Guest Post #3 – Finance 2.0 in Germany: Ready to take off? (Part 2)

Is the largest German business network  On Xing people and companies can establish open and closed groups, to every possible business topic. Some banks are actively engaged here.In general using closed groups. Banks use Xing also to train social media within their workforce. Xing is suited  for use because many employees of financial institutions are using xing for private purposes. In addition to bank-specific groups, there are many groups that deal with general financial topics, such as a group to the topic “Social Banking

The photo service Flickr is currently experiencing a growing popularity by some banks. So far, the activity is still low. Some banks upload pictures of events and similar occasions. The use is generally not strategically planned and integrated.

As an explanation we should consider the greater importance of security and privacy issues for Germans and their specific fear of loss of privacy. German consumers responds with particular sensitivity to these themes

German Social Platforms  (studi vz, schueler.vz,,
The German-speaking social networks usually didn´t offer  the great possibilities of use and communicaton such as Facebook. Technologicallyt the networks here are not yet mature as they are in the USA Usually you can connect with and talk to other people and create or join groups. Nevertheless, the platforms are actively used. In my SocialFinanceList these activities are not listed up to know, because there usally  no dialogue and no involvement take place.And so the activities didn´t allow any strategic approach.  In addition, the groups more often used by employees of the banks  than by customers. Nevertheless these platforms are heavily used for advertising and little used for dialogue.

Social Media Integration
Although  an increasing number of banks is using social media, there is no established bank that has the courage to integrate their social media activities in their classic dialogue instruments so far. The Social Media platforms run alongside the classical marketing and sales strategies and campaigns. So customers which visits the classical website or the branches normally won´t notice the social media activities. To date their is no well known and traditional german bank with it´s own social media newsroom.
And becaus of social media had´nt become a part of mainstream society so far the average customer didn´t use the new opportunities

New Banks and Bankless Banking
In addition to the burgeoning use of social media, there are currently about 20 companies that might fall in the category Finance 2.0 or can be classified as bankless or at least different Banking. These are new companies – banks and nonbanks-  offering financial services. Some vendors occur as competitors to traditional banks by cutting out banks as a middleman. Others offer finance products and services and by thus they destroy banks traditional USPs.

In general these companies are extensive social media users. They are ableto use this opportunity, because normally they have  no over a long time established and so unquestioned culture.

The company founders and their employes normally are grown up and socialized with the Internet. So they live this culture both in their private and professionall life.

In addition, none of these companies was affected by the financial crisis. On the contrary: These companies offer reasonable alternatives, and try to avoid the errors of classic banks. They are active  wherever there is a growing dissatisfaction with the offers of clasisc banks or where their new ways and instruments can replace outdated, inefficient or even harmful practices. Also the new technologies and the internet in particualar allows the entry of  these new companies  into the finance market, where banks are currently on the road to lose all their classic USP’s

Here is a short overview of the main and most succesful companies in this area:

The Fidor Bank AG is – I suppose – the worlds first community bank. Ficoba offers the most sophisticated and most widley developed approach of adopting the basic principles of the social internet (Social Media) on financial services. For the financial industry they are the answer to Jeff Jarvis question: What would google do? A google bank may look like the fidor bank

Social media or the social web is the key principle of their business model and according to that deeply integrated with vision, strategy and culture. The Fidor Bank AG is developing products jointly with the community members.  The members are well renumerated for their ideas or inputs. They get incentives for a wide range of inputs: Recommendations, contributions to discussions, product ideas and so on. Thus the participants will  become co-creators. Even in the marketing and the communication stategy these principals find their logical reflection

All social media platforms are used extensively and professionally, while the Bank and especially the board members themselves are active without resorting to the assistance of agencies. For this reason Fidor is focusing on a careful growth, driven by the internet and word of mouth.  For Fidor good products and  good ideas are the best marketing, which is the most  promising strategy in the age of the social Internet

Smava & auxmoney offers p2p loans. Smava was among the first Finance 2.0 providers in Germany. Since they started the demand for p2p credits had risen.Today their is  a continuous  monthly growth . With  some positive reports and ratings in the traditional media, p2p lending is on it´s way to reach  the regular people and is accepted as an real alternativ to classical credit products. Since the beginning of the financial crisis smava had registered an 30 % increase of the demand for loans. However more than a niche had not been reached by those providers.
Although established Banks begin thinking on p2p banking currently no one offers the service. Naturally smava uses other social media platforms very actively.

Whofinance is a service where people can evaluate advisors from banks. The bank advisors can create a profil and give clients the opportunity to rate their service quality. Bank customers are also able to evaluate advisors, which haven´t their own profile. The platform is still emerging but is growing slowly.

Consultants, who generate  a contact  and a subsequent sale by using the platform have to pay a commission to the provider. The portal also sells leads. Traditional banks are using this portal very reticent, while new entrants like the quirin Bank are active users. Qurin  regarded  the ratings as an opportunity to establish and show greater customer confidence and therefore increase their service quality and get new customers. Based on the customer ratings whofinance regularly elects the best bank. The well known german Newspaper “Bildzeitung” regularly publishs the results.

Kontoblick this service provides the opportunity of account aggregation. Consumers can have a look at all their bank account information at a glance. Some financial planning tools supports the customer optimizing their financial decisions The service can be classified broadly into the area “Personal finance management”. The accounts of  the major German banks are integrated. For Germans privacy and data protection is very important. So it will be very difficult for Kontoblick to gain the trust of the potential customers. I´m not sure if they have the endurance to handle this situation.

Sharewise is a stock community for people who are looking for meaningful and substantial information about stocks. Here people can exchange ideas with like-minded investors and see who was right in his forecast. In traditional communities can be very abundant stock recommendations, but it is not checked to what extent specific purchase recommendations were successful.

Sharewise is one of several stocks and funds communities that exist in Germany. Some of them are rather playful and have an rather educational character, while others allow the concrete trading. New in this category is a further offer of the Fidor AG called, which offer an entirely new opportunity to participate in equity trading

Social Banks 
Social Media is committed to openness, transparency, honesty and authenticity. In so far banks, which are classified as socially responsible and sustainable,  should be ideally suited for the use of social media.

Some of the social  banks have already recognized this.

Per definition the following german bank can be categorized as social banks: www.kd –,,, www.,

In principle the Volksbanken Raiffeisenbanken and the Sparkassen could be called social banks too, although their business policy isn´t explictly bound to the principles of sustainabilty. But they are rooted in regional economic life in a unique way. Their business strengths lie in a thorough knowledge of the market and personal contact with the people in the region. Both banks supports the cultural and social life of the regional communities.

Social as a trend
I am sure that “Social” will become a trend in the banking industry. Social responsibility will become an unique selling propositions. Every bank will recognize this. Sustainable acting of banks or Social Banking will be a success formula. In this context some banks are really willing to question  their conventional business practices and to renew, together with the people. Other banks will use Social Media or Social Banking solely as a facade behind  which they will continue doing business as usual.

It is therefore not surprising that many banks that use social media don´t have any strategy . Moreover the don´t listen, they don´t understand or even try it, they can´t stop sending and talking to people in advertising language. But hopefully that will change in 2010

Contact Boris
Once again, I invite you to connect with Boris on linkedin, visit his blog, and follow him on twitter

Part 1 – Part 2

What do you think?

Written by Christophe Langlois

Based in London for almost a decade, Christophe is an entertaining fintech marketing keynote speaker and a trusted advisor to the global financial services industry on the topics of digital marketing, innovation and B2B social media.

Christophe has contributed to over 140 events in 18 countries.

Currently, Christophe is advising a number of fintech startups on marketing and growth hacking and he is the Chief Marketing Officer of The Fintech Power 50, an exclusive annual programme helping fintech scale-ups to accelerate their growth globally.

Christophe's views on are his own.

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