The world of banking is undergoing a revolution. Boutique credit unions have been eroding Canada’s Big Five customer base for years. That erosion was accelerated by the 2008 financial crisis, which raised consumer mistrust of major financial institutions to an all-time high.
Meanwhile smartphone apps are offering new business and finance delivery models from mobile devices at an exponentially faster rate.
Samson Lim, executive vice-president and chief financial officer for the Peoples Trust Co., a Vancouver-based boutique financial services company, said the rise of “fintech” (financial technology) companies is driving this growing movement.
Offering the delivery of banking services in a completely new way, they’re attracting customers who were already searching for new forms of financial services.
“We’re seeing the cutting edge and a new wave that’s probably going to be developing in the next five to 10 years,” said Lim.
He added that the entire fintech sector, in which “everyone goes on their smartphone and gets a loan there or makes payments there, instead of walking into a bank, is growing.”
“The only time you will walk into a bank is if something goes wrong, and you won’t need a credit card anymore. It will all be done through your phone.”
Peoples Trust has already signed on with Koho, a smartphone and web app that allows users to make direct deposits, bill payments and money transfers for free as well as giving them access to built-in budgeting tools.
He said Metro Vancouver is a hot spot for the new banking movement.
“Vancouver is quite the fintech capital of Canada. A higher-than-average proportion of these new companies … are headquartered here, as kind of the tech startup capital of Canada.”
According to a recent Canadian Bankers Association study, 55% of Canadians now use online as their main form of banking; in 2000 that number was 8%.
Mobile banking is also on the rise: according to the study, 31% of Canadians said they used their smartphones for a financial transaction in the last year, up from 5% in 2010.
Coinciding with that increase is a drop in “branch” banking, as only 13% of Canadians now use it as their preferred method of completing financial transactions, down from 29% in 2000.
Lim said what will emerge is a new style of banking where customers will choose services from a financial buffet.
“It will be more individualized and personalized, and you and your neighbour will get different offers. If you want a small loan to do some renovations, you just go on your smartphone, type in a few objectives and you’ll get a bunch of offers coming back and they’ll be personalized. And it will also immediately search all of your background, so a little scary as well.”
Rather than opposing the new banking trend, Lim, a former Citizens Bank of Canada chief financial officer, has embraced it.
Bill Moffatt, president and chief operations officer for Peoples Trust, said it’s part of the reason the company hired him four years ago.
“I admire Samson for his adaptation of cutting-edge accounting strategies that have been very beneficial for our business,” said Moffatt.
Lim is also a former associate vice-president of finance for Vancity and held numerous leadership roles at Telus (TSX:T).
Paul Challinor, a partner with PwC who’s worked with Lim, said he’s simply “a guy you’d want to have on your team.”
“Samson brings a high level of intellect to the role of CFO, and he has the ability to cut through the detail of technical accounting standards and see the real impact of new accounting and reporting requirements.”
But Lim’s expertise doesn’t end there.
Aside from being a forward-thinking CFO for a growing boutique financial services company, Lim is also a serious film fan, Moffatt said.
“If I need a movie review, new or old, he is who I turn to. He has an amazing catalogue of knowledge of diverse genres. I would also not want to be up against him in Trivial Pursuit.”
So is Lim’s favourite movie about the banking sector or emerging technology?
“Well, I actually love the old Star Wars movies more than anything,” he said. “Not so much as, say, The Big Short. I’m a pretty big sci-fi guy, so maybe banking in space, when that comes out I’ll change my pick.”
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