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Sensor Tower · Seema Shah · January 2024
Canadian Banks Benefit from Financial Squeeze
As customers became increasingly cost-conscious and focused on saving in 2023, Canadian bank apps experienced download growth, up an average of 7% YoY (ex-CIBC), while MAUs remained relatively flat. Smaller, digital-only banks advertised high yield savings accounts to attract cash-strapped customers and saw MAUs increase 4% YoY across the neobank cohort, indicating that consumers could be looking into newer lending options to help save money.
Key Takeaways:
Per Sensor Tower estimates, MAUs in Canada across the country's top 5 largest banks declined an average of -3% in 2H23 vs 1H23, with the exception of CIBC, which saw positive growth in 4Q23. CIBC’s modest decline in MAUs in 3Q23 (-1% YoY) arrived after multiple quarters of sustained growth, as MAUs surged an average of 25% YoY since 1Q22
The TD Bank app experienced significant organic adoption throughout 2023, with downloads from organic sources standing at 90% in Nov'23 vs 82% in 2022. During the same period, Bank of Montreal and CIBC also experienced material growth in organic downloads, each up 5ppts
TD Bank was the dominant advertiser across the cohort of Canada’s largest banks, accounting for 37% of CAN ad spend in 2023. The broader cohort saw 2023 ad spend decline an average of -15% YoY, while TD bank decreased spend -4% through the same period
Neo Financial stands out amongst the neobanks cohort as it has been the most successful in growing its user base. ST data shows that Neo Financial MAUs grew 57% YoY in 2023, averaging 200% YoY growth per quarter from 1Q22-4Q23
While the top 5 banks in Canada have pulled back on advertising in 2023, CAN ad spend across the neobanks cohort increased 20% YoY, largely driven by Wealthsimple (150% YoY) and EQ Bank (90% YoY). Wealthsimple grew from 17% of spend across the cohort in 2022 to 36% across the cohort in 2023, followed by CIBC’s owned Simplii (20%) and KOHO (18%)
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