Questrade gets approval to establish Canada’s newest bank

However, the company will not launch new products immediately. Holodenko said more details would be announced in the first half of next year, but they had not yet ruled out any categories. “We’re working hard to provide a full suite of services to Canadians.”

Fintech firms focus on credibility through regulation

The move comes as other fintech companies are stepping up their efforts into banking, including Wealthsimple Inc., which has been expanding its offerings into checking accounts, credit cards and mortgages as its assets under management have grown to more than $100 billion.

Wealthsimple has grown through partnerships, including deposit insurance with established banks, rather than obtaining its own license, as CEO Michael Katchen has said multiple times that he doesn’t think Canada needs another bank. But Holodenko said he believes a regulatory approach would help overcome some Canadians’ reluctance to abandon the Big Six banks that dominate the industry.

“We firmly believe that Canadians need stability and Canadians need to feel a sense of trust,” he said. “A banking license allows us to show Canadians that, 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 license adds to Cathay Securities’ already broad product portfolio, including trusts, wealth businesses, online brokerage businesses, as well as robo-advisory businesses and consumer loans, which total assets under management of more than US$85 billion.

“We already serve millions of Canadians,” Holodenko said. “We think we can do more for Canadians through banking.”

Spain’s Santander also received a license in April, but it has remained mum on any expansion plans. Koho Financial Inc. is also working to obtain a banking license.

Questrade received its banking license some 26 years after Kholodenko founded the company.

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