Koho Financial is moving towards potentially obtaining a banking license and the company’s CEO believes it could increase competition in Canada’s banking sector.

Last week, Bloomberg News reported that fintech firm KOHO will apply for a banking license with the Office of the Superintendent of Financial Institutions (OSFI) in a bid to become a Schedule 1 bank. It also plans to offer prepaid cards and lending services.

Daniel Eberhard, founder and CEO of Koho Financial, told BNN Bloomberg that the company can serve a “specific need” in Canada’s banking sector and “having a banking licensee is a big part of our ability to do so.” 

“I think there is historically been a myth that somehow competition and systemic stability are opposing forces. I think that the inverse of that is true,” Eberhard said. 

Koho has until now offered products including savings accounts, virtual credit cards and lines of credit, working with Mastercard and Peoples Bank of Canada.

With files from Bloomberg News.

To watch the full interview with Eberhard, click on the video at the top of this article.