A look at the Toronto region’s global potential for fintech and financial services based on the findings of our recent report, commissioned by the TFSA.

I was very pleased to speak at the recent Redefining Global Financial Centres in a Fintech Era symposium, held on May 15 and hosted by the Toronto Region Board of Trade in partnership with the Toronto Financial Services Alliance (TFSA) and Ontario Centres of Excellence (OCE).

The symposium explored how global financial centers can effectively position themselves to respond to the impact of fintech, and the development and adoption of new regulatory frameworks that protect and enable consumers, financial institutions and fintech companies in an evolving innovation ecosystem. I presented our work for the TFSA on the current state of fintech in the Toronto region, and offered recommendations for how to ensure the region can compete alongside some tough and accomplished global players.

Here in Ontario, the vast majority of companies active in the fintech space operate in the Toronto/Kitchener-Waterloo corridor, what we refer to broadly as the Toronto region. They benefit from:

  • An established core of strong financial institutions.
  • Top-tier research facilities at local academic institutions.
  • A strong talent base.
  • Relatively low business operating costs compared to other global fintech ecosystems.




It’s fair to say that the Toronto region has a number of strengths. But that’s not the whole picture. Around the world, other established and emerging fintech hubs are moving more aggressively to seize a global leadership position.

Companies in the United Kingdom and Singapore, for example, benefit from a clearly mandated office dedicated to supporting and growing the fintech ecosystem. New York has an especially attractive investment climate, while the Silicon Valley has an unparalleled and historic advantage in fostering generations of entrepreneurs and investors.

The hard reality is that the Toronto region ranks at best among the middle of the pack in a race that is heating up. Three regions—Silicon Valley, New York and London—have a large lead. But the gap can be closed. The challenge is: Can we create the conditions that will drive Toronto’s ultimate success in attaining a lead position?

Our recent report, commissioned by the TFSA, provides a range of recommendations to help us break out of the pack and close the gap in this race. I’ll focus on five key takeaways:


Closer and more frequent engagement is needed between fintech startups, well-established financial institutions and the venture capital community. In our survey of leading fintech hubs around the world, we found a strong connection between growth and innovation, on one hand, and a spirit of collaboration between fintechs, venture capital and established firms on the other. Cooperation works better than conflict as a business strategy.


Over the past five years, about 140 local fintech firms raised more than $500 million in equity financings. That’s in addition to financings that have been done privately. Right now, we aren’t attracting enough of the sophisticated seed-level funders that can help guide founders through the early stages of their companies’ development.

We want our fintech companies to be founded and developed here, to grow here and to cast a net out into the world from a base in Ontario. Therefore, we need to ensure that our tax policy and other rules encourage investment in our emerging fintech firms—so they can grow here and stay here.


A flexible and responsive regulatory environment is essential for fintechs to thrive. But right now, navigating the regulatory maze can be expensive and time consuming, and it can act as a significant barrier to entry.

There will always be a role for regulators to play in protecting consumers and investors, and safeguarding the system as a whole. But many in the industry believe that regulators should also play a role in encouraging or at the very least facilitating innovation. It’s all about balance. Intelligent and responsive regulation can act as a catalyst for change and growth.


In its recent budget, the federal government said it would invest close to $1 billion in what it describes as “innovation superclusters” across a number of industries. That’s a good first step in supporting research with commercial applications and building stronger connections among businesses, post-secondary schools and research institutions.

But greater support needs to be directed to the fintech space. We live in an area that’s abundant in top-tier academic institutions with world-class minds. We need to make more of that advantage by aggressively funding their work—and ultimately benefit from the companies and jobs that are created.


The fintech industry and policy makers must create the opportunities and conditions that will attract top talent with experience in growing and scaling fintech companies. Our challenge is not creating talent—we have excellent schools and smart young men and women—it’s creating the kind of opportunities that will convince our very best to stay here in Canada, whether they work with a fintech or with an established financial institution, helping them to adapt and innovate.  Too many of our best minds are being lured south by more attractive opportunities, higher pay and lower taxes.

We also fall short when it comes to attracting senior global talent to our local market—the kind of experienced leaders who can help fintechs scale from, say, $5 million to $50 million a year in revenue. This might help to explain why none of our Tier 1 fintechs are true global players. They’re just not big enough and in some cases they lack the leadership required to take that next big step.

The Canadian financial system is touted as one of the strongest in the world. Fintech can and is already changing the game. It’s time now to create the conditions for our fintechs to grow and thrive. And to ensure the Canadian financial system stays strong.

My thanks go out to Vikas Shreedhar and his team for their work on this report, and to TFSA for commissioning the report.

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