Canada’s financial technology ventures are poised for major growth, both among industry heavyweights such as Shopify (recently valued at $1.27 billion), Verafin, and Lightspeed Retail, and within a growing group of startups making strides in the “fintech” sector. Ali Pourdad, CEO of Progressa, and a BCIC-New Ventures Competition sponsor, comments on the fintech space and how accessing big data is fuelling their business.

From cyber security to e-commerce

Financial technology has gained recognition for helping to advance the traditional banking archetypes beyond the traditional “Big Five” structure dominant in Canada, and having done so largely through a collective industry commitment to the pursuit of digital innovation.

According to the Britsh Columbia Technology Industry Association (BCTIA), 29 fintech ventures have launched in B.C., 24 of which launched in just the past five years. This puts B.C. among the top provinces for fintech growth, second only to Ontario.

The expanding fintech space is innovating in a wide-range of applications and industries. Services include everything from fraud detection and cybersecurity, to contactless payment technology & ecommerce, crypto-currency (digital currencies such as Bitcoin that are designed for safe and rapid payment transfers), lending, and even robo-advisors, platforms that use specialized algorithms to grow and make recommendations for their customers’ portfolios.

Using big data to make informed financing decisions

Every day, consumers are openly sharing thousands of data points across hundreds of valuable metrics, largely driven through their use of mobile commerce and social media. This information is the crux of “big data,” a movement aimed at improving quality of business operations through the interpretation of new and unorthodox data sources. Fintech innovation uses these data to allow firms to engage their customers in ways that go beyond traditional service models, and to create more personalized and efficient workflow for their businesses and  regardless of their specific niche.

Many financing-focused fintech companies, such as Progressa, are coupling big data with traditional credit score information in order to minimize lending risk and increase the range of customers that can be served with effective and affordable loans. By assessing data such as spending habits, job stability, and more, fintech companies are able to serve qualified loan applicants that a bank could not, based solely on a credit score.

Embracing a socially responsible mandate

In addition to the use of data innovation to improve the business viability of alternative lending, Progressa is among the first fintech firms to use the power of data collection to make a tangible and immediate difference in financial health and quality of life for its population of borrowers.

This socially responsible approach to using data is at the core of many fintech mandates. As startups mature, they will no doubt shift from service-focused paradigms to ones that champion social responsibility. At Progressa, this means paying past due bills directly for its customers, which immediately frees them from the pressures of collections requests and mounting interest from unpaid bills.

Socially responsible use of data is not limited to the lending sector. Tech startups of all kinds can innovate beyond their services by embracing different types of socially responsible mandates. Social responsibility is part of the appeal that has driven growth among successful fintech enterprises – for example, robo-advisor Wealthsimple has grown its appeal within the data-rich and socially conscious millennial demographic by offering a portfolio option that includes companies with lengthy and positive track records for environmental standards, transparent governance and ethical practices.

Financial customers are seeking out greater transparency, more affordability, and more integration with their digitally connected and socially conscious lifestyles. The industry needs to evolve to provide the right solutions. It will do this through the intelligent use of data, not only to stimulate its own growth and profitability, but to improve the awareness and quality of life of its customers in the long term.

About the author

Ali Pourdad

Ali Pourdad has been Chief Executive Officer of Progressa (formerly Creditloans Canada Financing) since its inception in 2013. Born and raised in Vancouver, BC, Ali holds a Canadian Chartered Accountant degree and a BBA in Finance from Simon Fraser University. Ali has decisively positioned Progressa for its next generation of growth by recently executing on several initiatives, including securing an $11.4 million Series A financing. Under Ali’s leadership, Progressa has successfully raised over $20.0 million of investor capital, invested over $2,000,000 in its proprietary lending technologies, and grown to over 70 employees in Vancouver and Toronto.

Prior to being appointed CEO, Ali was a corporate insolvency and restructuring manager at a boutique advisory firm, where he operated, restructured, and sold a number of public and private companies under court appointment. Ali was a lead auditor with PricewaterhouseCoopers LLP, where he managed top-tier engagements of financial firms including JP Morgan Asset Management Fund and Phillips, Hager & North. Ali began his professional career at a young age, co-founding a leading IT services firm in Edmonton, AB and Vancouver, BC, in 1998, which grew to 30 employees. Ali exited the venture in 2005.

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To learn more about Progressa, visit www.progressa.com