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A Royal Bank of Canada (RBC) logo is seen on Bay Street in the heart of the financial district in Toronto, January 22, 2015.

MARK BLINCH/Reuters

Online lenders who provide short-term loans to small businesses say that Canada's big banks have nothing to fear from their success – but the search for talent and the speed with which they can develop technology is certainly making the banks sit up and take notice.

"I'm not sure we are necessarily threatening them," Kevin Clark, president of Lendified and a former executive at Bank of Nova Scotia, said during a panel discussion at the Canadian Crowdfunding Summit in Toronto on Thursday.

Jeff Mitelman, chief executive officer at Thinking Capital – a lender that struck a co-branding partnership with Canadian Imperial Bank of Commerce in November, giving them the credibility to attract new customers – agreed: "Our experience has been overwhelmingly positive," he said.

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In both cases, the companies provide small loans that the banks might not otherwise make.

A third panelist, Tabitha Creighton, CEO of InvestNextDoor, a marketplace lender that connects investors with small businesses, said that the banks haven't yet embraced this style of lending because it is too costly relative to the potential profit.

But the bank-hugging only went so far. In outlining how they are part of a financial technology – or fintech – wave that promises to disrupt traditional finance, the executives argued that they enjoy a number of advantages over established lenders.

First, they are nimble, or faster than the banks at responding to consumer expectations that are being set by the likes of Uber, Amazon.com and Netflix. Mr. Clark pointed out that the big banks are trying to develop a fintech culture within their centuries-old businesses.

"It's a huge task," he said, where speed is measured in quarters and years, in stark contrast to the days it takes a fintech firm to respond to an idea.

Second, online lenders appeal to the millennial generation which, if you agree with some of the generalizations about these 20- and 30-somethings, is more likely to embrace non-traditional lenders and make online financial transactions – offering what Ms. Creighton called "a massive shift in the role of banks serving entrepreneurs."

And third, they are lean. Thinking Capital has a staff of about 200; at Lendified, there are just 15, three of them armed with PhDs.

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While that might limit these small companies in their ability to take on larger or more complex projects, it also makes them potentially more attractive to tech-savvy graduates who are looking to establish themselves. That could be a notable advantage when the banks are looking for similar talent to fill their technology rosters.

But the panel discussion was by no means focused solely on tallying the advantages of fintech over traditional banks. As Mr. Clark said, the rise of online lenders can make it far easier for small businesses to get the funding the need, when they need it.

"The good news is that for a small-business owner, it has never been better," he said.

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