Tangerine Bank is your not typical bank. A subsidiary of Scotiabank—which acquired it in 1997—Tangerine has no branches but is much more than just a website.
Tangerine is a Canadian direct bank, and it’s a renegade brand poised for Canada’s fintech explosion.
“Only 8.2 per cent of digitally active consumers in Canada have used at least two FinTech products within the last six months,” said Ernst & Young’s Gregory Smith, in the Financial Post. “This puts Canada behind five other countries surveyed, including the U.S. and the U.K. As the trend continues to catch on, traditional financial services companies will have to be much more aggressive and creative to keep their customers. A big piece of the customer pie will be at stake here.”
“All the banks in Canada are thinking about fintech,” says Tangerine Chief Executive Officer Peter Aceto. “As a challenger brand, we need to work hard to be faster and be nimbler and try and keep ourselves a step ahead.”
The bank was the first in Canada to allow check deposits by taking photos with mobile phones in 2013, and to use fingerprint scanning and voice-enabled banking, reports Bloomberg. Tangerine is now delving deeper into such biometric technology—including the possibility of facial recognition—to improve customer experience and security.
Sean O’Connor, VP partnerships at Grow, a fintech lender formerly known as Grouplend, thinks the trend is gaining traction to court younger, mobile-first, tech-savvy customers. “In some cases, this may mean cannibalizing areas of their core businesses in order to keep up in the technology arms race,” he said, adding that for now, Canadian fintech is more “evolutionary than revolutionary.”
“To be competitive in the market with large and well-heeled banks or attractive from a partnership perspective,” said O’Connor, “truly game-changing products will need to be delivered.”
Tangerine fits the bill, having just launched a new fintech incubator with Ryerson University for Canadian startups.
Companies in the incubator so far are Digital Retail Apps, whose SelfPay lets customers scan and pay for items via smartphone, and Curexe, a web app for international payment and currency exchange for small businesses. Two job search-focused platforms, WhoPlusYou and CareerJSM, are also part of the incubator.
“We always want to provide Canadians with experiences that they didn’t even know they wanted,” said Tangerine’s chief strategy officer Brenda Rideout. “We haven’t necessarily said [to startups] this has to be exactly where it fits, nor do we want to put those boundaries on innovation. The idea is that we’re supporting local startups and community.”