Check24 has recently announced that it has applied for a banking license. Although banks continue to be regarded as partners, they also want to address their customers directly with their own new products. The established banks are thus threatened with another strong competitor.

On all slides of the Fidor Bank , on which we had presented today’s as well as future competition, it could be seen that comparison platforms were THE future competition for us. With the news that Check24 is now seeking a banking license, we are taking this scenario a significant step closer. Partner of the Bank Blog Adorsys is a partner of the Bank Blog In the competition for the customer, I attest to the comparison platformsan outstanding starting position. After all, when choosing a product (mostly credit) or an infrastructure (account or depot), in the vast majority of cases the customer first and foremost refers to one of the many comparison pages in order to list the individual providers in the form of a simple series. Irrationally, consumers trust these platforms to reflect an objective picture of reality. The fact that these platforms receive brokerage commissions, it should only be clear to a few customers, even if it was discussed again and again in German courts, to what extent the seemingly objective comparison platforms thereby make a real objective image or misuse their market power of the “first stop”.

Scale for the distance / proximity to the customer

” Who is closest to the customer? “Is the key issue of digital competition. Who can most likely make the most money out of the crowd of Internet and mobile shoppers? There is a clear unit of measurement that measures the distance between customer and provider: the key figure cost per order or cost per customer, The lower these costs are, the smaller the distance to the customer, the easier it is, the higher the likelihood that a customer will win a transaction. Here, banks perform much worse than make comparison platforms: A current account customer costs between 80 – 120 EUR, depending on how much we need the provider. If one adds “onboarding bonuses” and “satisfaction guarantees” to it, one is quickly at 150 – 200 EUR for a new customer. If you want up-to-date numbers, you just have to look at the popular affiliate networks. There you will find a good indication. Take the consumer-credit product as an example. Around 2 percent of the loan amount is usually necessary as a mediation fee. If you want to be better positioned, you want to sell more loans, then more accordingly. With a long running time, no problem. Only: Consumer loans are usually short-term, so around 1.5 – 2 years. The longer a consumer loan runs, the higher the risk costs. Risk costs must be taken into account by banks at the beginning of the term, as well as the brokerage commission. And: A customer who comes for a loan on a comparison platform, certainly will not remain over the term of this loan. I know examples where a customer returned to the same bank for the next loan, returned to the same bank, and was again allowed to pay the customer acquisition costs for the same customer. This means for a bank: Who mediates on this way loans not only gave up any ambition on a proprietary brand, but also writes negative numbers.

Know how customers “work”

You rub your eyes and ask yourself: Why are the banks doing that? They do not know how the customer works. And after more than 20 years of weaving, very few decision-makers still know the mechanisms of the Internet. Instead, they go into addiction and hang like a drug addict on the drip of their dealer. Our Conversation as DAB / Fidor Bank Founding Team: You have to escape from this murderous mechanism. Already at DAB Bank (in the late 90’s) and later also at FIDOR Bank we had put a user and customer community at the center of our positioning. The users of a community cost a fraction of a bank customer and have the opportunity to exchange or evaluate products. Instead of a comparison platform, this is called “peer-to-peer support” based on individual experience, combined with the possibility of questioning the evaluator of a product according to the evaluation background. Almost incidentally, the bank was able to drive any form of customer interaction and integration with high utility across this community. It also created an outstanding USP , which makes a Fidor Bank unique to this day. (The emphasis is on “until today”).

Turn “users” into “customers”

An alternative to building an internal lab would be to build a team outside the established organization, an approach often compared to a ‘greenhouse’ or ‘green field’ scenario.

This approach makes it possible for the newly created independent company to create its own culture, set its own rules and have independent incentives and performance indicators.

The controller in you now asks: And how do I turn it into a customer? Based on my Fidor experience, it took 3 users in the community to make a Fidor customer out of it. So the magic word is the so-called ” conversion rate “. If you also know that a community user cost us around 3 EUR at that time, then all you have to do is add the KYC costs (about 6 EUR) and you know the “Cost per Customer” of a Fidor Bank: approx. 15 EUR. I dare to say: Cheaper it was not.

What is the conclusion for a bank? Anyone who sells via comparison lists sacrifices his positioning and automatically becomes a commodity commodity . This is justified in the system, because a comparison platform must produce comparability of the offered goods / achievement. This is at the expense of the brand. The sales team and marketing team of a bank certainly do not pull together here. If you do not escape this trap as a bank, you hang like a drug addict on the drip of the comparison side, sacrificing contribution margin and brand and the proximity and relationship with the customer. As a Fidor Bank, we have therefore taken great care to be included only occasionally in comparisons. Rather, we also let ourselves be removed from comparisons and focused on communication in our community. The keyword “brand parity” makes the rounds here, ie the distinctness of brands of individual suppliers in the same segment. Gas stations, insurance companies and banks traditionally perform poorly. No wonder.

Check24 becomes a bank

Why on earth is Check24 taking the step towards the bank? On the one hand, this would make one’s own B2B customer competition. So why slaughter the cow that can be milked so brilliantly and thankfully? Why load the complexity, cost and risk of banking? Even today, comparison platforms operate their own usually very aggressive offers. These are products that are operated by partner banks, but which are provided for the respective comparison platform with a sales-controlled pricing under their own brand in the white label approach. By means of these aggressive products, the comparison platforms compete with each other AND drive the banks ahead of them. For the bank, this means utilization. And in the case of the frequently discussed credits with credit, the respective comparison platforms usually took over these interest rates from their marketing budget, since these are extraordinary and attention-grabbing measures. Only: The banks could not and did not want to portray them like this. Check24 is an aggressive player in this context, who would like to see credit intermediation not only from the partner bank but also the (partial) assumption of interest on loans with interest rates. For this, the bank would receive a large number of (disloyal) customers in return.

Danger for customer sovereignty.

But do comparison platforms have to hold a banking license? If it comes as indicated to an open banking platform, then this can mean:

• The customers on this platform are legitimized. This is worth something. This is an asset!
• With the help of PSD2 Check24 can aggregate and evaluate the customer’s account data – of course after approval – and then submit the best financial offer to the customer.
• In addition, one can offer credit cards and payments. Cash flows from and into brokered products of partner banks thus run over their own offer. The customer will not be delivered to a third party at this point.
• Loans can also be granted, according to the specifications of your own risk management. I could imagine that some risk management ideas of the partner banks failed. Of course, the same rules apply to everyone here, but I also know that you can interpret these rules differently.
• (Account) Data-based supermarket for financial products.
• Insoles? Hardly today, but maybe in the future?

The respective product will not be so much in the foreground in all these considerations. On the contrary, Check24 should have learned from Amazon: There, too, one looks very closely over a certain period of time at which products on the Amazon marketplace customers are particularly in demand, before deciding to develop their own offer. The consequence: The previous provider of this offer has made it significantly harder to sell its own offer. The marketplace operator, however, has the advantage that he is increasingly gaining proprietary customers through this approach, where he was previously “only” the intermediary of customers. No matter how you turn it around: The banks will continue to lose customer contact, are pushed further into the background, pushed away by the customer. They do not miss anything and let it happen. Yes, Check24 has to follow the same rules as the banks. The difference is that Check24 knows its customers. The banks do not know their customers.