Melange panel foresees partnerships between fintech and traditional banks

Traditional banks are interested in catering the changing needs of their business customers and expats — Unicredit Bank Austria AG in conversation with Holvi (digital current account for your business), ChillBill (automatic bookkeeping service) and Baningo (bank consultant matching service) at sektor5's expat event Melange.

Melange panel Clemens Helm (ChillBill), Leah Marie Zeppos (Holvi), Max Nedjelik (Baningo), Martin Mayr (Bank Austria) and moderator Andie Katschthaler.

Martin Mayr (Head of Competence Center for Diplomatic Missions & International Organisations at Unicredit Bank Austria AG): “Austria is the cheapest country for mortgage loins, withdrawing money from competing banks is for free and one pays less for banking compared to other countries. We’re really quite fortunate.”

To open up an account at Bank Austria one needs to bring a Passport or (for EU-citizens) an ID with a signature. Domestic clients need to bring a ‘Meldezettel’. When requesting a loan or tradecard Bank Austria needs to see tax filings or a proof of income. A small deposit on the account will also do.

Leah Marie Zeppos, Country manager for Germany, Austria and Switzerland at Holvi (a Finnish company) sees huge differences between European countries when it comes to banking and payment possibilities. For instance: to those coming from European countries where other payment methods are more widespread, it might be surprising that SEPA is such an important part of banking in Austria and Germany.

To open up an account with Holvi one needs to make a selfie with their passport and show a proof of residence, as well as some proof of business (generally a link to your website is enough). Plus whatever the national requirements are.

At the moment it is free to create an account with Holvi in Germany and Austria. When they roll out their planned premium model, Holvi will charge only for certain elements. “It kind of creeps up at you, the hidden costs involved with ‘traditional’ banking.” Holvi aims to be transparent about their cost structure.

Martin Mayr on the credibility of traditional banking: “When you earn more you are more concerned about where to put it. You want to go to a respectable bank when you are saving for your pension. Someone who has a name to loose. You will want to be able to go to your bank when you’re signing the documents for your mortgage loan. Bank Austria even offers consulting via video conference and in English, for instance for investments.”

Custom solutions in banking

Clemens Helm (ChillBill) on when to best open a business account: “When I was working as a freelancer I thought I didn’t need a business- or separate bank account. I let my business expenses run over my private account. This caused a lot of work afterwards, as I had no overview of my business expenses, private expenses and income. It is wise to open up a business account as soon as possible.”

Mayr adds that when it’s about investments you will want to open a business account as the inflation is higher than the interest when you just leave your capital in a private bank account.

Helm warned that the process of founding a company is a lot of back and forth with your notar and your bank consultant. The process can easily take a month.

Max Nedjelik (Co-founder of Baningo) sees digital nomads and expats join his platform, even prior to them entering Austria. He stresses that a specific adviser can indeed help you to get started in Austria. “It is time consuming to get in touch with a bank and open up an account. Trust is such an important element as well. With baningo you have the convenience of picking your bank adviser, and you decide when and where to get in touch. For complex issues, like a loan for your business, you may want to get in touch with three banks to get a comprehensive overview of the options. Just imagine how much time that would cost you if you physically need to go to all of these!” Banking on demand is how Nedjelik summarizes the service Baningo offers.

Mayr noted that Bank Austria serves their clients in 15 different languages.

What’s next for fintech?

On the topic of technical debt, Zeppos notes that fintech startups are more lean and can tap into users needs. As the country manager for Germany, Zeppos says she works closely together with product. “Number26 let’s you block your account in under 5 minutes, digitally. No need to call your bank and wait until you reach someone. That’s one real world problem solved.”

But don’t get her wrong. “It is not us against them, traditional banks will get more agile, it’s just startups dictating what the future needs are moving towards. One of the trends is that customers don’t need or want the personal contact for every element of banking, but when they do it needs to be stellar.”

Next on the roadmap for ChillBill is comparing your expenses with your bank data, and automatically marking expenses as paid. Users will also be able to start a transaction from within the ChillBill platform. ChillBill will be able to roll out this feature in a couple of months with German banks and SIX banks in Austria (including Bank Austria, Erste Bank and Raffeisen).

Educating its customers on cyber security is a big topic for Bank Austria at the moment.

The event was moderated by Andie Katschthaler.

The next Melange will take place June 8th, starting at 6pm (cause it is never too late for a good cup of coffee). We’ll talk about how to set up shop in Austria — how to choose the right company form, what legal requirements are you looking at starting a business in Austria — with the WKO, a lawyer specialized in Corporate Law and an expat entrepreneur who went through the trouble of setting up a company in this beautiful country.

For more information on the Melange event series:

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