Dear Quartz members—
When I was in Denmark last month visiting family, a Danish cousin told me about a 20-year home equity loan she and her husband had just gotten with a fixed 0.5% interest rate. Before my vacation was over, the newspapers reported that Jyske Bank was offering a negative 0.5% mortgage, a mindbendingly attractive offer for Danish home buyers.
Historically low interest rates like those I heard about in Denmark are a key backdrop for our deep dive report this week for Quartz members on the future of banking. Quartz’s London-based future of finance reporter John Detrixhe also looks at the competition from fintech startups, and encroachment by banks located in other regions as he identifies the likely winners and losers around the world.
You can today read our new state of play analysis of the future of banking, an analysis of the big US banks’ forays away from their home turf, and an assessment of whether investors are right to worry about the toll of low rates on banks’ health. We’ll publish more on the topic during the week. And if you’re interested in this topic, please consider signing up for John’s free weekly future of finance briefing email.
TO DISCUSS WITH FRIENDS OVER DINNER…
Here are a few conversation starters from our guide:
- The banking industry is being deconstructed, as a host of specialized firms, many of which are run by ex-bankers from top-tier firms, are taking aim at the assortment of businesses that the leading financial institutions rely on. They encompass investment banking, retail banking, business banking, payments, trading, and research, giving banks a run for their money.
- UK digital bank Starling, founded in 2014, has around 800,000 accounts, about double the number it had in February. For comparison, Barclays has 5.4 million digital only customers, up from 5 million at the end of 2018. Monzo, another neobank based in London, has more than 2 million. Starling and Monzo don’t have branches, but they are licensed banks and have government deposit insurance protection.
- Peer-to-peer lending startups like LendingClub and OnDeck were spending around $2,500 to $3,500 per loan to acquire new customers in 2015. By comparison, a regional bank in New England in 2017 was spending an average of $500 for small business loans under $100,000.
- Card payments have been, and remain, a money-maker for banks, but they face renewed competition from tech firms like Adyen. The Amsterdam-based firm counts companies like Tiffany, Spotify, and eBay among its customers, and it handled €104 billion ($114 billion) worth of transactions during the first half of this year, a 50% increase from the same period in 2018.
…OR WITH US, ON WEDNESDAY, ON THIS CALL
Join us for a discussion on Wednesday at 11am EDT/4pm BST with John and Quartz global finance editor Jason Karaian, where they’ll walk through their reporting on the banks and their upstart competitors. We’ll be taking questions and comments live on the video conference call, accessible at the usual location.
If you’d like to dial in, use the following numbers: UK 0800-014 8469, USA 866-226 4650. For both numbers, the access code is 722 994 440.
OTHER MEMBER CALLS THIS WEEK
On Tuesday, at the usual 11am EDT/4pm BST time, you can join Quartz deputy finance editor Oliver Staley and Jason to discuss Oliver’s reporting on the rise and fall of Six Sigma, the management fad that first gained prominence with Jack Welch at GE. On Friday, at the same time, Quartz reporter Adam Epstein and managing editor Kira Bindrim will discuss Adam’s reporting on making sense of all of the big new video streaming services. (To add our complete schedule of upcoming conference calls to your Google calendar, click here.)
On Friday, we published a new PowerPoint presentation created by Quartz’s newsroom about how to manage your airline points like a pro. Later this week, we’ll publish a presentation about the legal cannabis business, meant to be an efficient way for you to get up to speed on the topic, and a potential source of slides to include in your own presentations. You can see all of our presentations here.
Please send a note to email@example.com if you have any feedback, or suggestions for other things we should cover.
Best wishes for a productive week,
Kevin J. Delaney
Editor in chief, Quartz