Scotiabank's Tangerine Exploring Facial-Recognition Technology

  • Tangerine is working with fintech firms in Silicon Valley
  • Bank seeks be fast and nimble `challenger brand': CEO

Tangerine, the online lender that shook up Canadian banking in the late 1990s as ING Direct, is experimenting with facial-recognition on mobile phones and other technologies.

The bank was the first in Canada to allow check deposits by taking photos with mobile phones in 2013, and to use fingerprint scanning and voice-enabled banking. Tangerine is now delving deeper into such biometric technology -- including the possibility of facial recognition -- to improve customer experience and security, Chief Executive Officer Peter Aceto said.

"No one’s sure what the gold standard is going to be, so you have to have the ability to be trying and testing and see what works,” Aceto said in an interview Tuesday in Toronto. “Certainly interacting with our mobile app using your face, using your voice, using your finger are things that we’re going to enhance and deploy in a much broader way."

The company, which Bank of Nova Scotia bought from ING Groep NV for C$3.1 billion ($2.4 billion) in 2012 and renamed Tangerine, is working with financial technology firms in Silicon Valley, Canada and Israel, Aceto said. Tangerine also has a partnership with Toronto’s Ryerson University, which has worked as a incubator for technology startups.

“All the banks in Canada are thinking about fintech,” he said. “As a challenger brand, we need to work hard to be faster and be nimbler and try and keep ourselves a step ahead."


Tangerine’s predecessor, ING Direct, started Internet banking in Canada in 1998 after entering the country a year earlier with its branchless concept. The Dutch-based firm made its name with high-interest savings accounts, low-rate mortgages and banking “cafes” to trumpet its brand. The lender began offering mobile banking in 2010, ahead of most larger competitors.

Other efforts by the company are aimed at speeding up customer interactions. Users will be able to switch between a tablet, mobile phone or computer, initiating an online chat, e-mail conversation or telephone support without needing to re-authenticate, he said.

Tangerine is adding four “pop-up” mobile locations across Canada, including Winnipeg, Calgary and the Maritimes, after a successful test project with two such venues this year, he said. “Imagine an Apple Store in a mobile shipping container, where you can interact with our brand and our people," Aceto said.

The bank also is marketing a no-fee MasterCard with money-back rewards, adding to products that include savings and checking accounts, mutual funds, registered investments, mortgages and credit lines. The company has about C$38 billion in total assets and 1.9 million clients.

Tangerine’s technological prowess gives Toronto-based Scotiabank an edge among its Canadian competitors, said Jason Bilodeau, a Macquarie Capital Markets Canada analyst.

“It gives the bank scale and credibility in the direct market and a brand/platform with which they can more readily experiment with developing products and strategies,”  Bilodeau said in a Sept. 21 note.