Mathieu Staniulis, Desjardins’ chief transformation officer for retail banking, is four years and billions of dollars into a push to bring Desjardins into the digital age—and he’s not finished yet.

“People are always asking me, when is the transformation going to be over?” Staniulis said in an interview. “My answer is, we’ve been transforming for the last 125 years, and I expect it to be the same in the future.”

Desjardins is Canada’s seventh-largest bank or credit union, but it holds a special place in Quebec culture as the leading francophone firm, with residents of la belle province often opening accounts in childhood and never switching. Yet despite its deep cultural roots, the member-owned co-operative, which offers banking, insurance, and other services, found itself slipping behind as digital-first competitors gained ground. Desjardins lost 80,000 members from 2012 to 2017, and lagged its peers on a measure of customers willing to recommend the institution to others, spokesperson Véronique Blais said in an email. 

In 2021, Desjardins started significantly increasing the amount it spends annually on updating its technology. The firm now spends $2 billion per year on tech transformation, double what it was spending four years ago. Modernizing the bank’s back-end technology, some of which was built in the ’60s, accounts for a significant amount of the spending, Staniulis said.

Customer feedback drove the changes the institution made, he said. Desjardins created more efficient processes for everything from signing up for personal loans to marketing targeted at individuals. The changes helped Desjardins add 140,000 customers, grow its revenue by 10 per cent over the course of four years and increase its sales initiated online from 25 per cent to 40 per cent in the same period, putting it in a leading position among Canadian banks, Blais said.

Staniulis said that’s a win for everyone involved. “If it’s good for the customer, it’s usually good for the organization and good for the employees,” he said. “We have to stay competitive.”

Doug Macdonald, a consultant who advises mid-sized challenger banks and credit unions on tech transformation, said Canada’s financial institutions are all grappling with the need to update technology that has served them well for decades, but isn’t designed to handle innovations like real-time payments, open banking and AI. “These systems, some of them were written for punch cards,” he said.

In addition to that challenge, any new technology Desjardins incorporates must work across Quebec’s system of credit unions, or caisses populaires, Macdonald said. The Fédération des caisses Desjardins du Québec had 204 members across the province as of 2024. “That’s very difficult to build, and they do it in a very seamless manner,” he said.

Another challenge financial institutions undergo when revamping their technology is deciding what’s worth spending money on. Macdonald said Desjardins’ focus on improving how likely its customers are to recommend the institution to others when setting priorities is “a good place to start.”

One technology Desjardins has decided to invest in, alongside Canada’s big banks, is generative AI. The firm uses the technology to assess insurance claims through photos submitted via mobile phone and has rolled out a chatbot to attract new customers, chief executive Guy Cormier said in an interview. 

Desjardins now spends about $200 million on updating its retail banking technology annually, which accounts for between one-third and half of the business line’s total expenses, Nathalie Larue, executive vice-president of personal services said in an interview. The firm, which has seen a “rapid change of behaviours” in members and clients, uses data to predict the advice that members and clients need and has automated many tasks, Larue said.

Macdonald said making the decision to undergo a tech transformation as sweeping as Desjardins’ is not easy. He compared the challenge to a homeowner deciding whether to spend money repairing a furnace that’s on its last legs, or buy a new one.

“These things can cost billions of dollars, and they can tie up your organization for years, and there’s a lot of disruption for staff and for customers,” he said. “You can always repair your furnace to get it to run for one more year. But eventually, you get to the point where you can’t plug in the latest thermostat.”