Technology is impacting just about every business sector today, especially finance. Dozens of so-called "fintech" start-ups have popped up in Canada in an attempt to take away market share from banks, brokerages, and traditional loan providers.
Many investors want to put their money to work in the new sector, but can’t find a way to do so easily. Here are three ideas.
The first is an investment in Canada’s only publicly-traded fintech company, Mogo Finance Technology Inc. (TSX:MOGO). Mogo started off making high-interest loans to risky borrowers, but has since expanded into the mortgage space, using digital advertising to reach potential borrowers. The plan seems to be working; shares are up 86% in the last six months as both its member base and revenue numbers soared.
The next is an investment in Power Financial Corp (TSX:PWF), which has large stakes in both Great-West Lifeco and IGM Financial. Power Financial is also the majority owner of WealthSimple, one of Canada’s new robo-advisors, a service that uses software to help investors choose a portfolio of low-cost ETFs. Keep in mind, however, that WealthSimple is only a small portion of Power Financial’s assets.
Finally, investors can take a look at Canada’s banks, which are collectively throwing billions of dollars towards high-tech solutions. Many folks exclusively use online banking, and wealth management divisions are increasingly moving towards digital communication options.
Many speculate getting a loan completely online will be next.
Unfortunately for most Canadian investors, the average person only has a few options. Most opportunities are limited to the professionals.
