Toronto Dominion (TD) has launched what it says is a unique programme to support young fintechs and start-ups in their patent applications.
TD has earmarked C$3.25m from its fintech investment pool to provide patent application funding and expertise specifically to new ventures.
The goal is to help high-potential early stage ventures secure their intellectual property rights and enable them to stay focused on rapid growth and innovation.
TD is the first bank in North America to offer a non-equity based programme specifically supporting the patent application process for early financial sector start-up ventures.
The initiative builds on TD’s commitment to build strategic relationships with fintechs ranging in size from seed stage start-ups to more established companies that have received past rounds of funding.
TD has already made a number of investments in companies that are positioned to lead the development of next generation financial solutions.
“The success of young, innovative start-ups is key to Canada’s future, and to TD’s,” said Colleen Johnston, group head, direct channels, technology, marketing and corporate & public affairs, TD Bank Group.
“TD is building the bank of the future, and strong relationships with leading technology and fintech companies provide us with enormous insights while fueling our own creativity and innovation. Ultimately, the customer wins when banks and fintechs collaborate.”
A study entitled ‘The Bright Side of Patents’ from the US Patent and Trademark Office last year found that start-ups that are able to secure patent rights to their ideas were more likely to succeed with greater revenues, more staff and financing opportunities than start-ups who did not secure patent rights.
While Canada has witnessed growing numbers of its citizens using financial technology in the past year, it continues to lag behind many of its international peers.
In Canada, only 18% of digitally active Canadians have used two or more fintech services in the past six months, compared with 33% per cent globally, according to EY’s FinTech Adoption index.
By contrast, comparable figures for the UK, Australia and Germany were 42%, 35% and 35% respectively; even across the border in the US the figure of 33% is almost double the Canadian figure.
Appetite for fintech investment is high at TD’s rivals; in June RBC acquired Wiser Investments, a Toronto-based financial-technology firm, and launched its own innovation lab together with its asset management division, RBC Global Asset Management.
Scotiabank has partnered with Kabbage and CIBC has teamed up with Thinking Capital Inc. for online small-business loans.
Canada-based fintechs secured $368m in venture capital funding in 2016; 32 of the most innovative local start-ups have been selected to exhibit at the annual Sibos gathering in Toronto in mid-October.