Canadians should soon have a new banking option as Questrade Financial Group says it has secured regulatory approval to launch Questbank. The company, known for its online trading platform, said Monday it received the final go-ahead from the Office of the Superintendent of Financial Institutions. “We’re Canada’s newest bank today,” Questrade chief executive Edward Kholodenko said. “So Happy Birthday to Questbank.”
The company, however, won’t be rolling out new offerings immediately. Kholodenko said more details will be coming in the first half of next year on what’s in store, but that they haven’t ruled any categories out yet. “We’re working toward a full suite of services for Canadians.”
Fintechs eye credibility through regulation
The move comes as other fintech companies also push more into the banking space, including Wealthsimple Inc. which has been expanding its offerings into chequing accounts, credit cards, and mortgages as its assets under administration have grown to more than $100 billion.
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Wealthsimple has grown through partnerships, including with established banks to provide deposit insurance, rather than securing its own licence, as chief executive Michael Katchen has said many times he doesn’t believe that Canada needs another bank. But Kholodenko said he thinks going the regulatory route will help overcome the reluctance some Canadians have to switching away from the Big Six banks that dominate the sector.
“We firmly believe that Canadians need stability, and Canadians need to feel a sense of trust,” he said. “A banking licence gives us that capability to be able to show Canadians, hey, you know, this is a properly regulated entity, and you can trust us with your life savings.”
Questrade expands its growing financial empire
The banking licence adds to the broad suite of offerings Questrade already has, including a trust, a wealth business, an online brokerage business, as well as its robo-advisory business and consumer loans, that together count over $85 billion in assets under administration.
“We already serve millions of Canadians,” Kholodenko said. “And we think that we can do much more for Canadians with a banking offering.”
In April, Spanish bank Santander also secured a licence, but it has been quiet about any expansion plans. Koho Financial Inc. is also working toward securing a bank licence.
Questrade’s banking license comes some 26 years after Kholodenko launched the company.
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