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Will 2018 be the year for UK-based challenger bank Tandem?

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The year 2018 could not start better for Tandem, a digital challenger bank based in the UK that is pursuing a different strategy compared to other players on the market.

Tandem is a London-based Fintech that was founded in 2013 by Matt Cooper, Michael Kent and Ricky Knox, and that raised a total of $145+ million so far.

The digital bank has been quiet on the product development side since its launch in 2013. The first product was launched last February 2018 to the public, a credit card connected to the mobile app, that cashback 0.5% to users and has no fees when being used abroad.

Tandem is however running after something else. It indeed announced various unexpected acquisitions in the last months. Last summer for exemple, the company announced the acquisition of Harrods Bank that was officially approved by UK’s regulators in December.

In a statement to City A.M., Ricky Knox, CEO of Tandem, said:

“This puts us miles ahead of Monzo and Starling. We’ll be quite possibly the largest challenger bank by assets and the biggest by revenue.”

More recently, Tandem announced the acquisition of Pariti, a UK-based money management application platform that lets customers pilot their savings.

Tandem’s aggressive strategy to “push revenues into the double digit millions this year” is going against most strategies pursued by challenger banks like the Monzo or the Starling Bank that are focusing on community building and their portfolio of self-developed financial products.

 

Credit Suisse is adding CHF 30 million to support Swiss Fintech start-ups

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Credit Suisse announced yesterday a new fresh financing of CHF 30 million added to its investment fund to support Swiss Fintech start-ups.

The fund was first created in 2010 under the name “SVC – Ltd. for Risk Capital for Swiss SMEs” in collaboration with the Swiss Venture Club, and has invested more than CHF 100 million in 44 companies. The main objective of this new round is to accelerate the development of Switzerland as a top hub in financial technologies in Europe.

To be eligible, Fintech companies must be located in Switzerland or have a clear connection with the country. A Fintech Committe made of experts in the field will be constituted to identify investment opportunities.

According to Didier Denat, Chairman of the Board of Directors of SVC:

“As the leading bank for entrepreneurs, one of our key objectives is to strengthen and promote Switzerland’s role as a center for business and employment through various measures. These measures include the provision of venture capital for SMEs with growth potential. At the same time, our commitment allows us to connect with innovative companies offering solutions that might be of interest to us as a bank or to our clients.”

The beneficiaries of the fund will be innovative companies in different stages of their life cycles from around the country.

 

Brillant video that explains kids gender inequality in the financial sector

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The video was published by the Finance Sector Union of Norway to denounce gender inequality in the financial sector.

https://www.facebook.com/finansforbundetNO/videos/10156793637468273/

A woman is asking two kids, one girl and one boy, to fulfill their own tube with pink balls for girls and blue balls for boys.

Once all balls have been collected by the two kids and allocated into the correct tube, the woman rewards both kids with candies. However, the boy is receiving more candies than the girl.

Interestingly, we can see that all kids feel confused on why do girls receive less candies than boys for the same “job”.

One boy is saying:

“She was just as good as me she should get the same reward, because otherwise it is unfair.”

Women working in the financial sector earn on average 20% less than men. The video ends by stating that “unequal pay is unacceptable in the eyes of children”, and continues by asking “Why should we accept this as adults?”

 

Do cashless societies will end to financially exclude non-tech savvy?

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In the myriads of avantages that digitization is bringing to societies, there are some negative effects as shown with Sweden’s cashless revolution.

The country is renown worldwide for its advancements in digital payment solutions with companies like iZettle or Klarna that are pioneers in the sector. The problem with being an advanced tech economy is that your are leading the way without really knowing what’s ahead of you.

That’s kind of what Sweden is currently experiencing with the ultra fast transition that is happening in mobile and digital payments. Authorities are indeed worried about the consequences of such a transition and the impact on infrastructures used to handle cash.

The “No cash accepted” environment isn’t that difficult to adapt for the young population that is used to paying with a credit card or a mobile, but is much harder for the elderly or the lower-incomes who aren’t as digitally savvy.

Why? Simply because if businesses don’t accept cash, it means that those people are excluded from the system and can’t shop, eat or bank.

This article was first published in Fortune

 

Bank on a truck, reconnecting with customers in rural Germany

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Over the past years, many banks have been forced to close branches but few of them have been working on rethinking their entire business models.

Most of the time, you will hear about digital and online solutions. In rural Germany, things are a bit different since banks have found a new and unexpected way to reconnect with customers by literally implementing ‘mobile banking’ instead of waiting for the client to come at their branch. 

Juergen Schaller, a bank manager at Sparkassen, is now spending four days a week in his truck to bring mobile services, including cash machine and advisory, to tiny countryside villages.

According to a recent study published by KfW, the number of physical bank branches in the country has plunged by a quarter over the past 15 years to 35 per 100,000 people. The European average is 37 per 100,000.

As explained by Steffen Haberzettl, sales director at the Kronach-Kulmbach Sparkasse:

“It was primarily local businesses and older people who had not embraced online banking who were taking advantage of the mobile branch, which first set off on its rounds in 2015.”

Haberzettl estimated that around 20 people visited the bank at each stop, equivalent to 12,000 customer contacts a year. The number is of course much lower than the 8,000 online banking logins per day, but “we invested in this service for our clients knowing that it wouldn’t make enough money to pay for itself”, he said.

As explained by Maria Neubauer, a 70-something client:

“The Sparkasse bus is great for making transfers, or doing anything you need. We are happy, especially those of us who don’t have a car to visit a branch further away.”

According to Thomas Schnarr from consulting firm Oliver Wyman:

“The speed at which it will happen is hard to predict, and will depend above all on how the banks manage to keep branches relevant as a channel for their customers.”

What this initiative is teaching us is that human relationships remain fundamental, especially when retail and businesses clients have questions that require personalized advice.

This article was first published in The Local

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