Companies’ mini-credits or instant money are fashionable. Or that seems in view of the volume of fast loans granted every year.
And it is that mini-credit companies are part of that ecosystem of new competitors of traditional banking, which have burst through the internet and new technologies, invading part of the traditional banking services.
Why this spectacular growth of the mini-credit industry? Contrary to what one might think, the crisis and economic needs are not the triggers for many of the applications for these small online loans.
The reasons are mainly due to a change in the way consumers use financial services, the impact of the massive use of mobile devices and a new generation of digital natives, which demands new forms of the transaction with financial institutions. What can banking learn from all this? What impact can these new competitors have in the medium term in the sector?
Traditional banking fears the changes that may occur in your business and in the customer relationship model with the advancement of technology and the internet of things.
The Fintech gives much fear of the financial sector. The unknown and uncertain scares. And that is what is happening to the banks. They do not know how to adapt to the changes that come.
The first thing they should learn about the transformation that will come and that is already taking place is that customers demand new channels of relationship and transaction with their financial providers. Something in which mini-credit companies take advantage of the usual banking because they were born in that digital context.
The second key variable of success of money companies instantly is that they are open for the user 24 hours a day, 365 days a year. And they are accessible from anywhere with the mobile or smart device.
Whether you are waiting at the bus stop, moving in the subway or taking advantage of some free time while waiting for a friend, you can take out a quick loan without paperwork in a few minutes from your mobile.
Simulator, term, amounts, fees and in a short time in the account. That is what is valued in such a vertiginous world in which we move and to which we move forward with the internet of things.
And worst of all, the traditional banking moves very slowly, not knowing how to correctly interpret the trend that the new banking client asks for in the next five years.
That puts financial institutions at a very vulnerable point because, at a time when the margins of the core banking business are at a minimum with tremendously narrow margins, it forces them to act quickly before these new companies.
Some banks have started their crusade against their fintech competitors or new fast-money companies trying to discredit them. Others, however, have chosen to try to copy the model and incorporate it into its structure.
After all, there is not much added value in the financial product or differentiating element. In any case, the key is the process. That is why it is so easy for a bank to take out an idea or product and soon after the others have copied it.
There is a popular saying that states that without or you can with your enemy, join him. And that is the third way that some banks have sought, to quickly solve new skills such as those of mini-credits.
I personally believe that the key is in strategic alliances with these new small financial companies, which exploit in a specialized way a part of the banking universe. As is happening with virtual means of payment, money transfers or theft advisors.
The lesson is simple. The client asks that things get easy, that the communication is done through the channel and at the moment when it suits him and that it is as quick and simple as possible. It has no more leaf turn. And this is undoubtedly the great success of mini-credit companies, among other examples.