Nearly half of Canadians use online or challenger banks, as support for digital money movement strengthens.
New research from the CPPO, the nonprofit organization fueling the growth of the $14 billion open-loop prepaid economy, shows Canadians are expanding how they manage, move, and grow their money by combining traditional and digital-first providers that better align with their lifestyles.
The shift reflects a significant growth in Canada’s fintech sector. As consumers look for more personalized, digital-first financial tools, the Canadian fintech market is projected to reach $18.84 billion by 2033, showing the pace of innovation across payments, banking and embedded financial services. The research suggests that growth is being reinforced by consumers who are more cost-conscious and more focused on day-to-day money management.
The research findings identify a clear rise in “multi-banking,” with 47% of Canadians using online or challenger banks and 41% having relationships with both traditional and digital providers. Those who use digital banks increase to 52% among consumers between 18-64. Canadians cite practical benefits as primary motivators for using neobanks, including lower fees or better rates (42%) and stronger mobile experiences (29%). Similarly, 48% said they prefer financial apps that help them budget and manage money better.
In parallel, Canadians want public-sector payments to reflect how they already transact. Nearly seven in ten (69%) believe governments should stop mailing cheques and modernize payment and disbursement methods, with 81% citing direct deposit as their preferred way to receive government payments. Respondents see modernization as an opportunity to improve efficiency, equity, and accessibility.
“As Canadians create a multi-banked lifestyle, prepaid technology has emerged as the underlying infrastructure making it possible,” said Jennifer Tramontana, the CPPO’s Executive Director. “Consumers are building a financial system that works for them by choosing tools that prioritize convenience, lower costs, and stronger money management. The opportunity now is to keep momentum going by supporting the right environment for Canada’s fintech builders to keep improving these products for Canadians.”
Key findings from the research include:
- Economic pressure is shaping financial behavior: 80% say better money management tools are important given economic uncertainty, and 75% say avoiding banking fees has become more important over the past year.
- Canadians are dialing back reliance on credit: 44% are actively trying to use their credit card less for everyday purchases.
- Younger Canadians are leading adoption: Adults aged 18–34 are more likely to increase reloadable prepaid usage compared to older Canadians.
- Consumers strongly support prepaid’s practical value for consumers managing finances:
- Among prepaid users, 45% identify spending limits or budgeting tools as the most helpful feature
- 40% cite convenience as their primary reason for use, 39% cite the ability to set spending limits, and 33% cite security
- 44% prefer prepaid cards over credit or debit for online shopping
A public version of the release is available at cppo.ca.
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