Finbites #20: Selling loans in online stores. Who's the innovator here?

I thought about banks that sell their loans on e-commerce platforms? Who's the innovator in this case?

Two weeks ago, eMAG launched the digital loan through a solution developed by FintechOS, Idea::Bank Romania, and Bitnovel, while Namirial Group provided the digital signatures.

I thought about it and tried to see who's the innovator in this story…the bank or the online retailer.

For banks, this is a distribution channel. Some integrations have to be done, but this is just another digital loan at the bottom of it.

Yet, something is different in this story. If I have to tell a friend, I will say something like this: "I saw the latest iPhone, and I applied for a loan in the eMag app. They financed my iPhone in 5 minutes."

The bank in the story will be just a simple supplier of money. Is it profitable for a bank to do this? Maybe.

But in the client's mind, eMag is the innovator. 

Here's the reverse story with banks being more innovative. In South Korea, banks will be able to add a wide range of non-financial services to their mobile apps, including food ordering and delivery, following changes to the country's financial regulatory system.


Banks should lower their spreads for currency exchange

A few years ago, Revolut was the cheapest way to convert currency through digital channels. Almost all the banks had terrible rates event if you did the currency exchange in the mobile banking app.

Today, more Fintechs have excellent quotes, close to the NBR rates, and some banks have a happy hour policy allowing customers to convert currencies at the official rate.

I've experimented with Orange Money, Revolut, and two of the banks with a happy hour to assess how much I will save in relation to the standard rates. Read about it HERE.

But the point is that banks should adapt faster and become proactive in creating new value propositions as Fintechs did in the past with the exchange rates.

If Jamie Dimon, the JPMorgan Chase CEO, is terrified by Fintechs, I think that Romanian bankers should be too. 

"Absolutely, we should be scared s---less about that," Dimon said Friday in a conference call with analysts, cited by CNBC. "We have plenty of resources, a lot of very smart people. We've just got to get quicker, better, faster. ... As you look at what we've done, you'd say we've done a good job, but the other people have done a good job, too."

As Dimon said, banks have very smart people, but they just have to get quicker, better, faster. I would add that banks have to become proactive.

Most of the Romanian banks have a reactive approach. They see what fintechs are doing, and after months, even years, they start replicating the features.

Although the fintech threat determined Romanian banks to make huge progress towards the digital era, there's still something that slows them down. The MINDSET.

Many say that banks are slow because of the red tape, the procedures, and regulation, but I think that the biggest danger comes from the inflexible mindset.

The chain of command, the quarrels between the departments, and even the lack of an empowering culture will make banks lose in the long term.

Petr Baron, TBI Bank's CEO, had an interesting statement in the Future Banking Outlook regarding the bank's mindset. 👇

Definitely, mobile will be the trend to shape the banking industry in 2021 and beyond. However, I think there is still a big potential for improvement – often, the appropriate mindset is missing, and banks can't empower their people. This is so crucial since people make technology work. The first step of delivering proper mobile banking experience for the customers, is indeed building an internal culture and finding people with the skillset to actually deliver it.

We also know that empowering employees is one of the best practices in the tech industry. For example, Google allows each employee to nurture their passion projects 20% of their working time. And this has been yielding big results, like Google News.


Here's a fun way to save more in 2021: #VoltSavingChallenge

I remember myself as a teenager struggling to save a few hundred RON for a gadget or a trip. Nowadays, lots of apps could help you do that regardless of your extravagant spending habits.

You can use round-ups, vaults, saving accounts, but it's more fun to do it through a game. Volt, a card-to-card money transfer Fintech in Romania, started a challenge that can make you save around 1,400 RON by throwing each week 1 more RON in the piggy-bank.

If 1 RON plus 2 RON plus 3 RON seems ridiculous, you could start with 5 RON and add each week 5 more to the previous week's number. Then, you'll get a handsome money box at the end of 2021.


Future Banking Podcast - a new season has started

In the first episode of 2021, I had a chat with Anca Nuțiu, Retail Director for Customer Value Management at BRD. We approached topics like 2-factor authentication, mobile payments, and the BRD’s plans for this year in the digital banking space.


My January book

Elon Musk: Tesla, SpaceX, and the Quest for a Fantastic Future, by Ashlee Vance

I'm not a big fan of Musk's communication style, but it's hard to ignore his achievements and, more importantly, his ambitious plans. After all, he might put the first people on Mars.

After Brad Stone's Bezos biography (The Everything Store) and Walter Isaacson's masterpiece about Steve Jobs, this book on Musk was somewhere on the list. But the January effect made me read it sooner.

Few know that Elon Musk was one of the first Fintech founders. In 1999, he founded X.com, an online bank that 20 years ago did very much what Fintechs do today.

Besides a great story, Ashlee Vance's book will show you glimpses of how Musk's brain really works. Like other prodigies that think on a different scale, Musk was selfish, egocentric, bad-tempered, and demanded sacrifices from all that worked for him.

I'd say that before making business leaders our role models, we should read their unglamorous and unauthorized biographies.

But to "render unto Caesar the things that are Caesar's", Elon Musk drives humankind forward as nobody seems to do anymore.

I'm curious what other innovators do you know working today to send humans to another age. Let's keep the conversation going.

Leave a comment


Jobs in Fintech & startups

Fintech is one of the best industries to work in right now. That’s why, occasionally, I will list here some of the openings I hear of in the Romanian market.

According to the job description, the GM will have to define and execute the local strategy assuming end to end responsibilities for country PnL. Revolut posted the salary too, which is 302,000 RON (62,000 EUR) a year, but without specifying if it’s the gross salary or not.

According to the job description, the Head of IT, Technology & Innovation will report directly to the GM and lead a team of 50 people. He/she will have to handle a wide range of projects and development areas, like Open Banking, Business Intelligence, AI & Reporting; mobile app development, IT & Cyber Security, IT Architecture, Testing Management, Process Modelling & RPA. 

IT Smart Systems (ITSS) is a Romanian company that runs Open Banking, Omnichannel transformation & digital customer experience projects. It works with leading banks in Romania and startups alike. At the moment, ITSS is looking for 3 developers, 1 digital identity consultant, and 1 quality assurance specialist.

Neurolabs is an AI startup with teams in Edinburgh and Cluj, but this specific role is in the Cluj-Napoca’s office. The back-end cloud engineer will be working side-by-side with the Computer Vision Engineering team.

Finqware is another startup in the Open Banking landscape that plans to become a Central & Eastern Europe provider for banks, businesses & fintechs. Its core project is FinqOne API, a cloud-based middleware that builds a bridge between companies and their financial service providers.

  • Future Banking is recruiting a senior sales specialist 

After 4 years of building a strong conference brand in Romania, Future Banking is set to reach new markets, and as a result, we’re looking for a new team member.

With the key role of finding new partners and growth opportunities in CEE, you can be part of the exciting journey of making a conference in Bucharest one of the best in the region.

If you take the challenge, you can reach out at razvan.enache@wall-street.ro

  • How to Web is looking for a new social media & comm manager 

How to Web is one of the most popular startup conferences in the region that provides a creative playground for entrepreneurs since 2010. Along with the conference, How to Web runs a series of startup programs and educational initiatives.

Drop a line to the founder for more details about the job 👇bogdan.iordache@howtoweb.co


Other worth mentioning Finbites

"For those who thought (Bitcoin) might turn into a currency, I'm terribly sorry, but this is a highly speculative asset, which has conducted some funny business and... totally reprehensible money-laundering activity" - Christine Lagarde, President of the European Central Bank

  • Octobank, a new Fintech in CEE with a Romanian founder 💳

Bogdan Atanasiu has registered the Octobank in Prague. The startup will offer in a freemium model business IBAN accounts and debit cards, expenses and transaction management tools, invoicing, and payroll services, but premium users could get micro loans and insurance. The plan is to expand to Romania, Poland, and Hungary.

The partnership enables TBI Bank to list the loan offering in NETOPIA's platform. According to the press release, the retailers will get the loan facility's approval in 24 hours max, while the online request process will take 5 minutes.

  • Valentin Tataru has been appointed as the new chief economist of ING Romania 📝

Valentin joined ING in 2007 and worked for ten years within the ING Bank's treasury department. In 2018 he was named economist and started to cover Romania, Bulgaria, Serbia, and Croatia.

The startup specialized in developing intelligent virtual assistants (chatbots) for companies gets a new round of financing of 2.5 million dollars. GapMinder Ventures invested $ 2.2 million, while Early Game Ventures and private added the rest of $300k.

After closing the deal, Vista Bank will reach 1.2 billion in assets and 1.1 billion client deposits. The acquisition is subject to National Bank's and Competition Council's approval.


You've just finished reading Finbites #20. Do you have feedback or something to say? Drop me a line at razvan.enache@wall-street.ro, and let's keep the conversation going. I read and respond to every single email.


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