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Tag: Fintech

12 Strategies to scale up your innovation into a Business Empire

12 Strategies to scale up your innovation into a Business Empire

Million ideas to boost your business but where to start? Starting a business is a wonderful idea. We all learn so much from life, school and work that most of us have a great understanding on how to add value. If you can solve a […]

An Open Letter to the Elite Davos Gang chilling on top of Maslow’s Pyramid

An Open Letter to the Elite Davos Gang chilling on top of Maslow’s Pyramid

Message to the Global Elite: Make Investing easier I have lived a decent privileged life with family in India before starting a new life in Italy from scratch. My interactions with people across the economic stratum allow me to understand a few different perspectives of the […]

Indian’s opinion on Italian Banking Crisis: Simple Observation

Indian’s opinion on Italian Banking Crisis: Simple Observation

Italian Banking Crisis: how to improve?

Looking at the Italian banking crisis with some seriousness I made certain observations. I hope to take advantage of living in Italy for 6 years graduating with a Masters in Finance. Comparing Banking in Italy with Banking in India I can make some constructive blog talk.

My basic experience with having a bank account in Italy is understanding how complicated it can become to get a bank account as a foreigner in possession of limited documents. In the present example, I was just accompanying an Italian citizen in the Christmas week.

As a student, you may get help from you university to get an account. While you work, you may be asked to get certain documents like the Italian Identity Card with an address proof. “Know Your Customer” or KYC is important but there seems to be a lot more other reasons keeping depositor’s money away from the banks.

Banking in Italy during the Holiday season: Error!

Two days before Christmas, I walked in to the nearby Unicredit and Intesa Sanpaolo, with a freind hoping to create a bank account quickly. Unfortunately, the staff at both these places acted so overwhelmed with work. Not only didnt they decline helping us that day without an appointment, but they really didn’t seem that keen to invite us an other day.

The only thing they seemed to care was to get us away for an other day, with the Unicredit manager inviting us after a week. The Junior staff in charge of secretarial work seemed more friendly, while the senior officials in charge of opening bank accounts seemed to always want their sweet time in creating a silly bank account. To think that no bank accounts would be opened for more than a week is quite shocking.

With the banking crisis, this is the last thing I would expect to see. On one hand Indian PM Modi makes citizens eat dirt when everything seemed to be ok, while on the other hand we see Italian Banking on a holiday during the festive season in spite of a looming banking crisis.

Not asking employees to be denied vacation time, but I am sure that an activity like opening accounts can be facilitated in such a manner in order to compete with the Italian Postal Service, who give out prepaid cards in a jiffy even 2 days before Christmas.

Simple observations on Italian banking by an Indian

Instead of aiming to serve low income individuals who may nonetheless maintain some account limits, Italian banks seem to hold the door wide open for their competition, the Italian post. Have not been a big fan of the Italian post earlier, but I do get the feeling that it is improving in the right direction. They have adopted mobile payments.

Supposedly, you now have free wifi in a lot of Italian post offices too. Was also interviewed by a marketer who seemed really interested in my opinions on some of the postal services. You just get a good vibe that they are doing something right.

Intesa San Paolo evidently seems to have made big major changes to their website and offices. Appreciating the great makeover, my bank account with Intesa Sanpaolo is of the Superflash category and it continues to serve me well with very limited charges for use in Italy. The normal bank accounts in Italy always seem to come with large costs.

Unlike in India, where I would be paid a savings interest, In Italy I was expected to pay a big amount as fee for most normal saving accounts. Obviously, keeping my money in a Bank Account is only a way for me to keep it secure. I don’t get anything else in return for my parked money.

Future of Banking: Fintech and Robo Advisors

But, I never had considered the other alternative of loosing my deposits in case of bankruptcy of my retail bank. As a depositor, a certain amount of money is insured. But a higher amount can be under considerable risk. As depositors are looked upon as share holders instead of bond holders.

Saving money in banks in Italy some how doesn’t seem like a favorable option. Rather unfair, in days of Fin tech and peer to peer lending. You can make more returns from alternate investments these days. They would see a further rise when banks cant make bigger returns from the deposits.

As we peer lend to who we trust, Banks may just serve us in providing advice and we the people would finally get to decide where our savings would go. The rise of Robo Advisors will make banking more lean as an organization. Banking employees will have to contribute in some other way.

Suggestion to increase deposits and investments

Italian banking needs to expand depositor base, every euro counts and needs to be rewarded with a better savings rate.  Time for the legislation to reward small savers. Need to get competitive with peer to peer lending, gambling etc. Need to encourage a savings culture among the young.

Immigrants hold considerable amount of liquidity that lies unaccounted. Utilized away from the system not returning gains as investments. Banks need to provide opportunities to allow small amounts of cash to enter the system.

Money entering in terms of deposits by providing a small savings interest rate would nonetheless be a great deal.  Much better than the other financing available from foreign banks.

Time for Digital Italy

Reforming the banks to make an account opening and deposit process as efficient as possible will go a long way. Encouraging digital payments will allow banks to leverage on easy deposits and credits.

Unfortunately, mobile payments is still a recent trend that is yet to catch up in Milan. On the other hand, many Indians cant ignore mobile payments now, doesn’t matter if they have a mobile or not.

 

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What is FinTech and Digital Currency? Should I buy Bitcoins?

What is FinTech and Digital Currency? Should I buy Bitcoins?

How can FinTech help you make money? FinTech refers to an industry composed of companies using innovation and technology to compete with traditional financial institutions in the delivery of financial services. They are easing payment processes, eliminating fraud, saving costs, increasing financial planning, thus benefiting the Financial […]

Want to retire early? Build your Financial Fortress today!

Want to retire early? Build your Financial Fortress today!

How to plan your financial future?   This Blog is going to discuss conventional retirement planning with a millennial friendly accelerated retirement plan, so as to feel richer and secure earlier in life. To think about it, if your are in your late 20s and early […]

Digitalization: All the crazy stuff in the world points to one direction

Digitalization: All the crazy stuff in the world points to one direction

All political hype is just to boost digital content?

 

Uncertainity is a boon for start ups?

All political hype is just to boost digital content?

The media is a powerful tool but can be bought. The internet on the other hand creates a chaotic environment that is difficult to be censored or silenced for now. Information over the internet spreads like wildfire.

Ever since, I started writing my blog, I have had frequent new visitors. A few of them did return to read more. I may have disappointed them with lackluster content written in bad English, but I am really hoping to do better.

I usually get very distracted by our politicians these days. With Brexit, Trump, Modi and Kejriwal re defining dialogue and adding more content to our boring lives.

I hardly watch films these days. Real world has so much more going on then what our most creative minds can bring out as entertainment. How real is this real world, or am I just writing a blog about a scripted reality show organized by our governments?

Whatever it may be, from the recent demonetization exercise, I have realized the importance of being more aware about politics as it can have a big affect on your future wealth and happiness.

The people most happy with this are those rooting for start ups like Paytm

Digital India: The not so obvious solution for a massive task

Digital currency can solve lots of problems for India. Apart from expanding the tax base, the future should ideally be less corrupt and efficient with all digital transactions. The idea of creating chaos to drive people towards fintech is not very cool though.

Its like my dad teaching me to swim by pushing me in the deep end of the swimming pool. Since, we talking about money here, the start up community should have create an organized effort to educated new user base.

My guess is that all the political rhetoric we hear about, from superstars like Modi and Trump is aimed to boost social media usage and digitalization.

 

Ask questions, its a great habit, download now!

The FinTech Book: The Financial Technology Handbook for Investors, Entrepreneurs and Visionaries

FinTech: The Beginner’s Guide To Financial Technology (English Edition)

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