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Why The Old Banks Are Losing The Game To The Internet Loans

Updated on February 22, 2015

Today more and more people, for quite many reasons, do not even think to apply loan from an old bank. They turn to the internet lenders, or actually the internet lenders turn to them.

The Old Dog And The New Tricks!
When we ask, what has happened, we have to look at two things: the digital revolution and the Internet. It is amazing, how the digital world differs so totally from the traditional world! And especially as to the attitudes.

The digital world is totally consumer driven, which is a must, and the traditional world supply driven, where the consumer is just a nuisance!

Old Banks Are "Easy Life Lovers"!
They love the world, where nothing is changing. It feels so secure! This attitude guides their attitudes and they just refuse to admit, what is going on outside the thick doors of the banks.
Why? Because it differs so much from everything, which is holy in their world.

1. The Digital Revolution And The Intenet Changed Everything - Besides The Attitudes Of The Banks!
Actually the big question is NOT about the technology, it`s about the human beings and about their attitudes: do you care about the consumers` needs or not?

2. The Borrowers And Their Needs Have Never Been Important To The Banks - And Now They Have To Pay For That.
This problem has historical roots. Especially in certain countries, like here in Finland, the finance market was long extremely restrected and controlled by the state.
This meant, that there was no real competition between the banks. And more important: what this situation meant to the attitudes?

3. In The Internet The Lenders Must Honestly Serve The Borrower, Because The Borrower Can Easily Compare The Offers.

And what has happened?
These new digital age lenders have responded to the consumer needs and created great products for different consumer needs: Peer2Peer Loans, Payday loans, borrowing with SMS etc.

So we can ask, whether this development is good or bad? The answer can be found from the success of the online loans.

We can also feel, that all this is just a beginning. More and more financial services will be moved to the Internet, where the consumers actually run them by themselves at whatever time of the day and at whatever place they are.

We can just say, how interesting and beneficial this all is to all of us, to the borrowers and to the entrepreneurs.

Juhani Tontti, B.Sc., is a proven loan market expert, who has a strong experience also from the brand marketing, advertising and from the loan market. You can follow his ideas at his blog: Lainaa


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