Fintech makes the world go around

Nov 2 2018   7:44AM GMT

Fidor Bank to separate from BCPE after short marriage

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French banking giant BCPE is selling challenger bank Fidor which it acquired In July 2016, to accelerate its digital transformation.

The short lived coming together reflects the challenges faced by traditional banks that try and buy their way into the digital banking, without a compelling business strategy.

Read Chris Skinner’s blog post about the latest at Fidor

Fidor, which was launched in Germany in 2009 and gained a banking licence in the UK in 2016, was an early challenger bank. It quickly gained momentum, through its disruptive tech driven business model, before being acquired by BPCE.

At the time BCPE chairman, François Pérol, said: “This is a key step in the acceleration of the digital transformation of our group. It further demonstrates our commitment to innovation, to developing a customer-centric approach enabled by digital banking technology, and to be more involved in the digital and mobile banking field.”

BCPE has over 35 million customers, more than 100,000 staff and thousands of branches in France,

But Fidor is now up for sale as things haven’t quite worked out as planned.

One source said BCPE never really had a strategy on how to take Fidor forward.

BCPE is the result of a merger of two centuries old French banks, and as a result its culture was not able to truly integrate a company like Fidor.

Chris Skinner, chairman of the Financial Services Club and fintech expert has followed Fidor since it was formed. He told Computer Weekly the sale by BCPE is a warning of the difficulties facing traditional banks moving from offline to online banking.

“This shows the difficulty of bringing traditional old banks into the digital age because there is a clash of culture,” he said.

Fidor could be targeted by tech companies looking to get into banking as well as other challenger banks that want to scale up or another traditional bank that feels ready to take a giant leap into true digital banking.

Fidor was an early fintech player and offers a retail banking service as well as its open-technology platform to other banks as a service.

In its own banking service, Fidor uses social media to overcome the cost and complexity of traditional banking, and increases customer trust through an online community.

Through an application programming interface (API), it enables third-party financial services to plug in to its system. This means current account customers can access many different services and can deal in foreign currencies and precious metals with the same current account, for example.

Read more about Fidor Bank

Computer Weekly talks to the man behind the digital challenger bank recently acquired by French retail banking giant BPCE.

Fidor Bank is the latest challenger financial services firm to start operations in the UK after the German company announced its UK launch.

Spanish broadband and mobile operator ready to offer financial services via O2 Banking using the technology of startup Fidor.

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