Canadians about to be won over by Fintech?

  • 31 Jan

What sort of relationship do Canadians have with FinTech? What obstacles will startups working in this field have to overcome in order to win them over? A recent survey provides some of the answers.

Canadians currently appear not to have much appetite for financial technology, according to the FinTech Adoption Index 2017 compiled by Ernst & Young. Just 18% of all Canadians surveyed have adopted these tools, compared with an average of 33% in the United States and 27% in France. To find out more about the apparent lack of enthusiasm in the Maple Leaf country, the financial products comparison site conducted an online poll on the subject among a sample of 1,000 Canadians late last year.

What emerged from the survey was a clear generational divide: millennials (18-34 years of age) are more inclined to use this kind of technology to manage their finances than the over-55-year-old baby-boomers. Millennial respondents were more comfortable with digital payments methods, and while 44% of them reported they were prepared to trust robot financial advisors, only 23% of the baby-boomers said the same thing. However, young and old share the same doubts when it comes to protecting their personal data, especially as regards data security. On the other hand, 85% of them trust their banking apps, an attitude which reckons is basically due to habit.

Whether or not this is correct, financial technology is nevertheless gaining ground in Canada. The ecosystem is already growing fast, with venture capital flowing in, and a number of startups are already making headlines. WealthSimple, a financial robot advisor, is also operating in the United States. Meanwhile the app developed by Quebec-based Mylo is designed to boost people’s savings by rounding up to the nearest whole figure the price of every purchase made by users and automatically transferring the difference to a savings vehicle. The FinTech firm has just raised 2.5 million Canadian dollars in capital – the equivalent of about 2 million US dollars. Meanwhile Montreal is gradually carving out a patch for itself in the sector alongside big sisters Toronto and Vancouver. With a population of just under 37 million, Canada is quite a small market... but one with considerable potential.

By Sophia Qadiri