Canadian Fintech: Koho gets back into lending 💸
Walnut embeds insurance with Propel. Airwallex launches card issuing. Wealthsimple expands CDIC coverage.
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For the first time since launching this newsletter, no public funding or m&a announcements this week 🙈.
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🚀 Product
Koho, a fintech for banking low income Canadians launched (brought back?) small dollar consumer loans. For a $2 / month fee, users receive $20 - $250 interest free.
Koho calls this product “Cover” but it is sometimes referred to as overdraft protection and carries interest when offered by banks. Borrowell launched and killed a version of this product in 2019.
In 2014 Koho also launched and later killed their first small dollar credit product called “Instant Pay” that allowed employees to access a portion of their weekly salary through a partnership with ADP. This model is called earned-wage-access and was popularized by Canadian fintechs Payfare and ZayZoon.
Airwallex, a cross border business banking platform partnered with Peoples Trust to issue multi-currency payment cards in Canada.
Similar to Float, Vault, & Loop, Airwallex offers FX, multi-currency accounts, accounting integrations and expense management.
The big difference is that Airwallex can also be white-labelled by third party fintechs.
Wealthsimple expanded their deposit insurance coverage to $500k per client by spreading consumer deposits across multiple CDIC institutions.
They increased their coverage from $100k (which is standard per institution) to $300k last year.
Nuvei, a Montreal based payments company launched invoicing financing.
This is a natural extension of business payment processing. Nuvei can see how long a payee’s receivables are typically outstanding for, so they can use this data to underwrite a cash advance.
Canadian payment competitors Lightspeed and Shopify offer similar products.
🚀 Product
Wilbur, a budgeting app that allows users to be paid for taking surveys launched.
Players locally (Billi Labs) and internationally (Mint) recently shut down personal finance management apps in Canada.
Wilbur is run by market research firm SquareKnot Analytics in Vancouver.
Walnut, an embedded insurance platform launched embedded creditor protection with Canadian lender Propel and insurer Trans Global.
I find Propel an interesting fintech to track because they both provide and receive embedded financial services:
Receive: embedded insurance via Walnut
Provide: lending via Pathward, a US banking-as-a-service bank
riskthinking.AI, a Toronto based climate risk data analytics company was selected by OSFI (federal regulator) & AMF (Quebec regulator) to standardize how FIs run climate risk scenarios.
For example, real-estate lenders & property insurers will be mandated to forecast their portfolio exposure to flooding as floodplains expand over the next 30 years.
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Have a great week! See ya 👋