Toronto-based financial services data platform startup Cyder raised a $3 million seed round led by Conexus Venture Capital, with MaRS Investment Accelerator Fund, Graphite Ventures and Sprout Fund participating.
The startup provides credit unions with a loyalty rewards system to attract new members and retain existing ones. More than 20 credit unions in Canada and the U.S., each with 7,000 to 500,000 members, use Cyder.
“Credit unions invented loyalty and rewards through their profit sharing models,” Sukhman Dulay, co-founder and CEO of Cyder, said in an interview.
While chequing, savings and registered accounts are largely similar between financial institutions, rewards programs help differentiate services. Dulay claims that credit unions can set up new offers for members in minutes instead of weeks on Cyder’s white label platform.
This comes as Canadians are increasingly shopping around for their financial accounts. A quarter (24%) of Canadian residents said they opened a financial account with an institution other than their existing bank in the previous 12 months, according to a March 2025 survey conducted by Environics Research.
A Canadian story
Cyder initially launched as a data platform in 2021 to help banks get real-time customer data. It expanded to the loyalty business in 2024 when it raised a $1.5 million pre-seed round with MaRS Investment Accelerator Fund, Desjardins, Aperture Group, Arlene Dickinson and other angel investors.
At the time, the University of California, Berkeley’s startup accelerator Berkeley Skydeck approached Dulay, offering to fund the firm’s incubation in the San Francisco Bay area. But the accelerator also required Cyder to register as a Delaware corporation and become an American company.
“We stuck to our roots and, and decided no, we’re going to fight back on that and stay Canadian,” Dulay said. “We’re a mission-driven organization, our goal is to help the credit union sector thrive [in Canada].”
Cyder helps financial institutions collect customer data with the clients’ consent to understand behavioural patterns, Dulay said. Large banks can easily spot patterns with millions of clients and digital banking, but credit unions don’t have a large sample size and focus more on in-branch personalization.
“A lot of it’s about next best offers … finding the most relevant way to target your members so that it’s actually meaningful for them,” Dulay added. “For example, if a member isn’t a student, targeting them with a student loan just doesn’t make sense.”
To help credit unions increase member spend and build target offers, Cyder can collect information like purchase data, online behaviours and customer intent signals. It can track over 100 reward behaviours in four main categories: transactions, community benefits, one-time incentives and ongoing rewards.
Tracking where and how members spend helps credit unions find small local businesses to partner with, Dulay said. Small businesses like florists don’t have the scale to partner with big bank loyalty programs, but could partner with credit unions for cash back or gift cards. Part of the fee from each card swipe could also go back to local causes.
One-time incentives are oriented to members’ financial habits. This could mean rewarding them for setting up pre-authorized deposits into retirement savings or meeting a savings goal.
Ongoing rewards help credit unions grow their assets under management and increase retention. Longer tenured members, those with more products or higher account balances, could be rewarded with better deposit rates, Dulay said. “It’s based on the depth of your relationship… that’s the thing that banks can’t offer today.”