Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: ESG, Financial Inclusion, Sustainable Finance
Planetary Health Check 2024 and Canadian Climate Tech
ESG | Feb 14, 2025
Image: Planetary Health Check (1st Edition, Planetary Boundaries)
Seizing the Green Economy: The State of the Planet and Fintech Opportunities
Planetary Boundaries Science published the inaugural edition of the 2024 Planetary Health Check, (view 96 page PDF report) that delivers a scientific assessment of the current state of mother earth, revealing urgent environmental challenges that are in need of sustainable finance strategies and investments. All of this points to the growing focus of sustainable finance, green fintech, and climate risk mitigation. Canadian policymakers, institutions, and financial technology startups have a key role in supporting the transition towards a sustainable economy.
Key Statistics and Fintech Solutions
It's important for financial leaders to recognize the biggest environmental challenges we collectively face today. Below are key statistics derived from the Planet Health Check 2024 report, along with select innovative Canadian fintech and climate tech companies working to solve these problems:
1. Climate Change
- Carbon dioxide levels in the atmosphere have risen to 419 ppm, higher than at any point in the past 15 million years.
- Average global temperatures are now 1.2°C warmer than before the industrial era, leading to more extreme weather events.
- The Earth’s energy balance has been disrupted, with radiative forcing exceeding the safe limit of +1.0 W/m², now at +2.79 W/m², intensifying global warming.
- CarbonCure Technologies turns captured CO₂ into sustainable concrete, reducing emissions in the construction industry. CERT Systems converts CO₂ into valuable fuels and chemicals, supporting a circular carbon economy.
2. Biosphere Integrity and Biodiversity Loss
- Over 75% of the Earth’s land surface has been significantly altered by human activity.
- Loss of species diversity is happening 100 to 1,000 times faster than the natural rate, threatening ecosystems and food security.
- The amount of energy supporting ecosystems has dropped by over 20% worldwide, disrupting the balance of nature and harming wildlife habitats.
- Veritree uses blockchain to track and verify reforestation projects, ensuring transparency in ecosystem restoration investments.
3. Land System Change
- The world's forests are shrinking at an alarming rate, with the Amazon rainforest alone having lost 17% of its total tree cover, pushing forest loss beyond safe limits.
- Every year, more than 10 million hectares of forests are cleared, mainly to make space for farming, infrastructure, and resource extraction, accelerating habitat loss and climate change.
See: The Role of Fintech in the Circular Economy
- Summit Nanotech is pioneering sustainable lithium extraction, reducing the land degradation caused by traditional mining operations.
4. Freshwater Use and Scarcity
- More than half of the world's major rivers now go through severe water shortages at certain times of the year.
- Soil moisture levels have become 15% more unpredictable since the early 1900s, making it harder to grow stable food supplies.
- Farmers Edge uses AI-driven precision agriculture to optimize water usage, reduce waste, and improve yields, helping to secure food supply chains.
5. Nutrient Pollution from Fertilizers
- The amount of nitrogen added to the environment by fertilizers and industry is now 190 million tonnes per year, which is more than twice the natural level.
- Excess phosphorus from farming has created over 500 oxygen-depleted zones in the oceans, covering an area of more than 245,000 square kilometers, harming marine life.
- e-Zinc pioneers zinc-based energy storage, enabling long-duration renewable energy storage and reducing reliance on synthetic fertilizers for energy-intensive farming.
6. Pollution & Waste
- The world produces over 400 million tonnes of plastic every year but only 9% of it gets recycled, leaving the rest to pollute land and oceans.
- More than 350,000 synthetic chemicals are in our environment today, and many of their effects on nature and human health are still unknown.
- Climate Smart and Carbonhound provide carbon management tools for Canadian companies, helping them measure and reduce pollution and waste while improving ESG compliance.
Policy and Regulation
Canada is making it mandatory for businesses and financial institutions to disclose climate-related information. The federal government has introduced new rules based on the Task Force on Climate-related Financial Disclosures (TCFD) guidelines.
- Starting in 2024, banks, insurance companies, and other federally regulated financial institutions must report their climate-related financial risks according to TCFD framework.
- The government is changing the Canada Business Corporations Act (CBCA) to require large private companies to report their climate-related financial impacts.
- Canada is also creating clear guidelines for sustainable investments to prevent greenwashing and set clear standards for climate-related investments.
Climate Tech Investments and Incentives
Canada has committed substantial funds to climate technology innovation, presenting a major investment opportunity:
See: RBC and Carbonhound Partner to Automate Carbon Management
- In 2023, climate tech investment in Canada reached $1.1 billion in cleantech.
- Canada introduced tax credits to support clean technology, including the Clean Technology Investment Tax Credit (CT ITC) and the Clean Economy Investment Tax Credits, which offer refundable tax credits for businesses investing in clean energy, clean hydrogen, and carbon capture. (Government of Canada)
- BDC Climate Tech Fund itself is allocated $400 million, however BDC's total clean and climate tech commitment is $1 billion
Outlook
The Planetary Health Check 2024 is (another) wake-up call for the financial industry. Canadian fintechs and investors have an opportuity to make a difference by focusing on climate-focused investments, green financial innovations, and sustainable business models. With billions in investment and grant opportunities already available, financial leaders can take advantage of growing climate tech opportunities and help Canada become a global leader in sustainable finance.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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RBC and Carbonhound Partner to Automate Carbon Management
ESG | Feb 13, 2025
Image: Freepik
RBC and Carbonhound Partner to Bring Automated Carbon Management to Canadian Businesses
On February 20, 2025, RBC announced an ESG collaboration with Carbonhound to provide automated carbon management solutions for Canadian companies. This sounds like a great initiative where businesses of all sizes are increasingly under pressure to track and reduce their carbon footprint. Technology is helping small and medium-sized (SMEs) companies in particular who struggle with the complexities of carbon reporting, empowering how they approach sustainability.
See: How Carbon Pricing Impacts Fintech and Investment Strategies
Niranjan Vivekanandan, EVP and COO, Commercial Banking at RBC:
"We are excited to work with Carbonhound to offer our clients an accessible solution that is designed to manage and report carbon emissions. Together, we aim to enable Canadian businesses to make and measure progress in their transition to a low-carbon economy."
Why Carbon Management Matters for Businesses
The Canadian government pledged to reach net-zero greenhouse gas emissions by 2050 backed by the Canadian Net-Zero Emissions Accountability Act, which became law on June 29, 2021. The law requires government to set emission reduction targets and enable plans to achieve them. Canada is currently aiming to reduce emissions by 40-55% below 2005 levels by 2030.
As governments set goals to reduce carbon emissions and investors focus more on sustainability, businesses are feeling the pinch and the need to step up their game in tracking emissions. However, traditional carbon reporting relies on manual data collection, spreadsheets, and external consultants which can be slow, expensive and subject to errors. For many SMEs, keeping track of their carbon footprint is challenging and takes up too much time.
See: Davos 2025 Themes and Takeaways for Fintech
SMEs account for 99.8% of Canadian businesses and were responsible for 41% of the country’s greenhouse gas emissions in 2020. However, according to a KPMG 2023 business survey while 78% of Canadian SMEs have policies to reduce emissions, the majority of them 70% report that they lack the time and resources to implement them effectively. Compliance costs and lack of expertise often prevents smaller firms from activating sustainable efforts. Automating carbon tracking can help companies overcome these barriers towards making real progress.
Sanders Lazier, CEO and Co-founder of Carbonhound:
"Sustainability reporting has become table-stakes for businesses that want to work in global supply chains and attract top-tier talent. We are excited to work with RBC to help enable Canadian businesses to compete more effectively and expand their margins through sustainability data."
How RBC and Carbonhound’s Partnership Works
The Royal Bank of Canada (RBC), one of Canada’s largest financial institutions, is partnering with Carbonhound a company that makes tracking carbon emissions easier by connecting directly to business data and providing real-time insights into emissions. It also helps businesses create reports that follow major sustainability rules, making it easier to stay compliant and be more transparent.
The partnership brings a set of solutions designed to:
- Track emissions automatically using real business data including Scope 1, 2, and 3 greenhouse gases
- Create carbon reports that meet sustainability reporting standards
- Offer practical steps to help businesses lower their emissions, such as insights to set realistic reduction targets and identify cost-saving strategies
- Ensure compliance with increasing sustainability regulations including the Greenhouse Gas Protocol and ISO 14064
Also worth noting, on February 1, 2025, Carbonhound announced a partnership with Manifest Climate, which uses AI to guide businesses through evolving regulatory landscapes to make climate reporting more accessible and actionable.
Impact on the Canadian Market
Canada’s financial rules are changing to push businesses toward sustainability. With the government and regulators focusing on ESG reporting, companies that don’t adapt could lose funding or face stricter rules.
See: Tech Leaders Launch Build Canada for Innovation Policy Reform
RBC has been a leader in sustainable finance, first pledging $100 billion by 2025 but after reaching that goal ahead of schedule the bank increased its commitment to $500 billion by 2025, showing continued dedication to help companies adopt more sustainable practices (learn about RBCs climate commitments).
The RBC-Carbonhound partnership helps all Canadian businesses especially SMEs, which often lack the resources for sustainability efforts and carbon reporting. As more businesses use these tools, Canada’s economy will be better prepared to compete in a world that values sustainability.
Conclusion
As Canada pushes toward its net-zero goals, partnerships like RBC and Carbonhound can help companies turn sustainability from a challenge into an opportunity and competitive advantage while staying compliant, attracting investment, and reducing their environmental impact.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Rachel Reeves: UK’s Financial Innovation Blueprint
Fintech Policy | Nov 19, 2024
Image: Chancellor of the Exchequer Rachel Reeves
Financial Innovation Vision from the UK's New Chancellor of the Exchequer, Rachel Reeves
The UK has a new Chancellor of the Exchequer, Rachel Reeves, who took office four months ago, delivered her first Mansion House speech on November 14, 2024 to set out her vision for the UK economy. The Chancellor is seen as the second most powerful position in the UK government after the Prime Minister, and has significant control over the country's economic direction and priorities, and works closely with businesses, financial institutions, and global partners to protect and grow the economy.
See: UK Digital Securities Sandbox to Drive Fintech Innovation
In her first major speech, the UK is doubling down with a mix of new technology and financial innovation including the creation of a stock exchange for growing businesses to using blockchain to issue government bonds. Her innovative plans reach pensions, green finance, open banking, and capital markets all to boost growth, attract investment, and make the UK a global leader in financial innovation. Here's a closer look at some of the key announced initiatives and why they matter.
1. A New Stock Exchange Called PISCES
Her speech announced the launch a new stock exchange by May 2025 called Platform for Innovation, Scaling Companies, and Emerging Sectors (PISCES) (Platform for Innovation, Scaling Companies, and Emerging Sectors) designed to help fast growing companies secure the scale-up funding they need to grow and succeed. Part of the idea is to shift capital markets to better support smaller companies with high potential that often face challenges in raising funds or going public.
See: Corporate Venture Capital in Canada: Insights and Challenges
A specialized exchange like this could help attract global investors and provide more liquidity for these companies to access. In Canada, there's the TSXV and CSE both of designed to benefit attractive startups in accessing public markets.
2. Government Bonds on Blockchain
Reeves also announced the pilot launch of a blockchain-based platform to issue government bonds called Digital Gilt Instruments (DIGIT). By using the latest distributed ledger technology (DLT), the UK hopes to improve bond issuance by making it faster, cheaper, and more transparent. For decades, the bond issuance process has largely been untouched. A pilot like this could help transform public finance, offering insights and valuable lessons for governments globally looking to modernize their systems.
Rachel Reeves, UK Chancellor of the Exchequer
“Using distributed ledger technology for DIGIT marks a step change in how we issue government debt, making the process more efficient while maintaining investor confidence.”
3. Creating Pension Megafunds
Reeves announced plans to consolidate local government and work pension plans into Canadian or Australian style 'megafunds' to grow the UK economy. In doing so, she anticipates it to unlock about £80 billion for investment for infrastructure, housing, high growth initiatives. She makes it clear that this is a new strategy in how retirement savings are managed and prioritized in the UK, and such megafunds should be designed to benefit British savers instead of the Canada Pension Plan Investment Board profiting from UK assets.
See: Public Market Challenges and Equity Crowdfunding Capital
Rachel Reeves, UK Chancellor of the Exchequer
"We must ensure that British savers benefit from the returns on productive assets, not just Canadian teachers and Australian professors investing in the UK."
4. Lead the Energy Transition
In her speech, Reeves positioned the United Kingdom as a pioneer in sustainable finance and announced a framework for raising private capital for green projects such as wind farms and solar energy. The plan is to launch the Transition Finance Council in partnership with the City of London Corporation and industry leaders that will work to ensure companies have access to decarbonization finance.
See: AI Leaders and White House Discuss Energy Infrastructure
Given Canada's renewable energy potential, Canada could establish a similar task force focused on attracting private capital for clean energy projects. Collaboration with the UK's Transition Finance Council could help accelerate global efforts to support the energy transition.
5. Regulatory Reform for Growth
Reeves speech mentioned a few ways to recalibrate financial regulations to encourage innovation and growth without compromising stability such as overhauling consumer financial advice rules, and reducing banker pay deferral periods to attract top talent.
See: Insights from the UK’s Pro-Innovation Regulation Review
Rachel Reeves, UK Chancellor of the Exchequer:
“We’ve been regulating for risk, but now it’s time to regulate for growth.”
6. Open Banking and Fintech
She doubled down on the UK's National Payments Vision reaffirming the UKs commitment to open banking, ensuring that customers benefit from improved services from safe data exchange.
Rachel Reeves, UK Chancellor of the Exchequer:
"We are laying the groundwork for London to remain the global hub for financial technology."
Open banking is still developing here in Canada but adoption and growth lessons from the UK can help Canada accelerate the implementation of the initiative which is called 'consumer-driven finance'.
Why It Matters
Rachel Reeve's speech lays out a solid blueprint for using technology and smart policies to drive economic growth for the UK. It's a clear message that says in order to stay competitive, the country has to take bold steps and be open to change. Lessons that Canada should learn from.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Accelerating Financial Innovation and Access in Canada
Canadian Innovation | Nov 13, 2024
Image: Freepik/www.slon.pics
How Canada Can Speed Up Financial Innovation and Serve More People
At Elevate FinTech Stage 2024, BetaKit hosted two conversations that highlight both the challenges and opportunities Canada faces in its financial sector. Together, these sessions reveal an urgent need for Canada to catch up on financial innovation. Here’s a look at what was discussed and some fresh ideas Canada can look to adopt if interested in driving real progress.
- The first session with Koho’s Daniel Eberhard and Peter Aceto focused on the obstacles of becoming a licensed bank and balancing speed with regulation.
- In the second, Josh Scott from BetaKit discussed barriers to financial inclusion with Eva Wong of Borrowell, Manzil’s Mohammed Sawwaf, and Julien Brazeau from the Department of Finance.
Session 1: Koho’s Banking License Journey and Balancing Product Innovation
Koho CEO Daniel Eberhard and Chief Banking Officer Peter Aceto shared how becoming a licensed bank would help Koho to lower costs, control its financial products, and offer benefits directly to its customers. But the process has been long and complicated with the Office of the Superintendent of Financial Institutions (OSFI) imposing unpredictable timelines and criteria.
See: Canada Post Expands into Financial Services with KOHO
To protect their ability to innovate quickly Koho split off into two divisions: one for tech and one for banking. This setup allows them continue building new features while managing the regulatory demands of becoming a bank.
Daniel Eberhard, CEO Koho:
“We’d be really foolish to bet the business on something as unpredictable as the bank license process.”
He stressed that Koho would pivot if the banking license path became too restrictive, doubling down on Koho's commitment to innovation.
Panel Takeaways:
- Securing a bank license comes with significant regulatory hurdles and compliance requirements. Koho is carefully weighing the costs/risks with the benefits.
- Koho is continuing to innovate without waiting on regulatory approval by cleverly separating tech and banking into separate divisions.
- Koho’s story highlights how difficult it is for Canadian fintechs to break into the traditional banking sector. Without a clear path, companies like Koho must decide how much time and money they’re willing to risk.
Session 2: Financial Inclusion and Barriers to Access
In the second panel, Josh Scott led a conversation on financial inclusion with Eva Wong (Borrowell), Mohammed Sawwaf (Manzil), and Julien Brazeau (Department of Finance). The discussion focused on why many Canadians, especially those in niche communities, remain underserved by the traditional banking system. Wong pointed out that, although most Canadians have a bank account, many are “underbanked”—lacking access to the range of services they need. Sawwaf explained that for Canada’s 2 million Muslim citizens, the absence of halal banking options has excluded a large group from mainstream financial services.
Julien Brazeau commenting on Canada's slow approach to open banking:
“Six years is far too long for anyone to consider fast.”
Panel Takeaways:
- There’s a growing need for financial services that address the needs of specific groups like new Canadians, remote communities, and religious groups.
- Brazeau admitted that the government has been slow to work directly with fintechs, a gap that has delayed innovation and frustrated financial startups. There's a lack of collaboration.
See: Canada’s SMBs Deserve Better Banking. Lessons from US Fintechs
- After 6 years, Canada’s open banking implementation is still incomplete and the delays are stifling competition and are making it harder for Canadians to get the services they need.
Image: Freepik/Canada day
Ways Canada Can Drive Financial Innovation in Canada
Here are just a few innovative approaches that could propel Canada's financial ecosystem forward.
1. Fast track the implementation of open banking and enable the sharing of credit data from the start
For open banking to have an impact right from the start in Canada, credit data portability should be possible from the initial launch. This would enable customers to transfer their credit history between institutions smoothly thus minimizing obstacles and simplifying the process of changing service providers.
See: Open Banking: Revolutionizing Financial Data Sharing
Such an approach would establish a best practice where fintech companies could provide services to individuals encountering difficulties in accessing credit, such as those with unconventional or limited credit backgrounds (that are underserved by the banks).
2. Make it necessary for government financial programs to be compatible with Open Banking standards
When open banking is fully implemented in Canada the government could promote its usage by making it a requirement for government initiatives like business loans and housing support to be compatible with open banking standards. By enforcing this rule, banks and financial technology companies would have to follow banking protocols making it easier for Canadians to access these services no matter which institution they are with. This approach aims to increase collaboration within the industry without relying on voluntary adoption by private entities.
3. Create a "Digital Financial Inclusion Fund" to broaden access, for interest groups
Canada could establish a "Digital Financial Inclusion Fund" similar to initiatives in Singapore and the EU to address the financial needs of marginalized communities by supporting fintech companies in developing specialized products for groups such as rural residents and underserved populations with limited access to traditional banking services. This would be a collaborative effort involving the government of Canada and the private sector and its partners.
4. Tiered licensing system could help smaller fintech companies enter the market more smoothly
Canada could consider implementing a strategy like in Australia with a restricted banking license regime which permits fintech firms to offer services as they grow. This approach would enable startups to connect with customers on and gradually meet full qualifications without sacrificing security or consumer safety.
5. Establishing a Unified Digital Identification System for financial services
Influenced by India's Aadhaar and Estonia's e-residency initiatives a government supported digital identification system could enhance Know Your Customer (KYC) procedures within Canada's institutions. With a digital identity Canadian citizens could safely use financial services reducing the time consuming and frequently repetitive account setup processes.
See: The Trifecta of India’s Digital Transformation is Turning Heads Globally
The government management of a digital ID system would streamline access for Canadians living in underprivileged areas and potentially link with open banking to ensure secure data sharing practices. Data privacy may be a concern however.
6. Establish a program for fostering partnerships between Fintechs and Banks to offer financial solutions
Canada could create a program to encourage partnerships between banks and fintech companies to focus on financial inclusion projects. Inspired by Brazil where banks and fintechs have teamed up to serve underserved communities, this program would encourage similar collaboration in Canada for initiatives like microloans, financial education, and better digital banking services in remote areas. Rather than mandating these partnerships, the government could offer incentives, such as tax benefits or lighter regulatory requirements to banks and fintechs that meet goals for reaching underbanked populations. This would allow both sectors to work together to create practical solutions that benefit consumers and support Canada’s financial inclusion goals.
Closing Thought
Creating a faster, more competitive, and more accessible financial ecosystem requires bold action, a risk-taking mindset (with the benefits in sight) and proactive partnerships between the government, banks, and fintechs.
See: Canada’s Innovation Paradox – Strong Start, Missing Impact
By embracing innovative approaches and learning from global successes, Canada can move beyond slow timelines and limited access and work towards becoming a leader in financial inclusion.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Key Findings from 2025 Advanced Payments and Fintech Survey
Fintech and Payments Research Report | Nov 12, 2024
Image: Advanced Payments and Fintech Report 2025 (Edgar, Dunn and Co.)
Insights and Opportunities for Global Payments and Fintech Innovations 2025
Edgar, Dunn & Co. has just dropped the 17th edition of the 2025 Advanced Payments and Fintech Survey (103 page PDF report) digging into the latest innovations and momentum powering the global payments industry forward. The report brings together insights from a 100 senior payment professionals from around the world who explore the influence of emerging technologies like AI, IoT, and blockchain, the rise of digital banking, and the impact of alternative payment methods and Central Bank Digital Currencies (CBDCs).
See: 2024 Global Payments Growth, Trends, and Fintech’s Edge
This post by NCFA Canada highlights the key findings from the payments survey and uncovers the latest data-driven and actionable insights to propel your business forward, providing a strategic roadmap for growth.
Key Findings from the Advanced Payments Survey
The survey was hosted between May and July 2024 with responses from 100 senior payments professionals around the globe.
1. Top Use Cases for AI and Machine Learning in Payments
- 85% of respondents see AI’s primary role in risk management and fraud detection.
- 51% identified customer behavior analytics as a growing application of AI.
- 55% say automating operations for error-free and quicker payments is a priority.
2. B2B Cross-Border Payments in Play
- 52% of respondents said B2B payments are the main focus for cross-border innovations given the demand for efficient and low cost international transactions.
See: AI, Funding Shifts and Regulatory Hurdles in Fintech 2024
3. Sectoral Growth in Digital Payments
- Retail and e-commerce are expected to lead digital payment adoption (65%), with remittances (48%) and travel (46%) also ready for growth.
4. Future Growth in Payment Methods
- Digital wallets (88%) and bank transfers (57%) dominate the future payment landscape, a shift away from traditional credit card payments.
- Buy Now Pay Later (BNPL) solutions are also gaining traction, particularly among younger consumers.
5. Mobile Solutions and Instant Payment Demand
- 68% of respondents expect instant payments to become standard, as consumers demand faster and more convenient transactions.
6. Influence of Regional Trends
- Asia-Pacific leads in expected payment innovations (50%), with Europe following at 23%. Canadian Fintechs can look to these regions for inspiration in mobile and instant payments.
7. IoT’s Role in Enhancing Payments
- IoT devices for payments such as wearables and connected cars are gaining momentum, particularly in retail and automotive sectors.
8. The Role of Security in Mobile Banking
- 63% of respondents stress the importance of biometric authentication to enhance mobile banking security.
- Real-time payment features are equally critical with 57% saying these as essential for consumer trust.
9. Open Banking and Open Finance as Innovation Catalysts
- According to the majority of responders, Open Banking is remain a major driver for financial innovation that enables third party access to financial data, fuelling the rise of customer-centric financial ecosystems. Open Banking is evolving into wider initiatives like Open Finance and Open Data, creating opportunities to enhance competition and improve customer experiences. (See: OECD 2023: Key Insights on Open Finance Policies | EU: MiCA, DORA, Open Finance Framework, and Digital Euro)
Image: Freepik/rawpixel.com
Strategic Insights from the Report
1. Digital Banks and Profitability
- Digital banks have seen huge growth but most still aren’t profitable (some are).
- Around 85% struggle with high customer acquisition and operating costs.
- Cutting acquisition costs by using AI for targeted marketing can save them up to 25%.
- Automating manual processes can trim costs by 30%.
- If digital banks can get customers to make digital banks their primary accounts it can make a big difference since primary account holders contributing almost 70% more in revenue.
2. AI and Machine Learning in Payments
- AI is transforming payments with powerful tools for fraud detection, personalization, and efficiency.
- Payment processors like Visa analyze millions of transactions per second with AI, catching suspicious activity instantly and reducing fraud-related losses by up to 30%.
- AI automation has been shown to reduce payment processing times by half, saving labour costs.
See: How Real-Time Agentic AI Will Boost Fintechs
- Personalized AI-based customer service is another advantage (becoming a new standard) with approx 45% of consumers now expecting personalized digital experiences whe it comes to their financial services.
3. Blockchain as a Cross-Industry Solution
- Blockchain technology reduces cross-border remittance costs by as much as 60%, thanks to its ability to remove intermediaries and process transactions directly. This savings potential is huge for the $750 billion remittance market.
- Blockchain’s secure, decentralized structure has reduced fraud cases by up to 30% in companies using it.
- Its versatility also extends beyond finance to industries like supply chain management and insurance who use blockchain to ensure transparency and accuracy in their operations. (See: Investing in the Future of AI and Blockchain)
4. IoT Payments Transforming User Experiences
- IoT-enabled payment devices such as wearables or connected cars are set to reach $6 billion in transaction value by 2028 with roughly 20% of consumers adopting these options especially in the retail and automotive sectors. See: Autonomous IoT Transactions and Micropayments
- Visa’s connected car technology allows drivers to pay for fuel directly from their vehicles, while Samsung’s wearable devices make payments as simple as a tap.
- Businesses benefit from real-time data insights that can boost sales by up to 25% through personalized offers and loyalty programs.
5. Alternative Payment Methods (APMs) and Mobile Wallet Growth
- Alternative payment methods, especially mobile wallets are on track to overtake credit cards as the primary payment choice by 2028.
- Mobile wallets already account for nearly 60% of online transactions in Asia, showing their global growth potential. However, the lack of compatibility between wallets (especially cross border) will limit usage until interoperability.
See: The Role of Fintech in the Circular Economy
- It’s estimated that increasing wallet interoperability could boost transaction volumes by around 30% with companies like Apple Pay and Alipay leading the charge in wallet expansion.
6. Central Bank Digital Currencies (CBDCs) in Cross-Border Payments
- Central banks are exploring CBDCs but most retail CBDCs face slow adoption.
- Wholesale CBDCs show promise in reducing cross-border transaction costs by 50% according to central bank estimates.
- China has issued over 180 million digital yuan wallets reaching $250 billion in transactions, while the European Central Bank is aiming for a digital euro by 2027.
- These efforts illustrate how countries are exploring CBDCs to make international payments faster and more cost effective.
7. B2B Cross-Border Payments and Fintech’s Role in Efficiency
- Traditional B2B cross-border payments face high costs, delays, and FX fees, often adding up to 8% in extra expenses.
- Fintech solutions are addressing these inefficiencies by cutting out intermediaries and offering better exchange rates.
- Companies like Ripple and Wise save businesses around 20% in transaction fees.
- The B2B cross-border market is projected to reach $56 trillion by 2030, and fintech solutions are essential in making these transactions more efficient and affordable.
8. Open Banking’s Evolution to Open Finance
- Globally, open banking is expected to grow to a $123 billion market by 2031, with platforms like Plaid and Moneyhub demonstrating the potential for open finance to enhance financial services.
- Data from a recent PwC study indicates that 72% of global Fintech investors favor open finance ecosystems due to their potential for customer retention and revenue growth.
See: Canada’s Innovation Paradox – Strong Start, Missing Impact
- Canada lags behind in open banking adoption limiting its fintech sector’s growth as investors are beginning to look outside Canada for open finance opportunities. Embracing open finance could boost competition and consumer choice, opening doors for more innovative financial products.
- 63% of Canadian consumers are interested in services that aggregate their financial data for streamlined financial planning. However, only 15% of Canadian banks currently offer comprehensive data-sharing capabilities.
- The UK has led the way with over 7 million open banking users and a 15% year-over-year growth in payment transactions linked to open finance. Canada’s hesitant rollout could place it at a disadvantage if regulatory and technical hurdles are not addressed quickly.
9. Digital Remittance Transformation
- Digital remittance solutions like Remitly and Xoom have significantly lowered transfer fees from traditional methods 7-10% to around 2-3% rates.
- Digital remittance is growing 10% annually, especially in areas with high migration rates such as Canada, offering an affordable alternative for underserved populations.
- Digital remittance platforms support financial inclusion by reducing fees which enables remittance families to retain more income for daily needs or investment.
10. Financial Inclusion Through Innovative Payment Solutions
- Roughly 24% of the global population is still considered unbanked (typically in emerging markets).
- Mobile money and digital wallet services are addressing this gap.
See: How Fintechs Are Tackling Financial Inclusion in Canada
- Greater financial inclusion through digital payments could add $3.7 trillion to emerging markets’ GDP by 2025.
- Kenya’s M-Pesa service exemplifies how mobile finance can provide essential banking services without traditional banks. Other countries can follow suit by improving digital infrastructure.
11. Insurtech and Embedded Finance Driving Financial Innovation
- Insurtech is growing rapidly with the market expected to hit $152 billion by 2030.
- Advanced data analytics let insurers offer custom policies, adjusting based on real-time user data.
- The offering of financial services by non-financial platforms via embedded finance is helping companies improve user experiences. For example, Shopify’s embedded financing options make it easier for small businesses to access funds directly on its platform with integrated services.
12. Evolving Retail and Gig Economy Payment Models
- Personalizing retail experiences increases purchase likelihood by about 40%, making social commerce and omnichannel strategies more essential.
- Gig economy workers and small businesses want real time payments. Half of gig workers prefer platforms offering instant payouts.
- Real-time payments also reduce administrative work for platforms so transactions run more smoothly and offer a better user experience.
13. The Resilience and Decline of Cash Usage
- Cash is losing ground worldwide as digital payments rise with some countries seeing cash used in less than 5% of transactions.
- Having said that, cash still plays a key role in areas with limited digital access or where people have less trust in banking institutions.
- While cash usage may continue declining, local economies and infrastructure gaps mean it won’t disappear anytime soon.
Closing Thoughts
The convergence of emerging technologies and their adoption globally reveal major shifts in global payments representing significant opportunities for fintechs as AI, IoT, blockchain, digital banking, open and embedded finance broaden access to financial services, making corss-border transactions faster and easier than ever before.
See: Industry Reports and Research
For fintech founders and investors, the survey uncovers prime areas for growth. Companies need to prepare for a more connected financial ecosystem and high bar for speed and inclusiveness to meet today's demand. Integrating these technologies and tools is about building a future of finance that's user-friendly, secure, and accessible.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Canada Post Expands into Financial Services with KOHO
Fintech Partnership | Nov 11, 2024
Image courtesy of AI
Canada Post and KOHO Team Up to Bring Banking Services to Underserved Canadians
Canada Post and KOHO, a Canadian fintech company, are teaming up to offer basic banking services across Canada. This aim of the partnership is to bring KOHO's chequing and savings accounts, prepaid Mastercard, mobile app access, and financial tools to more people, especially those in remote or underserved areas. According to recent data, 15% of Canadians are still underserved by traditional financial institutions.
See: KOHO Secures $190M to Move Towards Banking Power
Canada Post can use its network of over 6000 locations coast to coast to improve banking services to those who might struggle to reach a traditional bank. Other countries are seeing similar trends, as postal services look to provide financial options for those who need them most. The United States Postal Service (USPS) began a pilot project in 2021 offering limited check cashing services at some locations to help people who don't have access to a bank account.
Canada Post Looks to Diversify into Financial Services
Canada Post has been under financial pressure in recent years with rising operational costs and declining traditional 'snail mail' volumes because of the onslaught of digitalization. In Canada Post's 2023 annual report, they reported a pre-tax loss of $748 million up from $548 million the previous year. Back in 2021, Canada Post announced 'A Stronger Canada - Delivered' plan which focused on diversifying revenue streams to better serve Canadians which included expanding into financial services.
See: How Fintechs Are Tackling Financial Inclusion in Canada
In 2021, Canada Post partnered with TD to launch a personal loan pilot called 'MyMoney' but it was soon paused due to 'processing times' and then officially closed down with the reason being attributed to 'misuse by consumers' attempting to exploit the new offering.
Why This Partnership Matters
The postal network is trusted and offers a vast network of outlets across the country. For the 15% of Canadians who are underserved by traditional banking options, the KOHO partnership could be a key lifeline with modern financial tools to help them access and manage their money without relying on banking institutions. In a country as big as Canada where many communities are 'underserved' in some capacity, it simply makes great sense to combine financial technology with Canada Post's infrastructure for a win-win.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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How Fintechs Are Tackling Financial Inclusion in Canada
Financial Inclusion | Nov 4, 2024
Image: Freepik/jcomp
A Visual Journey Into Financial Inclusion - Breaking the Cycle
Chris Skinner’s recent article “Banks make millions from the most vulnerable” shines light on the struggles people face when trying to access financial services especially during tough times (like most countries are experiencing right now including Canada). There's a significant need for effort to make financial services more inclusive. Even in today’s connected world billions of people are left out of basic financial services, limiting their ability to find stable jobs or secure housing. Below are several videos that offer a closer look at this global issue and a look at how Canadian fintechs are helping to tackle the issue of creating a more inclusive financial system.
1. "Vicious Circle" (HSBC UK)
HSBC UK's “Vicious Circle” award winning video shows how not having a stable address can lock people out of basic banking, which is often needed to find jobs and secure housing. With programs like the No Fixed Address service, HSBC aims to change this, giving homeless individuals a way to open bank accounts even if they don’t have a permanent home. HSBCs brand received a 10% lift in positive brand affinity as a direct result of this campaign.
Key Message:
"Without a fixed address, it's impossible to open a bank account. And without a bank account, securing stable employment and housing becomes even harder. HSBC’s ‘No Fixed Address’ service is a step toward financial inclusion for all."
2. "What Is Financial Inclusion?" (The Wall Street Journal)
This video breaks down what financial inclusion means in simple terms. It points out the challenges faced by almost two billion people around the world who don’t have bank accounts. The video also shows how efforts to expand financial services are helping close these gaps especially for communities that often get left out.
Key Message:
"Financial inclusion means providing affordable financial services for everyone, especially those currently underserved by traditional banking systems."
3. "What is Financial Inclusion? | Short Film" (BRAC)
BRAC’s short film highlights the real life experiences of people affected by limited access to financial services. It shows how not having financial support can deeply impact their lives. The film points out how important it is to make financial services available to the 1.7 billion people around the world who still don’t have access to basic banking.
Key Message:
"When people are unbanked, their access to economic opportunity is severely limited. Financial inclusion is not just a service – it’s a pathway to empowerment.
4. "What is Financial Inclusion and Why is it Important?" (IMF Institute)
This IMF video talks about why it’s crucial for everyone to have access to financial services around the world. It shows how governments and global organizations can build systems that make it easier for people to escape poverty and improve the economy.
See: G20’s Vision for Financial Inclusion through Digital Public Infrastructure
"Financial inclusion is not only a matter of access; it’s a catalyst for development, enabling people to participate fully in the economy."
5. "Financial Inclusion, the Digital Divide, and the Future of Money" (TED Talk by Ajay Banga)
In this remote TEDx Talk, Ajay Banga looks at how digital financial tools can help close the gap between those who have access to financial services and those who don’t. He highlights how partnerships between the public and private sectors can open up digital economies making it easier for more people to join and benefit from financial services.
Key Message:
"Digital financial inclusion is our opportunity to bring everyone into the economy but it requires collaboration and commitment from both public and private sectors.
6. "Digital Financial Services and Financial Inclusion" (UN Capital Development Fund)
The UN Capital Development Fund shows how digital financial services can help create a fairer and more sustainable future. This video highlights how digital tools make it easier for people to access financial services and provide support for small businesses, women entrepreneurs, and rural communities.
Key Message:
"Digital financial services aren’t just about convenience; they’re a bridge to economic opportunity for marginalized communities."
How Canadian Fintechs Are Addressing the Challenges of Financial Inclusion
In Canada people without stable housing often face big challenges accessing basic banking services which makes it even harder to find a place to live or a steady job. Several Canadian fintech companies are working to close this gap by creating new ways to help those without a permanent address or regular income gain access to financial services or in other ways like access to credit scores and financial literacy, no fee accounts and more.
1. KOHO Offers Accessible Accounts Without a Fixed Address Requirement
Canadian fintech KOHO is offering a no-fee spending and savings account which helps financial inclusion by reducing barriers for individuals without stable housing. KOHO requires identity verification like government ID but does not require proof of a fixed address or employment status, making it accessible for individuals experiencing homelessness. This helps those without a permanent address to access basic financial activities helping them move towards stability.
2. Borrowell is Empowering Financial Literacy and Credit Access
Borrowell is providing free credit score monitoring and financial literacy resources to help individuals with limited financial access start building a financial profile. By understanding their credit score and financial health they are better equipped to apply for loans or other forms of support once they have stable income or housing.
3. Wealthsimple is Offering Simplified Banking Services with Supportive Policies
Wealthsimple provides easy to setup savings and investment accounts with good interest rates. Although a Canadian address is needed to get started, there’s no job requirement so it's accessible for people in flexible living situations.
See: So what is financial exclusion in the era of Open Finance?
They also offer helpful tools for managing money showing a commitment to making financial services simpler and more accessible for those who might otherwise be left out, along with financial education resources.
4. Neo Financial is Offering Digital Banking Solutions with No Monthly Fees
Neo Financial provides digital banking without monthly fees. Their easy to use platform is built to support a wide range of users especially those who might struggle with traditional banking. By making banking simpler and offering helpful financial tools, Neo aims to help people stay financially secure.
5. Payfare is Providing Financial Services to Gig Workers
Payfare works with gig economy companies to give financial support to gig workers who often can’t access regular banking services. By providing quick payments and simplified digital banking, Payfare helps lower the risk of financial struggles that could lead to homelessness.
Closing Outlook
These fintech companies are showing how technology can help overcome barriers to financial access by making essential services available to people facing homelessness and financial exclusion. By removing traditional banking hurdles such as high fees and strict requirements, they’re opening doors and moving Canada closer to a future where everyone has access to financial resources.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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