Decoding Fintech in Canada

By | Finance

Two financial technology articles with significantly different tone have been published in recent days, one by Forbes and one by Canadian Business magazine. Both centering on analysis of a broader context in which to place the evolving trajectory of fintech in Canada.

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As stock values for some North American fintech startups with significant investor backing have fallen in recent weeks, many financial analysts are beginning to engage in more detailed attempts to categorize the industry during this transitional period.

For Canadian Business, Joe Castaldo wrote:

Market forces run the risk of getting skewed from the ‘Fin’ part to the ‘Tech’ side of FinTech, i.e. the credibility required to build a successful and sustainable financial services company runs the risk of being trumped by the visibility and growth-at-any-cost approach of many successful tech companies.

And for Forbes, Goncalo de Vasconcelos noted that an analyst from an American firm

prefers to think of them as “tech-enabled finance firms.

These statements point to a telling commonality: alternative lending is not simply a technology showcase. Customers care deeply about the accessibility and service components that alternative lenders can offer in order to help them meet their financial needs, and it is also on the financial services side of the business that investor confidence will be established and retained.

As the language around financial technology shifts, the importance of being consumer-focused and socially responsible will eventually outshine the wow factor of raw, uncontextualized innovation or “disruption.”

 

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