Over the past decade, Canada has witnessed significant advancements in digital banking, with both traditional banks and fintech startups investing heavily in digital solutions to meet customer demand for convenience, accessibility and enhanced banking experiences.

Today, this developed industry comprises a host of solutions encompassing online banking offerings provided by traditional banking institutions, digital banking spun-off outfits launched by incumbents, and digital banking solutions offered by private fintech startups.

Today, we look at some of the Canada’s top digital banking offerings to know. For this list, we’ve focused on homegrown digital challenger banks and digital banks that don’t use any existing legacy systems to operate.

Unlike regular online banks, these challenger banks don’t use any physical infrastructure or digital operating systems that are already being used by existing financial institutions, utilizing instead technology they’ve developed from scratch.

Koho Financial

Founded in 2014, Koho Financial is a Canadian fintech company that offers banking services, providing a comprehensive spending and savings account with no hidden fees that gives cash back on every purchase, and an integrated app that helps users spend smart and save more. While not a bank itself, Koho collaborates with various banks and federally regulated financial institutions to deliver its products, including Mastercard and Peoples Trust.

Koho’s products include Cover, an overdraft feature that gives users a buffer for everyday spending; Instant Pay, which allows users to access their pay daily, rather than bi-weekly; Earn Interest, a Koho spending and savings account that allows users to earn 1.2% interest; Credit Building, which allows users build their credit history by paying a monthly subscription; and the Koho Mastercard, which features no fees, high interest rates, and cash back.

Koho closed a C$210 million Series D funding round in February 2022, which the company said it would use to accelerate growth, expand into new product verticals, and increase the its headcount from 250 to 400. The company said in July 2022 that more than 650,000 Canadians had signed up to its service.

Neo Financial

Founded in 2019 and headquartered in Calgary, Neo Financial is a technology company that aims to simplify finances. Neo Financial collaborates with leading financial institutions including Mastercard, ATB Financial and Concentra Bank to offer customers secure solutions for spending (Neo Credit), saving (Neo Money), investing (Neo Invest), and obtaining mortgages (Neo Mortgage).

Neo Financial’s product line already boasts one million customers and includes the Neo Credit Card, a cash-back credit card issued by ATB Financial and backed by the Mastercard network, as well as the Neo high-interest savings account offered by Concentra Bank. The company also offers Neo Invest, which claims to be Canada’s first fully digital, actively managed investment vehicle

Neo Financial’s latest product, Neo Mortgage, matches customers to the best rate based on their personal situation, and allows them to apply directly for a mortgage online. The product, launched in May this year, connects customers with in-house, commission-free mortgage experts to provide unbiased support and advice along the process. The mortgage application is 100% digital and allows customers to get prequalified for a mortgage in as little as five minutes.

The company also provides a banking-as-a-service (BaaS) product called Neo for Business, which powers financial solutions for Intuit TurboTax, Hudson’s Bay, and over 10,000 other partners across the country.

Neo Financial closed a C$185 million Series C funding round in May 2022 that brought its valuation to more than C$1 billion, CTV News Calgary reported last year. The startup has secured almost C$300 million in funding so far.

Mogo

Founded in 2003 and based in Vancouver, Mogo offers various financial services such as loans, mortgages, identity fraud protection, and a digital spending account with an accompanying Mogo Visa Platinum Prepaid Card. The company went public on the Toronto Stock Exchange in 2015 and expanded its offerings to include mortgages in 2017 and acquired digital payments company Carta in 2021.

Mogo focuses on offering simple digital solutions to help customers build wealth and achieve financial freedom. Mogo’s trade app, MogoTrade, offers commission-free stock trading that helps users make a positive impact with every investment and together with Moka, Mogo’s wholly-owned subsidiary bringing automated, fully-managed flat-fee investing to Canadians, forms the heart of Mogo’s digital wealth platform.

Through Mogo’s wholly-owned subsidiary, Carta Worldwide, the company offers a digital payments platform that powers the next-generation card programs from innovative fintech companies in Europe and Canada. Mogo also offers digital loans and mortgages.

Mogo claims more than 2 million members, and is a prominent fintech company in Canada.

Moka

Moka, formerly known as Mylo, is a savings and investing app designed to help Canadians achieve their financial goals.

Founded in 2017 in Montreal, Moka provides a savings app that allows users to round up purchases from a linked debit or credit card and then puts the spare change into an investment account. In addition to the round-up feature, users can set automatic recurring investments so that their savings can grow even further. Moka’s portfolio manager invests customers’ money using a diversified portfolio of low-cost exchange traded funds (ETFs). Moka charges a flat fee of C$4.99 – C$15 per month, along with a small management fee for the portfolio.

Every Moka user is advised by a registered Canadian portfolio manager, Tactex Asset Management, Moka’s trusted partner. Tactex provides discretionary portfolio management for clients and currently manages over C$215 million in client assets.

Since its inception, the company has rebranded from Mylo to Moka and expanded to France. It has also developed new products powered by artificial intelligence (AI) and human expertise that accelerate debt repayment, provide financial coaching, and deliver valuable cashback rewards.

In May 2021, Moka was acquired by Mogo.

Wealthsimple

Founded in 2014 and headquartered in Toronto, Wealthsimple offers a suite of simple and sophisticated financial products. Wealthsimple isn’t a bank but provides a host of no-to-low-fee financial products, including Wealthsimple Invest, an automated investing service; Wealthsimple Trade, a self-directed investment platform; Wealthsimple Crypto, a service that allows customers to buy and sell cryptocurrencies; and Wealthsimple Tax, an all-in-one tax preparation and filing platform. Via Wealthsimple for Advisors and also for firms via Wealthsimple for Work, Wealthsimple combines a robo-advisor platform with access to live advisors.

Wealthsimple currently serves 3 million Canadians and holds over C$18 billion assets. The company is owned by Power Corporation indirectly at 42.5%.

Featured image credit: Edited from Freepik