Canadian fintechs are flocking to the UK, whilst Canada is considering opening up the banking sector to them.
But what is fintech?
Well, it used to be a term to denote any technology or technology firm which dealt with the back operations for a financial institution, like compliance. But since the start of the 2010s, it’s come to mean any developments in financial education, investments and cryptocurrency.
Across the pond
The UK’s fintech scene is big.
And it’s projected to grow even further.
This trend is being driven by advisor fees.
New UK rules moved advisory fees from commission based to upfront charges. This meant that smaller investors have been deterred from paying for advice and some advisors are unwilling to take on such consumers.
Canadian firms like Wealthsimple see an opportunity.
Even though Brexit is causing panic and uncertainty, they see their robo advice service as a way to offer advice to smaller investors, in a more cost effective way.
And back home, things could be heating up
Fintech isn’t big right now. In fact, it’s lagging behind the global average.
But this could change: the government is currently considering whether to allow Canadian consumers greater sharing powers over their banking data. This would allow big tech firms, like Google and Facebook, who have fintech operations, to compete with the traditional banking set.