Canada Fintech Challengers Market Report 2022
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Description
“The challenge for Fintech upstarts is to convert the greater attitudinal openness of younger consumers to digital banks into meaningful market share. This will be a long journey as the big banks in Canada are well entrenched, so the best bet for Fintech challengers is to target niche markets while working on their brand image and increasing awareness levels.”
– Sanjay Sharma, Senior Financial Services Analyst
This Report discusses the following key topics:
- Consumer usage of and attitudes towards specific financial technologies, Fintech innovations, interest in mobile banking features, openness to the use of Fintech and Fintech challengers.
- In the context of this Report, teens refer to 13-17 year olds.
Table of Contents
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Overview
- What you need to know
- Key issues covered in this Report
- What you need to know
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Executive Summary
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- Top takeaways
- Market overview
- Outlook on Fintech challengers
- Figure 1: Outlook for Fintech challengers, 2022
- Opportunities
- Cryptos and NFTs can set challengers apart from traditional banks
- Awareness and interest in open banking is increasing
- Younger consumers are more open to Fintech but trust issues remain
- Challenges
- Usage of newer entrants is low
- Non-users don’t see any good reason to use mobile banking
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Market Factors
- Immigrants are a major growth market for banks
- Figure 2: Distribution of foreign-born population by region of birth, 1996-2036 (projected)
- Inflation will make consumers more fee-sensitive
- Figure 3: Simplii Financial Facebook ad, 2022
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- Figure 4: Changes in Consumer Price Index, 2019-22
- Teens are a promising market for Fintech challengers
- Figure 5: Financial product ownership of 13-17 year olds, 2022
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- Figure 6: Financial activities of 13-17 year olds, 2022
- Fintech and society
- Figure 7: ZayZoon Instagram, 2022
- Immigrants are a major growth market for banks
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Marketing Campaigns
- Neo Financial broadens product line and launches ad campaign
- Figure 8: What If — Neo Financial, 2022
- Wealthsimple mocks crypto doubters
- Figure 9: Early Adopters | Wealthsimple Crypto, 2022
- Koho reaches out with reality
- Figure 10: Koho Facebook ad, 2022
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- Figure 11: KOHO: Made For Your Money, 2022
- Mydoh introduces a new financial concept to families
- Figure 12: Mydoh App | Reloadable Smart Cash Card for Kids and Teens, 2021
- Neo Financial broadens product line and launches ad campaign
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Fintech Challengers – Fast Facts
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Fintech Usage and Interest
- Usage is highest for mobile banking and payments
- Figure 13: Usage of Fintech, 2022
- Usage of payment options
- Figure 14: Payment options used and would like to use again, by age and gender, 2022
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- Figure 15: Wealthsimple Cash, 2022
- Interest in payment options
- Figure 16: Interest in payment options among those who have not used, by age, 2022
- Usage of management options
- Figure 17: Management options used and would like to use again, by age and gender, 2022
- Interest in management options
- Figure 18: Interest in management options among those who have not used, by age, 2022
- Cryptos and NFTs can set challengers apart from traditional banks
- Figure 19: NFTs and cryptocurrencies used and would like to use again, by age and gender, 2022
- Interest in NFTs and crypto
- Figure 20: Interest in NFTs and cryptocurrencies among those who have not used, by age and gender, 2022
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- Figure 21: Candy Digital Instagram post, 2022
- Usage is highest for mobile banking and payments
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Mobile Banking
- Majority of consumers value app connectivity to their bank account
- Figure 22: Attitudes related to mobile banking, 2022
- Non-users don’t see any good reason to use mobile banking
- 18-34s are most enthusiastic about financial apps
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- Figure 23: Attitudes related to mobile banking (% agree), by age, 2022
- Mobile banking features: unusual activity alerts of interest to half of consumers
- Figure 24: Usage of/interest in using mobile banking features, 2022
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- Figure 25: Usage of/interest in using mobile banking features, by age, 2022
- Majority of consumers value app connectivity to their bank account
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Digital Challengers
- Usage of newer entrants is low
- Figure 26: Usage of Fintech companies, 2022
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- Figure 27: Awareness of Fintech companies, 2022
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- Figure 28: Tangerine Instagram post, 2021
- Figure 29: Simplii Financial Instagram post, 2021
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- Figure 30: Wealthsimple desktop display, 2022
- Interest in Fintech companies
- Figure 31: Interest in using Fintech companies among those who haven’t used, 2022
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- Figure 32: Borrowell desktop display, 2022
- Figure 33: Mogo mobile display ad, 2022
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- Figure 34: EQ Bank Facebook ad, 2021
- Figure 35: Neo Financial Facebook ad, 2021
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- Figure 36: Koho Financial Facebook ad, 2022
- Figure 37: Motusbank Facebook ad, 2021
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- Figure 38: Brightside Instagram post, 2021
- Figure 39: Brim Financial Instagram post, 2021
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- Figure 40: Nest Wealth Instagram post, 2019
- Consumer sentiment is still in favour of traditional banks
- Figure 41: Attitudes related to traditional vs digital banks, 2022
- No-fee banking and higher interest on savings are noteworthy switching factors
- Younger consumers are more open to Fintech, but trust issues remain
- Figure 42: Attitudes related to traditional vs digital banks (select), by age, 2022
- Usage of newer entrants is low
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Interest in Innovations
- Almost half of consumers are interested in a fraud detection service
- Figure 43: Interest in fraud detection, men vs women vs overall, 2022
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- Figure 44: LifeLock Facebook ad, 2021
- Two in five interested in apps that teach kids about finances
- Figure 45: Interest in apps to help children learn about finances, men 18-34 vs women 18-34 and overall, 2022
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- Figure 46: Mydoh Facebook ad, 2022
- Micro-investing apps are of interest to a fifth of consumers
- Figure 47: Interest in micro-investing app that rounds up purchases to invest spare change, by age and overall, 2022
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- Figure 48: Moka Facebook ad, 2021
- One in five seniors are interested in specialized apps
- Figure 49: Interest in innovations (select), men vs women, 2022
- Bill splitting and budgeting apps appeal most to 18-34s
- Figure 50: Interest in bill splitting and paid budgeting apps, by age, 2022
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- Figure 51: Splitwise Instagram post, 2019
- Figure 52: YNAB Instagram post, 2022
- Almost half of consumers are interested in a fraud detection service
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Fintech Regulation
- More than a third would be interested in buying crypto under stronger regulation
- Figure 53: “I would be more interested in buying crypto-assets if regulation was stronger” (% agree), by age, 2022
- Canadian Web3 Council launches
- Awareness and interest in open banking is increasing
- Figure 54: Attitudes related to open banking, by age and overall, 2022
- More than a third would be interested in buying crypto under stronger regulation
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Appendix – Data Sources and Abbreviations
- Data sources
- Consumer survey data
- Teen consumer survey data
- Consumer qualitative research
- Abbreviations and terms
- Data sources
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