Fintech in the US & Canada Whitepaper
August 20, 2021 Brandon Waselnuk 6 min read
Hi 👋🏼, we're so glad you're here :)Feature Photo by Nathan Dumlao on Unsplash
Below you'll find a link to download the entire whitepaper, no email required, just get it and enjoy this long read that highlights: how at the founding of our nations we set precedent for how our capital markets and systems still run today, modern Fintech companies case studies on their success and tactics, and there's even a reference to a rather famous musical. If you build in Fintech or are curious about it, you will get value out of reading this:
I'll also post a couple excerpts from the whitepaper in case I haven't convinced you to grab the pdf yet (seriously, you can just download it - there's no catch 😆)
Excerpt - Intro Letter from Brandon, CEO of Dignified
The finance and technology industries have been critical pillars throughout the entire history of Canada and the United States of America. Technology has been responsible for multiple exponential periods of growth, from the lightbulb and Model T to our current internet era. Finance has been there every step of the way, supporting unprecedented growth, keeping countries stable, and ultimately providing regulation and oversight.
Those very same forces of innovation are at play within finance itself — and always have been. Fintech isn’t new to 2021, as you’ll see. But the current opportunities are innumerable for those paying attention. It’s no wonder that entrepreneurs, governments, makers, and investors are fiercely trying to take part in the creation of new fintech companies, regulations that properly and thoughtfully govern these technologies, and innovations that unleash better access and financial futures for consumers.
I’m proud to present our research into the history of fintech, where we are today, and the distinct possibilities for those brave enough to take a risk making new things for tomorrow.
History informs our future. I know you’ll enjoy hearing about how decisions made in the 1800s still dictate how banks are run today just as much as you will like our interviews with leading companies and entrepreneurs at the forefront of fintech.
We love misfits at Dignified. As you’ll see, it’s often those at the fringes who drive innovation for our communities and the wider world. I can’t wait to see what you build next. - Brandon
Excerpt - Overview: Fintech in Canada Right Now
“Living next to you is in some ways like sleeping with an elephant. No matter how friendly and even-tempered the beast, one is affected by every twitch and grunt.” –Prime Minister Pierre Trudeau, on relations between Canada and the U.S.; National Press Club, Washington, DC, 25 March 1969
As illustrated by this quote from Pierre Trudeau, everyday life in Canada has long been influenced by the actions and temperament of the United States.
Although our proximity generally breeds contentment, it can be frustrating for consumers to see shiny new innovations just out of reach.
“Realistically, five years ago, the landscape was so different, and I didn't really get that at the time. When I started my blog, I was not in the world of personal finance,” says Odjick.
“So much of the financial media that I was reading in the blog landscape was based in the States,” says Odjick. “It is a bigger market. There just are more bloggers and more fintech companies.”
There are 5 more sections to this part including; Old Hat, New Toque / Early Adopter / Canada: Trust / Challengers Are Still Second Banana / Government Is Paying Attention.
Excerpt - The Future of Fintech in the U.S.
Regulatory Changes in the U.S.: Special Purpose Banking Charters
Despite regular and incredibly serious economic calamities in the U.S., the rounds of regulatory updates made in response to these events have not been sufficient to reinforce the structural gaps in the dual banking structure. Even after the Great Depression, sweeping reforms did not “eliminate the state and local banks that had been the source of so much of the problem” (Bordo et al. 18).
Although these same reforms introduced deposit insurance and other safeguards still in use today, “the fundamental weaknesses in the system, the multiplicity of small banks, and the multiplicity of agencies chartering and regulating banks, persisted. Indeed, the tendency in the legislation was to divide the banking system rather than consolidate it” (Bordo et al. 18).
The Dodd–Frank Wall Street Reform and Consumer Protection Act, which was signed into law by President Barack Obama in 2010 (and partially repealed by President Donald Trump in May of 2018) (Lane) is one example of how the foundational weaknesses of the U.S. banking system have contemporary repercussions. These kinds of piecemeal solutions can’t solve structural problems deep in the system.
However, it is exactly this same system, with its byzantine regulatory framework split between state and federal regulators, that allows so many fintechs in the U.S. to partner with small banks to provide innovative services. As [Jonah Crane] says, the U.S. has made progress in fintech “in spite of the lack of regulatory framework for fintech.”
However the regulatory mood is shifting slightly as regulators try to figure out who should be in charge of fintech regulation, evidenced by the Office of the Comptroller of the Currency’s special purpose national bank (SPNB) charters for fintechs.
There are 5 more sections to this part including: Regulatory Changes in the U.S.: Special Purpose Banking Charters / Special Purpose National Bank Charters for Fintech Companies / Hello, Federally Chartered Fintech / The (Foreseeable) Future of U.S. Fintech is ‘Banking as a Service’ / Don’t Count Community Banks Out
Start Reading :)
So, grab the whitepaper and a coffee / tea / yerba mate and enjoy this ride through history, present Fintech, and where the future just might be headed.