Canadian Fintech: National Bank is Cambodia's Largest Lender? 🇰🇭
Why all my favourite fintechs are being acquired by private equity. VoPay & Brim expand into the US.
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🤝 M&A
KKR, a US private equity group, has agreed to buy MDF Commerce, a Quebec based procurement software for $225m. Private equity takeovers in Canada have been popular over the last year as the IPO window remains shut.
National Bank is reportedly selling off its ownership in Cambodian based ABA Bank. For the record, National denies the report. But it begs a good question. Why does a Canadian bank own the largest lender in Cambodia? Well it’s actually kind of common:
CIBC has a huge presence in the Caribbean via First Caribbean.
RBC has made acquisitions across South America.
Scotia has bought banks in Greece, UK, Mexico, Uruguay, Colombia, & Curacao.
Sagard, the alternative asset manager owned by Power Corp (who also own stakes in Wealthsimple, Koho, Nesto & Borrowell) acquired 40% of HalseyPoint, a private debt manager.
Apple has acquired Waterloo based gen AI company Darwin. This isn’t their first Canadian acquisition.
Apple’s “tap to pay” feature comes from their purchase of Montreal based Mobeewave in 2020 for $135m.
TOGETHER WITH PAAYS
Identity fraud in mortgage and auto lending is on the rise in Canada. Fraudsters using increasingly sophisticated tools like Gen AI, are targeting large-ticket lending channels that have vulnerable processes and controls.
ID Verifier by Paays combines modern AI, Biometric, OCR and Liveness Detection technologies to deliver better identity verification processes with less fraud.
And the combination of ID Verifier with Paays Fraud Check, enables a robust modern fraud stack of multiple anti-fraud data sources, and the ability to defend against Gen AI.
🚀 Product
Synctera, a platform to help fintechs launch financial products launched Synctera Pay, a way for clients to integrate with any payment provider and have transactions reconcile with the Synctera ledger.
Think of this like the app store: Synctera is your iOS but you can keep using your preferred “push to card” or EFT app.
VoPay, a Vancouver based payment gateway has expanded into the US through a partnership with Cross River, a large sponsor bank.
Cross River gives VoPay access to US payment rails (ACH, RTP, and eventually FeNow).
Moka has relaunched their stock investing platform with a flat management of $7 / month, a very competitive option to other Canadian brokerages.
Moka originally launched as Mylo, an app that rounded up your purchases to the nearest dollar and invested the savings into ETFs.
Mogo, a Vancouver based lender acquired Moka in 2021 for $64m.
Brim, a Toronto based platform for banks to launch credit card programs has partnered with software implementation consultant TrueNorth to sell into US clients.
It is very common for enterprise fintech to partner with technology consulting firms. These firms can both act as a sales force and deliver a project after closing a sale. It’s a great way to scale.
⚖️ Policy
The NDP have proposed banning the use of Notice of Security Interests (NOSIs) used to secure HVAC loans against a property in Ontario.
Similar to home or auto financing, these liens are used to reduce the risk a lender takes on in order to provide a lower interest rate to the borrower.
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Have a great week! See ya 👋