New alliances in finance
Fintechs are coming of age and cooperating with banks
Is a new market about to consolidate, are forces being joined? Finance start-ups are building alliances and exploiting synergies. This development could serve as a model for traditional banking houses.
Cooperating instead of competing
Some innovations are off to an inconspicuous start. Customers of online bank ING-Diba have been noticing for a few weeks now that the company is aggressively promoting fintech Scalable Capital. One click and users looking for an efficient asset management are being directed to Scalable Capital, an inventive alternative financial service provider which garnered a lot of praise recently. ING-Diba was convinced enough to team up with the digital experts.
Cooperation is also the name of the game for HSH Nordbank. To attract new customers and acquire fresh money, the Hamburg-based company in December 2017 offered the best interest rates for fixed deposit accounts. But anybody wanting to cash in on the .95 percent in question could only do so using the finance platform Zinspilot. Since HSH Nordbank does not offer customer accounts the funds are being transferred via accounts at Sutor Bank.
Meanwhile, Sutor Bank, also from Hamburg, has also launched a new digital service. The Sutor Banking platform is offering an automated instant credit assessment; a new product developed by partner company CashCape. Credit approval and disbursement via smartphone app only take a very short amount of time.
Veterans with a penchant for experimenting
Deutsche Bank is taking a similar path, with one notable difference. It also implements a digital tool but one which it was developed in-house. The bank is the first major financial institution in Germany to use a robo-advisor (named Robin) for proposing and opening portfolios. After the crash and burn of AnlageFinder in 2015, Robin is Deutsche Bank’s second attempt at utilizing a robo-advisor and this one definitely looks more promising.
Commerzbank and Comdirect are also working on a digital financial advisor. But why reinvent the wheel when fintechs are already offering practical and efficient tools? By joining forces with Scalable Capital, ING-Diba was able to act quickly, save development costs and earn money from the get-go. Fees for the asset management go to Scalable while ING-Diba bills the customers for trades, accounts and portfolios. A win-win situation with minimal expenditures – thanks to digital synergies.