Ten years ago, banking for smaller businesses in Russia was a miserable affair.
Even the simplest transactions required reams of paperwork. Getting cash meant queuing in a branch with a cheque signed by the chief executive. Opening an account took a week or more. Payments took days. Customer service was nonexistent.
“Traditional SME banking in Russia was based on a corporate model,” says Roman Zilber, head of small and medium-sized enterprise banking at Raiffeisen’s Russian subsidiary. “Processes were complex and cumbersome – which was fine for corporates, because they have dedicated staff to manage banking, but no good for small entrepreneurs who have to do everything themselves.”
Then at the start of the decade, the IT team at a small Russian bank had a light-bulb moment. While working on an online platform for retail customers, staff at Bank24.ru realized that the product they were building could be adapted for SME clients.
“We started to think of SMEs not as corporates but as individuals doing business,” says Bank24’s chief executive at the time, Boris Dyakonov. “Once we did that, we saw there was a huge niche of smaller firms that was completely underserved by banks, so we started to create a digital product specifically for them.”
