The “Smartphone Bank” of the 21st Century
The race for real-time digital interaction in financial service is really heating up. After the 100% digital “online-first” banks of Fidor AG and Atom Bank, we are now seeing the first ever “mobile-first” bank, or more accurately a “smartphone bank”. Number26, a 2 years-old start-up from Germany who in April raised their first significant round of VC fund from Valar Ventures (10 million Euros), is the first to coin the term, and is promising to completely change the usual banking experience with current accounts.
If you have always been unhappy with the sheer time (and efforts) it takes to open up an account at the local high street bank, a Number26‘s “smartphone-only account” might be the answer you want. The firm claims to offer an average of just 8 minutes to open an account by essentially streamlining the cumbersome paperwork (the “paper-based minefield”) and verification process to a 5 minute experience on your (smart)phone. Your records are simultaneously updated to the bank’s database as you input them, and at the end of the process you just need to answer a video call to make final identity verification.
Other interactions with Number26 are also made on the phone, and in real time. Transactions shows up on the app’s statement right after you’ve requested one, as Number26 updates the user’s view of the payment getting processed as they themselves see it. You can block and unblock your card immediately, with a simple button – very much helpful if you were to misplace your card and want to temporarily block its usage when you go look for it. The experience is indeed very app-like, and you wouldn’t need more touches to use your card than you would texting someone. Other smartphone functionalities will also be leveraged as well, for instance your GPS locations can now be used to verify against the use of your card, alerting the bank of any potential identity theft or fraud attempts.
In a time where many of us have access to connected smart devices and are constantly interacting with them 24/7, it ‘s natural to be accustomed to their real-time and zero-delay responses. As such, we gradually expect similar level of responsiveness in our other interactions, banking being a prime target. Innovators such as Number26 may require some more time for large scale adoption, but nonetheless serve as another strong reminder (and perhaps warning) to the legacy-trapped banks on how easy it is for technology to rationalise financial services. .