There are quite a number of new bank services around Europe.
Some are from insurance groups (Soon and KNAB) and some are from banks (Hello and Moneyou).
It’s hard to keep up with them all, but I think these four are worth a quick review.
First Soon versus Hello.
Soon is a mobile first offering that is trying to be the Moven of Europe. It is designed specifically such that the mobile relationship is engaging and immersive from the opening of the app through to the movement of money.
It is not an evolution of a bank’s online service to mobile, as demonstrated by the opening screen which requires no password or login number.
That leads to the response from the incumbent banks, who are threatened by Soon.
The response from BNP Paribas was to launch Hello Bank.
Launched in May 2013, BNP Paribas has pumped €80 million into the project in 2013, mainly because they expect to get a lot of new market share.
The bank aims to achieve 1.4 million mobile customers by 2017, of which two-thirds will be new account openers and just a third existing BNP clients.
In other words, when threatened by a new entrant the incumbent launches a new bank to compete.
Does it have to be that way?
In the Netherlands, Aegon Insurance Group launched KNAB in 2012, a service aimed to turn banking upside down (as does its name, which is Bank spelt backwards).
The focus of KNAB is to provide great remote service through mobile PFM. In their launch ad, the company was trying to get across the idea that KNAB is a revolutionary new online bank based on a simple question: Why?
In this TV commercial the question was answered with visually striking simplicity: the christening of a bottle of champagne with a boat. The aim was to illustrate the radical paradigm shift that KNAB brings into the financial world by putting the client and not the product at the focal point of all operations.
This was followed by a more impressive ad campaign more recently:
What was interesting is that, according to Pieter Lakeman, founder and president of the Research Foundation Company SOBI, KNAB founder only approached Aegon because it is so difficult to get a banking licence in the Netherlands:
“The initiators of KNAB have not dared to ask for a banking license themselves, I understand. They were afraid that the procedure would have a very low probability of success and therefore explicitly chose to join Aegon because they already had a banking license.”
In addition, the high fee rates for KNAB accounts – the bank charges customers €15 per month compared with just €1.25 for an account from ING – has meant that they have now shifted their focus to small business owners.
Meanwhile, the KNAB competitor is MoneYou.
ABN Amro has been running MoneYou for over a decade providing online savings, loans and mortgages. In 2011 it launched a major new version of the service: a mobile savings app that provided social savings across Germany and the Netherlands.
The bank made quite a big splurge about it.
It was lauded as a SmartyPig style service, using social savings with goal setting capabilities, and has been cited by many as an innovation.
I would claim it’s not based upon recent reviews, which talk about slow money movements between accounts (three or more days) and interest rates not being as good as elsewhere.
What that implies is that even with the smartest money apps, if the bank doesn’t provide the basic hygiene services – fast money transfers and competitive interest rates – then customers will still think you’re rubbish.