Instabank sets new standard for rapid establishment and nordic growth
Through digitization, a new banking segment has emerged, including the Instabank digital bank, which has taken Norway and Finland by storm in a short period of time. From the start of the project to opening the bank it took only half a year - it is a new record and a milestone in Norwegian fintech history.
Instabank wants to deliver products that are easy to understand, based on a modern banking platform, with simplification and customer focus as drivers.
-When Eivind, Gard and I decided to start a new bank, we agreed that it should be a forward-looking bank based on modern principles of an open organization that seeks customer contact and partnerships, says CEO of Instabank, Robert Berg.
“We are here to remove barriers – we don’t think like a typical bank, but as customers"
Together with fellow entrepreneurs Eivind Sverdrup and Gard Haugen, Berg has been in the banking industry for a long time. Their common starting point was the need for a digital bank that simplifies banking services for customers.
-Our concept is to run a bank by thinking like "you“ and hence deliver the best solutions and products to our customers. We have no plans for complicated savings products and services where the product terms and costs are unclear, Berg continues.
Speed record with Banqsoft
From the start of the project until Instabank acquired its first customers, took only six months, which Berg believes it’s a new record:
-We have experienced the fastest growth from being a start-up compared to all other banks in the segment. After only one year in operation, we had NOK 1.1 billion in lending and more than 10.000 customers. We went break-even after just three quarters – which is a new record. The speed of delivery was secured with Banqsoft as our system vendor:
-Speed is in our DNA. In addition to our pursuit of simplicity for customers and partners, it is in many ways what defines Instabank and differentiates us from all the others. It's amazing to see what we can achieve together with a partner like Banqsoft in a short time, "says Berg.
"If you manage this, it will be a new Norwegian record"
Liv Freihow, Director of Business Policy in ICT Norway, is impressed by what the two Norwegian companies have gained:
- This is an example of world-class fintech. Technology makes it possible to start up complicated banking in a few weeks. Here it’s a great potential for exporting Norwegian solutions, "she says.
Instabank chose Banqsoft for many reasons
-We are very pleased with our cooperation with Banqsoft. We chose them because they have a competent and dedicated organization.
The "Insta team" consisted of key resources dedicated to us. They understood our platform and who we wanted to be, offering a collaboration that matched our expectations for speed, flexibility, stamina and rapid expansion. We demand a lot from our partners and we are lucky to work with such skilled people as we feel the Banqsoft team are in line with our own team, says Berg.
He also highlights Banqsoft's ability to turn around quickly, rather than taking lead in brand-new technology:
-We challenged Banqsoft heavily at delivery speed, and they really met our expectations. They can take lead in their segment by assembling existing components in a new way. The major locomotives can take care of labs and research in the industry, while smaller players like Banqsoft must solve daily challenges. Innovations take place because of close contact with customers, unlike major players.
Launched in Finland
After 12 months of operation in Norway, Instabank launched their services in Finland in November 2017. Another Norwegian record, this time within geographic expansion. It only occurred with a marginal increase in the number of employees in Norway.
-It was an important milestone to launch Instabank in the Finnish market as the first country outside Norway. Also in Finland, there is a need for small niche banks that can challenge the big banks with simple and honest products. This is a venture with great potential, Berg believes.
Tone Grotmoll, Country Sales & Marketing Manager in the IT company Banqsoft, is also proud to be in the challenging position:
-The fact that we get business across national borders in such an efficient way is completely unique. Just like Instabank, Banqsoft is a small challenger in our industry. We are an entrepreneurial company that strives for close entrepreneurship with customers who want a lot. Banqsoft has over 200 employees who only work with banking and financing products and solutions. We want to be experts within our core business, and do not try to solve anything else that others can do better than us. The fact that we, together with Instabank, succeed in such a ground-breaking delivery, is a result of technology, expertise and a willingness in both companies to achieve the "impossible," says Grotmoll.
For Instabank, it was an entirely natural choice to continue collaborating with Banqsoft when Finland was coming up:
- It was unacceptable for us to choose someone other than Banqsoft in Finland. They were basically chosen because we knew they could grow with us in several countries. We were pleased with the setup of Instabank in Norway and Banqsoft impressed us further in the Finnish project. The entire project was delivered well within the schedule, with quality and well within the framework we had defined, says a satisfied Berg.
Think big – act small
Grotmoll in Banqsoft is committed to innovation, and to make the complex as easy as possible:
-Unlike traditional core banking systems, our "Bank in a Box” concept has scalability that makes it possible to start with one financial product and grow with new products or in new markets over time. You can look at it like a menu where you can choose from a wide range of products, value chains with or without self-service solutions and delivery models from a simple software delivery to a full ASP model. You only pay for what you use. With this way of working, we prove that we are an up-coming fintech company.
-Both Banqsoft and our customers are growing rapidly, and it's fun to see that our “Bank in a Box” concept allows banks to establish themselves at record speed and grow with new products or to new markets in even shorter time. This shows how important fintech is for the banking and finance industry and how we as an IT provider can make banks succeed across borders without major and costly projects lasting for several years. «Think big - act small» ends Grotmoll.
Liv Freihow in ICT Norway also sees how the smaller challengers can benefit from technology advantages:
- Challenger banks that are established these days have a magical advantage over traditional banks. They can start from scratch with brand-new technology at the bottom, and do not have to bring a "spaghetti" of old IT systems and platforms developed over decades, and therefore can be up and running in a brief period of time.
Breaking down barriers
With a vision of creating the best customer experience and a mission to remove barriers in the banking market, Instabank has set their ambitions high. It does not scare the CEO:
-By always moving and never being satisfied, we remove barriers and launch new products. We are a young bank with strong digital minds and an experienced management team. That means a lot of expertise in a small organization. We choose to focus on a few areas, deliver them well and then expand geographically, "says Berg.
Instabank is looking at expansion to several European countries in the next couple of years, playing with the idea of expanding the product portfolio:
-Today we offer consumer finance, savings and insurance. It is natural to think that a payment solution is next on the list. Norway will probably be where we test new concepts and products, and what works well here will also grow in new markets, "Berg concludes.