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The Business Bank of the Future Looks Very Different for SMEs

In the future, small to medium sized companies won’t just go to the bank for loans and advice. They’ll also expect the kind of fintech solutions that support their business, which several banks have already begun to offer.

When digital disruptor bank Lunar launched it’s business bank account a year ago, it was a simple product with start-ups and freelancers in mind.

Lunar’s goal with their business offering, however, went well beyond their initial product. Over the past year, the digital bank has rapidly added more advanced banking services to the business account, as well as expanding to provide a second kind of business account more suited to SMEs (small to medium-sized companies). And one of Lunar’s most significant advances has been to develop and integrate a range of fintech tools to make finance easier for their customers. These include employee cards with integrated expense management, business loans, accounting software and customer payment management.

As a digital-only bank with total control over our data, we can develop things faster, but for us it’s also about going beyond banking. We offer traditional banking products and services, but we’re also looking very seriously into how we can become a one-stop-shop for fintech solutions so that, along with their bank accounts, our customers can also get all the other financial services they’d usually use,
Jacob Faber, Head of Business at Lunar.

So far, Lunar’s strategy seems to be working. The digital bank can already count 12,000 Danish companies as customers—a number that is increasing steadily by 1,000 per month.

Business banks will play a new role

Established banks in Denmark have also begun to utilise fintech tools that enable the bank to provide their SME customers with a smoother and more efficient user experience.

However, it seems that such banks are also going to play that role the other way around, by distributing new fintech solutions to their customers—something that Danske Bank has already dabbled in.

We can definitely play a role in bringing some solutions directly to our customers. Among other things, we have done this with the payroll system Zenegy, which Danske Bank has also invested in,
Kent Due-Frederiksen, Global Head of Danske Bank Growth.

Due-Frederiksen has observed that the startup segment tends to adopt fintech solutions much earlier than others. In order to build a business from scratch, when you’re trying to scale as efficiently as possible, it’s necessary to be aware of the latest software. He sees this tendency as an indicator of where SMEs are likely to be moving soon.

“There is clearly an untapped potential in the SME segment, who would do well to take inspiration from startups and utilise fintech solutions for their own businesses,” Due-Frederiksen concludes.

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Sebastian Kjaer
Sebastian Kjaer
Sebastian is editor in chief of the Copenhagen Fintech Magazine. As partner and editor at TechSavvy Media he covers the Danish startup ecosystem on a daily basis
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