The premise is that Fidor Bank, which is built around Web 2.0 and social media, has three engagement models. These begin with a community where people talk about finance and share experiences; then there is the opportunity for these members to use Fidor’s payment services; and finally they can become a full retail banking customer with a current account, loans and savings.
Currently, about 70% of the community have used the payments service and about 30% bank with Fidor. It is not just a consumer-focused bank either. Fidor has its own core banking software and is open to third-party suppliers to integrate applications into it. It also offers businesses its technology as a white label service. For example, it recently signed a major contract to set up a global payments service for a business customer in Germany.
Fidor currently has more than 200,000 people registered and 150,000 community members. It has €160m worth of deposits, and its lending totals about €100m. With only 34 staff, no branches and a cost of only €3.50 to set up a customer with full banking, the overheads are low compared with traditional banks. But in contrast to existing banks, trust is high. This addresses the challenges facing most banks at present – those of cutting costs and increasing trust.
Fidor has no sales staff – it relies totally on recommendations from its community. “This is crowdsourcing. We let the customers talk about Fidor Bank. We share our experiences of all parts of life,” says Kroner.