Q1 | Torys QuarterlyWinter 2024

Seizing fintech’s potential: Q&A with Andrew Graham


  • Andrew Graham, Co-founder and CEO, Borrowell

Read commentary from our lawyers for the latest legal and industry trends in our article “The future of payments in Canada: are we finally making progress?” And for more industry insights, read our in-depth Q&A featuring Alex Vronces, Executive Director, Fintechs Canada.

What proposed legislation within the fintech space are you most excited about?

We are very much looking forward to the proposed legislation for consumer-driven banking. There has been significant effort from stakeholders to come up with a framework that is made-in-Canada—that is, one that recognizes the unique landscape of the Canadian financial services and the importance of collaboration between the government and industry.

[I]f a new financial app handling customer money doesn’t work properly or isn’t secure, that can be disastrous. You won’t get a second chance. So there’s tension in fintech between quick iteration and careful building.

It’s clear that consumer-driven banking will drive innovation and bring value to Canadians through better financial products and services. That said, there will be many details that need to be sorted out—accreditation, common rules, and technical standards.

The bottom line, though, is that consumer-driven banking will help consumers and small businesses by providing access to new and innovative services and spurring competition. One example of the need for consumer-driven banking can be found in Borrowell’s Rent Advantage service. It allows consumers to report rent payments to Equifax, thereby building credit history. And renters should have the right to do this—after all, renters have credit scores, on average, 100 points lower than homeowners. Rent Advantage will work better when consumer-driven banking is in force by making it easier for users to share their rent payment data. Today, the only way to do this is with screen scraping, an old and unreliable technology that consumer-driven banking will replace.

What does Canada need to do to catch up to other G7 countries?

Canada has a vibrant fintech sector, with many successful companies at various stages of growth. That said, Canadian fintech companies could be enjoying even more success on the global stage. After all, Canada has strong banks, insurance companies and pension funds—and our tech fundamentals are strong.

To live up to this potential, we need a conducive policy environment. Take the U.K. That country has built a world-leading fintech ecosystem with, according to EY, the strongest policy support of any government it studied. Successive U.K. governments have boosted the sector, encouraging competition, investment, and appropriate regulation. Open banking has been in force for years.

Across all these measures, we can and should do better in Canada. I’m encouraged by the announcement in the Fall 2023 Economic Statement that Canada will be implementing consumer-driven banking–Canada’s version of open banking—but we should acknowledge that we’re playing catch up.

How have you seen the startup ecosystem in general change over the years?

The startup ecosystem in Canada has matured in many ways since nearly a decade ago. Take capital. It used to be the case that being based in Canada was a disadvantage. Raising a funding round meant trekking south of the border to meet investors and, in many cases, have them encourage the company to fully decamp to the U.S. Now, Canada is on the map; foreign investors regularly invest here, and the pressure to move south has diminished.

Talent availability is also better. It used to be that, when a Canadian company reached a certain scale, it would have to look to the U.S. to find executives with experience at the next stage of scale. More and more, there are experienced leaders in Canada who have “been there, done that” and are ready to help a new Canadian company scale.

What advice would you give to founders who are building startups and thinking about entering the space?

I regularly meet founders who are looking to build fintech companies. Some of what I advise them holds for any new company: listen to your customers and work to solve real problems in their lives or businesses. Experiment as quickly and inexpensively as you can since your job is to learn quickly and iterate. Find one or more co-founders, as it can be a hard and lonely journey that’s harder to do if alone.

For fintech founders, I tell them that the bar for releasing products is in many ways higher. If, say, a new video game is buggy, that’s not great. But if a new financial app that’s handling customer money doesn’t work properly or isn’t secure, that can be disastrous. You won’t get a second chance. So, there’s tension in fintech between quick iteration and careful building.

Andrew Graham is co-founder and CEO of Borrowell, one of Canada’s largest financial technology companies, with over three million users. Borrowell helps consumers find financial prosperity and make great decisions about their money. It was the first company in Canada to offer credit scores for free and to allow consumers to report rent payments to Equifax in order to build credit history. Today, Borrowell offers products and recommendations across a consumer's financial journey.

Borrowell has won numerous awards, including being named one of the top 100 fintech companies in the world by KPMG, one of the fifty fastest growing technology companies in Canada by Deloitte and top 50 “Best Workplaces in Canada” two years in a row.

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This publication is a general discussion of certain legal and related developments and should not be relied upon as legal advice. If you require legal advice, we would be pleased to discuss the issues in this publication with you, in the context of your particular circumstances.

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