The financial technology space is among the more competitive and rapidly evolving sectors.
In a world of digital transformation, the flow of capital is naturally an area where tremendous effort toward innovation would be placed.
As a result, Canadians have in recent years witnessed technology exert great impact on a financial industry that was largely unchanged for decades.
Here at Fintech.ca, covering Canada’s whirlwind of innovation in finance since 2021 has been exciting to say the least, and it seems that there is plenty more disruption and advancement to come.
Below, we recap what some popular Canadian fintech firms are working on this year.
Vancouver’s VoPay Goes Global
Earlier this year, Vancouver-based VoPay expanded to the US market.
The Canadian provider of embedded financial technology solutions leveraged a partnership with US fintech Cross River Bank to “dramatically increase” VoPay’s market reach south of the border.
Building on this, VoPay more recently set its crosshairs overseas, with global financial hub London marked for the bullseye.
“Our vision is clear: to establish VoPay as a dominant force in global financial technology,” stated founder Hamed Arbabi, who serves his company as chief executive.
Targeting the European market represents “a significant stride” in VoPay’s journey toward global expansion, according to a statement from the fintech.
London, a longstanding financial centre of Europe, will serve an initial foothold for “ambitious growth plans in the region.” The city already boasts more than 3,000 fintech firms.
“London’s vibrant fintech community and forward-thinking environment are exactly what we need to propel our expansion in Europe,” Arbabi believes.
VoPay’s jump across the pond is driven largely by the United Kingdom Fintech Canadian Technology Accelerators program, which is designed to help Canadian startups get exposed to the world’s top exporter of financial services.
“The CTA program is a vital step,” Arbabi says, “but it’s just the beginning of our European adventure.”
Other parts of VoPay’s adventure include a state-of-the-art Artificial Intelligence Lab and collaborations with other Canadian fintechs such as Parvis Invest.
Founded in 2015, VoPay continues to innovate its product offerings, as highlighted by the recent launch of an Instant Bank Account Verification solution.
Calgary’s Balance Safeguards Your Goods
In 2022, Canadian crypto custodian Balance celebrated its fifth anniversary with $500 million of assets under custody.
Founded in June 2017, the Toronto-born fintech—which recently moved its headquarters to Calgary—introduced its custody services in a closed pilot in August 2018. A public launch followed one year later.
“Our focus since day one has been to build a world-class custodian for companies working with digital assets,” George Bordianu, who serves as chief executive officer of Balance, has stated.
Recently, Balance announced that it has earned SOC 2 Type 2 compliance as a digital asset custodian, which marks a substantial effort from the company, according to Bordianu.
“It took us over two years to progress from a Type 1 to a Type 2,” the cofounder says. “In the end we’re happy we took the harder path and built our solution in-house instead of vending third-party providers.”
SOC 2 Type 2 certifications are widely recognized as the industry standard when it comes to evaluating vendor security.
“Our information security team designed and built a world class control environment to secure your assets,” the firm states online.
Some digital asset custodians which rely on third-party technology solutions. Balance said it had to undergo an “in-depth examination” of its own internal controls and proprietary offline and warm storage solution.
“We don’t have to caveat to every client that our service commitments are achieved only if the controls at our custody technology provider operate effectively,” says Bordianu. “We’re our own technology provider, so we know they operate effectively, as the Type 2 report demonstrates.”
Toronto’s Wealthsimple Aims High
The steadily growing financial technology firm, founded in Toronto in 2014, has been consistently expanding its offerings over the years—what started as a simple, limited financial app eventually evolved into a do-it-all “super app.”
But Wealthsimple doesn’t want to stop at Super App status. The fintech aspires to be Canada’s next major bank, a true rival to the nation’s Big Five incumbents—or perhaps something even better.
While many older Canadians still bank almost exclusively in-person at brick-and-mortar institutions, a majority of the nation’s younger investors are managing their financial assets using entirely digital processes supported by financial firms that often don’t even attempt to offer physical branches.
This includes Wealthsimple, which has brought out everything from venture capital and private credit offerings to private equity and even stock lending—all from your iPhone.
And in addition to breaking down barriers to institutional-grade investment opportunities, Wealthsimple also bolstered its cash account and added stock lending to its mix of offerings in 2023.
En route Wealthsimple’s stated growth target of $100 billion within five years, the fintech continues to pump out upgrades, enhancements, and enticements in 2024.
This month, for example, the company raised the insurance level of its famous Cash account (which offers up to 5% interest) to an impressive $500,000—up markedly from last year’s boost to $300,000.
Wealthsimple also added 14,000 symbols to its trading platform and extended its trading hours, among other additions, as the company continues toward its aim of being a fully featured financial institution.
This includes the social and gamification side of things, such as offering “Premium” and “Generation” tiers (based on total assets with Wealthsimple) that offer an interesting mix of tangible financial benefits and status-based perks.
Montreal’s Nuvei Seeks Privacy
After experiencing a high north of $170 per share back in 2021, Montreal’s Nuvei was never able to recover on the public markets, with shares dipping below $20 toward the end of last year.
Thus, following ample recent speculation, the Ryan Reynolds-backed Nuvei wentg private.
Private equity firm Advent International agreed to acquire the Canadian fintech in an all-cash deal valuing the firm at more than $6 billion.
“This transaction marks the beginning of an exciting new chapter for Nuvei,” stated Phillip Fayer, founder and CEO of Nuvei. “Bringing in a partner with such extensive experience in the payments sector will continue to support our development.”
Bo Huang, a Managing Director at Advent, believes that “Our deep expertise and experience in payments give us conviction in the opportunity to support Nuvei as it continues to scale from its base in Canada as a global player in the space.”
“Nuvei has created a differentiated global payments platform with an innovative product offering that serves attractive payments end markets like global eCommerce, B2B and embedded payments,” said Huang. “We look forward to collaborating closely with Nuvei to capitalize on emerging opportunities to help shape the future of the payments industry.”
Founded in 2003, Nuvei’s fintech platform spans 150 currencies and 680 alternative payment methods.
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