Desjardins and Quebec’s pension plan manager launch fintech fund

The fund will target companies that develop tech affecting insurance and investments

Desjardins Group and Quebec’s public pension plan manager are teaming up to create an investment fund dedicated to funding financial technology (fintech) companies and artificial intelligence (AI) activities applied to finance.

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The fund, which is currently unnamed, will target companies that develop technology affecting insurance, investments, payments, client acquisition and retention, data analysis, security, deposits and loans. It is expected to have a maximum size of $75 million, with both Desjardins and la Caisse de dépôt et placement du Québec investing a combined total of $50 million.

Other institutional investors have already expressed interest in joining before the first closing, which is expected by the end of the year, according to a joint announcement released on Tuesday by Desjardins and la Caisse.

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“This new fund is very timely. Not even two weeks ago, the Brookfield Institute ranked Montreal in first place in Canada for its concentration of jobs in the high-tech sector,” said Guy Cormier, president and CEO of Desjardins Group, through a statement. “This support for FinTech will enable our financial sector companies to be world-class pioneers, particularly with regard to customer experience and competitiveness with the giants that are moving into our industry.”

Companies that are looking for funding will have to demonstrate that they employ experienced entrepreneurs; an adaptable business model; and a competitive product that is already generating interest and targets large markets.

Desjardins and la Caisse are expected to soon appoint a manager who understands the Canadian FinTech sector and the finance-related AI market. A technology advisory committee made up of information technology and finance sector leaders will also be created.

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