Questrade Secures Approval to Launch Canada’s Newest Bank

Canadians will soon have another banking option after Questrade Financial Group announced it has received regulatory approval to launch Questbank. The online broker said Monday that the Office of the Superintendent of Financial Institutions granted the final approval, clearing the way for Questbank to operate as a federally regulated bank in Canada. “We’re Canada’s newest bank today,” Questrade chief executive Edward Kholodenko said. “So Happy Birthday to Questbank.”

Questrade is not planning an immediate, full-scale rollout of new products. Kholodenko said the company will share more details during the first half of next year about the specific services and accounts Questbank will offer. While the exact product lineup has not been finalized, he indicated the organization is pursuing a comprehensive approach: “We’re working toward a full suite of services for Canadians.”

Fintechs eye credibility through regulation

The move to obtain a banking licence reflects a broader trend among financial technology companies seeking to bolster credibility by becoming regulated banks. Competing fintechs have expanded into traditional banking product areas—chequing accounts, credit cards and mortgages—either through partnerships with established banks or by pursuing their own licences. Wealthsimple Inc., for example, has grown its product range in part through partnerships with chartered banks, relying on those partners for deposit insurance rather than holding its own banking licence.

Questrade’s leadership says that holding a banking licence can help overcome the natural reluctance some Canadians feel about switching from the Big Six banks that dominate the market. Kholodenko framed the licence as a trust-building measure: “We firmly believe that Canadians need stability, and Canadians need to feel a sense of trust. A banking licence gives us that capability to be able to show Canadians, hey, you know, this is a properly regulated entity, and you can trust us with your life savings.”

Questrade expands its growing financial empire

The new banking licence complements Questrade’s existing range of businesses. The company already operates a trust, a wealth-management arm, an online brokerage, a robo-advisory service and consumer lending operations. Collectively, those services amount to more than $85 billion in assets under administration, and Questrade says it serves millions of Canadians through these channels.

Adding Questbank is positioned as a natural extension of the company’s current offerings, allowing Questrade to integrate banking products with its investment and wealth solutions. This could create a more unified financial experience for customers who already use the firm’s brokerage and advisory services, although specific product and service details will be announced later.

Other recent entrants into the Canadian banking landscape include global banks and digital challengers. For instance, Spanish bank Santander secured a licence in April but has not publicly detailed expansion plans, while Koho Financial Inc. is also reported to be pursuing a banking licence of its own. These moves illustrate growing competition and diversification in Canadian financial services, driven by both established incumbents and agile fintech firms.

Questrade’s path to a regulated bank comes roughly 26 years after Edward Kholodenko founded the company. Over that time, the firm has built a reputation as an online brokerage and wealth services provider, and the new licence marks a significant milestone in its evolution.

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What this approval means for consumers will depend on the specific accounts, fees, protections and service delivery Questbank ultimately chooses to provide. For Canadians interested in alternatives to traditional banks, the arrival of a new federally regulated bank from a well-known online brokerage will be worth watching as the company details its product roadmap in the coming months.