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Community Bank is an online service created in Madrid in 2009 by two banking executives whose objective is to contact people who need a loan with others who are willing to lend the money, generally small amounts ranging between 3,000 and 15,000 euros, including they can ask for personal loans with Financial Credit Institutions. The platform collects the requests of the applicants and studies their ability to return the loan, and, if they approve the request, they post it on their website and the lenders can collaborate in its financing as well as with personal credits with Financial Credit Institutions.
In principle there are advantages for each other. Applicants can get money at interests equal to or lower than those of the bank, to return in negotiable periods but not usually exceed three years. Lenders get, in theory, higher returns than they would if they invested in traditional financial products. The secret is none other than disintermediation, that is, getting the bank out of the way.
Community Bank, as a pioneer in the State in this business model, has suffered all the vicissitudes of those who start something new and has to make it known. But above all it has suffered the distrust of users in systems that are not certified by banks. In addition, as one of its founders, Arthur Cerdante, acknowledged in a recent interview when they launched the project, they did not expect the country to go through such an acute crisis.
Cervera claimed that, during 2010 and 2011, his partner and he seriously thought to throw the hat on fire in the absence of demand, both requests and offers of loans. However, 2012 changed and the business started to flow slowly. To date, Community Bank manages 80 monthly loans worth 400,000 euros and has received financing of 4.5 million euros from various funds.
What happened between 2011 and 2012 because users started to try Community Bank? In the first place, in August 2011, a drought of international credit to Spanish banks began that lasted two years and caused these banks, in turn, to cut consumer credit and SMEs to engage in business, much more. profitable, to finance the State.
Second, the image of banks among citizens has worsened alarmingly. Before the crisis, a bank was a guarantee for both the borrower and the person who left their money. Now they are perceived as a threat. The word bank is related in the minds of many citizens with images of evictions, groups of grandparents protesting their investments in preferred or bankers friends of politicians hunting rhinos in Africa.
Banks are no longer the sacred cows of credit and, in addition, they do not offer profitable alternatives to consumers or SMEs; they are reluctant to lend and, when they agree to do so, they impose very harsh conditions for the applicant, with high fees and very high interest rates. Therefore, it could be said that they have almost pushed users to platforms such as Community Bank. The rest is done by the mouth-ear, which in the network is multiplied by a thousand with respect to the physical world.
It is not surprising that the success of Community Bank has attracted in Spain projects already existing abroad such as the Investing and the German creditity. Panter entered the Spanish market at the end of 2013 with the intention of opening the private financing of the northern European countries to local credit, always in conditions of particular to particular (P2P). The high returns of this type of business can be advantageous for users in rich countries and, at the same time, new credit lines for Spanish companies and individuals are opened up.
As Panter CEO Pärter Comberg said in his presentation: “In Spain there are more people looking for credit than in Scandinavia”. Panter is also present in Estonia and Finland, and plans to open soon a new subsidiary in Ireland, another country with difficult access to credit.
A similar situation is that of creditity, who arrived at the beginning of February from Berlin with the support of the international business incubator Rocket Internet. creditity seeks to put in contact the lenders of the rich Germany and the Spanish applicants, although it also allows loans between users of the same country.
There are more companies that follow this business model and could soon land in Spain. For example, Wonga, which has received 145 million euros of funding, or Prosper, which has attracted 122 million, which have led to a credit revolution similar to that already caused by online betting. Now, the million-dollar question is perhaps whether the banks will allow internet companies to take over a business that has traditionally been theirs.