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10 Canadian FinTech start-ups worth your attention

10 Canadian FinTech start-ups worth your attention

Posted by PanamericanWorld on July 04, 2016

Peruse the Websites of FinTech start-ups and you won’t see any actually telling the banks “we’re coming to eat your lunch” — but they might as well post that message. These start-ups all target the fundamental profit centres long enjoyed by the big banks and other financial institutions, including bond trading, basic bank accounts, retail Point of Sale, international money transfers, loans and investment services.

Company: Overbond

Location: Toronto

Elevator pitch: Canadian bond dealers and issuers exchange more than 2.3 million bond-pricing emails per year. There has to be a better way

Why it’s important: Overbond bps is an “end-to-end, two-way pricing communication tool for bond issuers and dealers,” one the company claims is the first in existence. This has the potential to automate and improve an outdated and labour-intensive process. The goal, the company says, is to make bond issuance digital, transparent and secure. And the company closed a $7.5-million seed financing round with Morrison Financial Services in June.

Company: Financeit

Location: Toronto

Elevator pitch: Boost your sales with consumer financing

Why it’s important: Technology often helps smaller companies look like bigger companies; Financeit makes it easier for its clients to offer promos like "0% financing!” or “Don’t Pay for 12 Months” that usually only big-box retailers and other established players can deliver.

Company: BitGold

Location: Toronto

Elevator pitch: Buy gold, store gold, spend gold, send and receive gold

Why it’s important: BitGold’s callback to the original international currency is enough to place it on this list, but the company has more going for it than that: gold is, after all, the century’s best-performing currency (at least according to the company). BitGold uses technology to marry the permanence of gold to the convenience of Prepaid MasterCards.

Company: ChangeJar

Location: Ottawa and Toronto

Elevator pitch: Buy a coffee, get change, store that change on your phone

Why it’s important: FinTech is about using technology to build innovative financial functionality. ChangeJar is a great example. When you drop a toonie and loonie on the counter for your morning dark roast, you can pocket the $0.35 in change or the café can scan the ChangeJar code on your phone and add those cents to your running balance. Later you can spend it, donate it or send it to a friend. As with all start-ups, the devil is in the scale: launched officially in May 2016, ChangeJar is accepted at eight Ottawa businesses, and future success will depend on how fast the company can add participating retailers.

Company: FrontFundr

Location: Vancouver

Elevator pitch: Become an investor in a startup business

Why it’s important: FrontFundr piles risk on risk: first, any investment has some risk; second, the company connects investors with start-ups looking for cash. That explains the blunt pop-up box on the company’s site, which reads in part: “The investment opportunities posted on this portal are risky and may result in the loss of all or most of your investment.”

The site is a great vehicle for investors looking to indulge their entrepreneurial interests.

Company: Koho

Location: Vancouver

Elevator pitch: No-fee, simple, mobile alternative to a chequing account

Why it matters: Koho (a 2016 Branham300 Up and Comer) is working to tap into the disenfranchisement millennials feel with traditional banks, as it explained in an April 2016 post on reddit:

“With Koho, you can do all the things you do already: Direct Deposit, ATMs, E-Transfers, etc. We also do a bunch of stuff that banks don’t, like goals, automatic budgets, spending insights, card suspensions (if you forget it somewhere) and the best part is there is no monthly fee... Our model is really simple - we're not a bank but we know how important keeping your money secure is. We partner with Peoples Trust, which is a federal trust with more than $6 billion in assets, to hold your money. We also partnered with Visa so we could issue you a beautiful Koho card which allows you to spend everywhere Visa is accepted and covers you with Visa’s Zero Liability Purchase Protection."

Company: Lendful

Location: Vancouver

Elevator pitch: Quick and easy access to loans at better interest rates

Why it’s important: Lendful takes on the loan end of traditional banks, explaining “we’re tired of outdated borrowing systems that are complicated and expensive. We want to offer you the means and the time to build your lives, not the banks’ bottom lines.” The company promises to save borrowers “up to 30% when refinancing” and if that’s true then this is another threat to the Big 5.

Company: PaymentRails

Location: Toronto

Elevator pitch: Pay the people you work with — anywhere in the world

Why it’s important: The business world is international, but payments are mired in currency and jurisdiction rules. PaymentRails supports payments made from Canada through bank transfers to more than 70 countries and 50-plus currencies, and SWIFT transfers in more than 125 currencies; Visa and MasterCard transfers; cash pickup at more than 400,000 locations; paper cheques; and other methods. Payments can come from PayPal accounts, Bitcoin, bank cheques and some e- wallets. It’s an international play from a Canadian start-up.

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