Tangerine is owned by Canada's third-biggest lender, Bank of Nova Scotia (>> Bank of Nova Scotia), but has positioned itself as a challenger to the country's biggest consumer banks, having so far built up a market share of 6 percent to 7 percent.

Tangerine, previously ING Direct, was rebranded after Scotiabank bought the business from Netherlands-based parent ING Groep (>> ING Groep) in 2012 for C$3.1 billion. ING Direct had operated in Canada since 1997. Tangerine is now Canada's 7th biggest deposit taker and 6th biggest provider of home loans.

"We have roughly 2 million clients today. Our aspiration over the next few years is to get to 3 million," Chief Executive Peter Aceto said in an interview at the bank's headquarters in Toronto.

Unlike its larger rivals, Tangerine does not have a costly branch network to run, instead offering its services online, including no-fee checking and competitive interest rates.

Aceto said the bank will focus on customers looking for alternatives to traditional banks, to take advantage of a technological revolution that has resulted in a rapid adoption of mobile banking apps and far fewer customers using branches.

"I think we are on the edge of a tipping point where we will see millions and millions of Canadians choosing a model like this. We think today there are somewhere between 10 and 12 million Canadians we call 'direct ready' - consumers who would be willing to buy one or more products from a bank they would never meet - and we think we should get significant market share in that growing category," he said.

Aceto identified three key growth areas - credit cards, wealth management and checking accounts. The bank now provides around half a million checking accounts, a product seen as a key conduit from which banks can cross-sell other products.

Aceto said wealth management is the area most ripe for change, with challengers posed to undercut established providers on fees and deliver services to a currently underserved mass market.

"I see wealth as something that is the most prime for disruption. I think that's the place where Canadians get the least and pay the most," he said. Tangerine provides mutual funds to about 100,000 customers.

(This version of the story corrects number of mutual fund customers in last paragraph to 100,000, not 1.6 million)

(Reporting by Matt Scuffham; Editing by Steve Orlofsky)

By Matt Scuffham

Stocks treated in this article : Bank of Nova Scotia, ING Groep