With Monday’s announcement by the Central Bank (BCRA) that guarantees that the interest rate will maintain a floor of 62.5%, the monetary entity seeks that the banks raise their rates of the fixed terms, which it considers to be low, with the objective of making them more attractive for investors and thus contain the dollar’s escalation. Some entities raised their yields and were on average just above 40%, while Banco Nación, which had it at 45%, responded quickly and raised annual interest to 48%, and ranked as the highest figure between conventional entities.
Meanwhile, digital banks make the difference with surpassing rates
Wilobank, the first digital bank in Argentina, which started operations in the middle of last year and offers the same services as a traditional entity but always online 24 hours, was ahead of Friday last week when it noticed that the Leliq rate had closed above 68%. That same day, the entity founded by Eduardo Eurnekian marked an important increase that placed its annual nominal rate (TNA) at 50% for fixed terms of between 30 and 59 days.
“We thought we should hit a sharp jump. The BCRA had questioned the system on fixed terms, and if the Leliq is at that rate, it does not make sense that the banks pay less, “Guillermo Francos, president of Wilobank, told El Economista. the subscription to this product is growing very strongly. According to Francos, the total amount in fixed terms in Wilobank this month grew 82% with respect to the figures recorded in March, and explains that this is due not only to the TNA, but also to the growth in the number of clients, which is currently located in almost 40,000 and expect to close the year with more than 100,000.
Brubank, the second bank in the country without branches
For its part, Brubank, the second bank in the country without branches, which operates entirely from a smartphone, and started operations earlier this year, yesterday decided to take a slight advantage to Wilobank to be the entity with the highest rate, and set it at 50.5%. From the entity led by former President of Citibank, Juan Bruchou, they assured this medium that they currently have 11,000 subscribers, more than 18,000 that are on the waiting list for their subscription request and expect to close the year with 50,000 clients.
Attracting customers
“We need to attract customers and one of the ways is through the fixed term” said the Economist Stefano Angeli, Ceo de Rebanking, the digital proposal of the Transatlantic group that will debut in May. “Although we do not know how much the TNA will be at that moment, the idea is to be above the traditional banking, to the same line as the other digital banks,” Angeli said, noting that another of the benefits they will offer is that the savings bank will be remunerated. That is to say, the money that the client has in the savings bank will be giving a return, as Wilobank does, which for this has a TNA of 20% on the daily balance.
Digital bank, the most important factor
“Today it is tautological that digital banking has to give a higher rate. It does not make sense that he has the same interest as the traditional one” Ignacio E. Carballo, director of the executive program Fintech & Digital Banking of the Argentine Catholic University (UCA), told this newspaper. According to the specialist, digital banks have several comparative advantages over traditional banking. The first one is that entities that operate under the 100% online modality have much lower fixed costs, which allows them to be much more competitive with prices.
Another advantage they have is that, while traditional banks have a much longer process of authorization and before leaving the measure has to go through different divisions, the digital bank has a much smaller structure and can make the change expressly, even the same day. However, Carballo points out that these types of entities, being small and very new, are not very likely to “arbitrate rates”.
Also published on Medium.