for anyone on team yes with a footnote.

I think neither is quite right. For me, the question itself is like dividing a number by zero. An error message flashes across the screen.

The label “non-bank fintech” is so roomy that it’s informationally useless. Naively defined, it’s a non-bank company that uses technology to deliver financial services, like Sun Life Financial (insurance provider), or Visa (payment network), or Pine (mortgage lender), or Circle (stablecoin issuer), or Stripe (payment processor), or PayPal (digital wallet), or Hyosung (ATMs). The term also refers to companies like Wealthsimple, which is regulated as a securities dealer in Canada. Are all the securities dealers in Canada non-bank fintechs, too?

In my experience, trying to narrow the definition goes nowhere fast. Either it becomes arbitrary — like defining it so that it refers to any non-bank fintech founded on this side of the millennium, in the period a few researchers have called “fintech 3.0” — or it becomes so riddled with illogical exceptions that it starts to seem like a device to enforce the boundaries of cliques — Royal Bank of Canada’s brokerage arm isn’t a non-bank fintech because it sides with RBC, a member of the out-group.

If we’re going to ask the question at all, it’s better to ask whether Wealthsimple is the second ever securities dealer to become a SUPE member of Swift.

Perhaps it is. There is no public list of SUPE members of Swift I could find. All I could find is Swift’s eligibility criteria, which outline that SUPE membership is open to securities dealers. It reminds me of when Wealthsimple became a member of Payments Canada, which has long allowed securities dealers like Wealthsimple to join. Edward Jones, another securities dealer, became a Payments Canada member in 2009.

The even better question is this: how significant or interesting should we take it to be, when a company like Wealthsimple walks through a door that has long been open to it?

I think the answer to that question is very. By walking through the right doors, Wealthsimple now feels like a bank, no less than the biggest banks in Canada do, without being a bank itself. But it didn’t walk through those doors as a “non-bank fintech.” It walked through as a securities dealer and money services business. By shedding a useless label and picking up a set of useful ones, Wealthsimple is on its way to feeling like one of the biggest banks in Canada.

Fintrac does too little, too late

• Money-laundering watchdog revokes crypto firms’ registrations as Canada’s finance minister vows to maintain ‘momentum’ in its crackdown (Toronto Star)

• Regulators urge vigilance on financial crime risks from Iran as banks brace for headwinds (Globe and Mail)

This March, dozens of money services businesses — including more than 30 crypto companies — had their registrations to legally operate in Canada revoked. Fintrac’s moves followed news and commentary suggesting that Canada’s approach to policing financial crime is ineffective, and that the country’s cryptocurrency sector is a weak link in the chain.

As the U.S. and Israel wage war with Iran, whose access to the global financial system has been restricted, the risk of crypto-facilitated financial crime is growing. Here is Jessica Davis, PhD in the Globe and Mail:

For a long time, there almost wasn’t enough liquidity in the crypto market for it to be useful for sanctions evasion. But as Chinese professional money-laundering networks, other organized criminal entities, North Korea, Iran and even Russia have all created this illicit finance marketplace where they can trade amongst each other, cryptocurrency has become even more important and more useful for illicit actors.

The finance minister was probably right to describe Fintrac’s moves as “a significantly increased pace of action.” But not all significant increases are equally laudable. The increase from zero to 0.000000001 is infinite.

Revoking a few dozen registrations is too little, too late. Before Fintrac’s enforcement actions this month, a long investigation led by the International Consortium of Journalists turned up that many of the MSBs operating in the Greater Toronto Area weren’t legally operating.

Fintrac seems to struggle to enforce its own rules, and it’s not known for being effective at the only other job it has, either. A commission out of British Columbia concluded a few years ago that law enforcement can’t rely on Fintrac to “produce timely, actionable intelligence with respect to money laundering threats.”

It’s hard for me to reconcile all of this with Canada’s reputation for having high state capacity. According to the 2025 Chandler Good Governance Index, Canada’s greatest advantage is the strength of its public institutions, which includes the quality of its bureaucracy, and the ability of its institutions to coordinate and implement. Why, then, is the country so bad at putting a lid on financial crime, earning nicknames like the snow-washing capital of the world?

Perhaps financial crime is just one of the exceptions where Canada’s public institutions haven’t been good enough.

Either way, the government seems to know. The financial crimes agency the Liberals announced five years ago should boost capacity to enforce the law. Legislation to stand the new agency up is expected this year. But the intelligence of enforcement will depend on a timely and ample supply of financial intelligence. So how will Fintrac do better? A bill is making its way through Parliament to give Fintrac the power to levy bigger fines on lawbreakers and share more intel with law enforcement. Whether empowering Fintrac will allow it to do better is one question. Whether it will do better is another. I don’t think history’s answer to the latter question is flattering.

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Detours

Utopia needs a little dystopia

• The outliers (In Due Course)

Fusing philosophy and observations of the United States and China, Joseph Heath argues that progress requires variance: “Kant’s provocative suggestion was that, in order to ensure human progress, what we need is not a stable compromise between the pro-social and anti-social impulses of human nature, but an ongoing, dynamic tension between them.”

Equality is necessary in a secular world

• Equality as a consolation prize (Ruxandra’s Substack)

Ruxandra Teslo called equality a “pathetic consolation prize” in the shift from a religious society to a secular one. In a religious society, there is more to the cosmos than what happens between life and death. There is hope that reward will still come after having lived a good life, no matter how deprived of material abundance and status that life was. In a secular society, however, there is no such hope. There is only here and now. Losers die as losers, and winners as winners, unless the pursuit of equality can balance the scales before it’s too late.

What do bees dream about?

• The dreams of a bumblebee in autumn (Nautilus)

“For them the asters are a last source of pollen and nectar. The bees who consume them have only a few days left, but at least their stomachs will be full. And when I walk along my driveway on late autumn evenings, I see bumblebees lying atop the asters, sometimes two to a blossom, the petals embracing them as sunlight fades. At night they will sleep there, and some will die when the temperature falls—but at least they will do so on a bed of pollen, their senses and perhaps even their dreams suffused with its smell and taste.”

The future of work

• Vignettes from the takeoff (Strange Loop Canon)

Rohit Krishnan wrote an excerpt of a memoir from the future. He imagines what the future of work is like, how AI has lowered transaction costs, and how relative scarcities have changed. “We all had something installed that could read and analyse everything that was done on the machine, to help us do the job better,” he wrote. “But pretty soon, at the end of it, the AI just learnt from what I’d done, every part of it, and be able to just do it from then on.”