The financial world in Canada is changing fast. Traditional banks, known for their trust and experience, are facing new competition from fintech companies offering fresh, digital-first solutions. At first glance, it might seem like they’re at odds—but the truth is, working together is where the real magic happens.
By blending the security of banks with the creativity and speed of fintechs, the industry is creating better, more customer-focused and convenient options.
Let’s break down the key differences between banks and fintechs, look at their strengths and challenges, and explore why teaming up could be the future of finance.
When it comes to financial services in Canada, banks and fintechs bring different strengths to the table.
Banks have been the backbone of Canada’s financial system for over 200 years. You read that correctly… The Bank of Montreal was established in 1817! With their long history, they’ve built strong customer trust and deep expertise in navigating regulations. In fact, 87% of Canadian consumers trust their banks to protect their information. For many, banks are the go-to for everything from a first checking account to small business loans.
But while banks are reliable, they’re often tied to traditional processes and legacy technologies. Change can take time, and adopting new technologies or responding to shifting customer expectations isn’t always quick or seamless. In a 2024 survey by J.D. Power, a growing number of Canadians reported being dissatisfied with their banking services, seeking more guidance on how to avoid fees, build savings, and reduce debt. These are challenges that require innovative, tech-forward solutions that banks may be slow to build.
Fintechs, on the other hand, are shaking things up. These newer players focus on solving customer pain points with digital-first solutions, like seamless payment apps and personalized financial tools. They’re designed to be nimble, constantly adapting to trends and customer needs. That’s likely why investments in Canadian Fintechs hit an all-time high in 2024.
However, fintechs don’t come without challenges. Many are still building their reputation and may not have the same level of trust as established banks—proven by a 2024 survey from The Logic which found that 42% of Canadians still see fintechs as less trustworthy than banks. They also face hurdles in navigating the complex world of financial regulations—something banks have spent decades mastering.
While they seem like opposites, banks and fintechs each offer something the other needs. Banks bring stability and trust; fintechs bring creativity and fresh ideas. Together, they have the potential to create financial services that are both dependable and forward-thinking. This is a win for everyone, especially Canadian consumers.
In Canada, where consumer expectations for real-time digital services are rising thanks to global trends like open banking, financial institutions must adapt to meet these demands or risk being left behind.
For traditional banks, however, legacy systems often slow down the ability to innovate and respond to these shifting expectations. This is where collaboration with fintechs becomes essential. By leveraging fintechs’ agility and tech expertise, banks can overcome these challenges, modernize their services, stay competitive, and better serve customers.
Across Canada, partnerships between banks and fintechs are already delivering results.
For example, RBC’s partnership with Wave, a Canadian fintech offering free accounting tools for small businesses, showcases how banks can enhance their offerings through collaboration. RBC customers gain access to tools that simplify business management, while Wave benefits from RBC’s network and credibility.
By teaming up with Borrowell, a fintech specializing in credit monitoring, CIBC gives its customers easy access to tools that improve their financial literacy and help them achieve better credit health.
TD Bank has also partnered with SideDrawer, a Toronto-based fintech specializing in secure document management. This collaboration enhances TD’s digital offerings by integrating SideDrawer’s technology, allowing customers to seamlessly and securely manage their financial documents online.
At DCGroup, we have the unique opportunity to play in the best of both worlds. We combine the trust and regulatory foundation of operating a fully licensed bank, Digital Commerce Bank, with the heart, flexibility, and creativity of operating as a fintech with a fulsome API-enabled payments technology stack. We’re not just collaborating—we’re operating as both. This rare model shows how the future of finance in Canada lies in partnerships that blend the stability of tradition with the possibilities of innovation.
Collaboration between banks and fintechs is reshaping Canada’s financial landscape. By combining trust, stability, and innovation, these partnerships create smarter, more customer-focused solutions.
Is your business ready to benefit from the best of both worlds? Discover how DCGroup’s unique approach can help you navigate the future of finance. Let’s start the conversation today.