We talked to Matias Peltoniemi on how CrediNord supports businesses, and this is what he had to say about it.
First of all, how are you and your family doing in these COVID-19 times?
Matias Peltoniemi: First of all, I’d like to say that this era has been a severe stress test for all the people I know. As in all the other families, this year has been something different than we could have imagined while sitting at a Christmas dinner table in 2019. Yet, we have managed to adjust to this new normal when it comes to remote working or social distancing. Our close relatives and we have been fortuned to stay healthy and look forward to the upcoming vaccinations. So yeah, a stressful, different, and stretching era this has been and still is. Luckily one can already sense the optimism rising towards 2021.
Tell us about you, your career, how you founded CrediNord?
Matias Peltoniemi: Before CrediNord, I have been within the banking industry for +10 years. I worked for Nordea, a commercial bank, and the largest financial services group in the Nordic region, and one of the biggest banks in Europe. So you may say that my approach has been top-down when working my way towards lending and understanding the vast needs these underserved SMEs hold. That later led to the Co-Founding and CFO role in CrediNord. I’m also responsible for developing our strategic partnerships and investor relations.
How does CrediNord innovate?
Matias Peltoniemi: CrediNord is focused on reinventing business loans to small and micro-businesses. We see this business mainly as a customer satisfaction business. Our innovations tend to be those little things that form the bigger picture of customer and user experience. We aim to innovate around improving and making our products easier to obtain and live with. The customer needs to feel that CrediNords’ services have been so easy to use that they are willing to promote our products to their peers. Shall it be payback options or how we communicate with our customers; it all needs to make the products and services extremely convenient at the end of the day. So innovation happens every day, and it is built on small details getting continuously better and better to form a winning concept.
How the coronavirus pandemic affects your business, and how are you coping?
Matias Peltoniemi: The pandemic sure hit smaller companies harder than it did to larger ones. These smaller companies that we tend to serve are usually shorter on reserves and therefore more vulnerable for black swans like this. At first, we wanted to understand the big picture and how it should affect different sectors. During the first weeks, we were more focusing on helping our current customers rather than acquiring more. Following months we analyzed our portfolio performance and made minor changes to our scoring to proceed with lending activities in this new normal environment. We have found the pandemic environment a great time to partner up with carefully selected parties to sprint when this dark era is over. The pandemic has been precious as it has given us time to learn more about our customer’s behavior and needs and how they change over time and circumstances. This learning curve provides us with the opportunity to come out from the pandemic stronger than ever.
Did you have to make difficult choices, and what are the lessons learned?
Matias Peltoniemi: CrediNord has been fortunate that we haven’t had to make the difficult choices of letting people go. We have had to make the most difficult decisions to slow down new loan originations for a couple of weeks during March and April. Since the virus outbreak was so severe and how it would affect different business sectors was blurred, we made tough decisions. With the current knowledge and experience, the lessons learned is that no matter what the situation is, one needs to look for the grey colors and not think about it so black and white. This way, we could have continued selective growth throughout the spring.
How do you deal with stress and anxiety?
Matias Peltoniemi: I think that I’m at my best when stress levels are high and the environment is challenging. To successfully manage a high growth startup in an environment like this, it is vital to have a stellar management team to rely on. With shared trust and recognition of each individual’s expertise in the team is something to build on in times like these. No matter how fast your company is growing and how challenging the times might be, there should always be room for private life outside work to recharge. Personal life consists almost entirely of family life, my wife, and two small children, who give me the perfect contrast to work life.
Who are your competitors? And how do you plan to stay in the game?
Matias Peltoniemi: Our competitors, in general, are all the financial institutions offering business lending in Europe. There are some Pan-European players but typically more local ones. This also draws the picture for us how to stay relevant. Business lending for SMEs is used to see as a local business. We aim to turn it from local to global by focusing on standardizing the products and making the user experience convenient. This core idea is also the one that determines which products we develop since they all need to have the same scaling capabilities. I think this is something that works no matter what’s your business. If you standardize your product, understand the customer, and make the product or service more comfortable and convenient to use, you can grow from local to global. When the product is better than your competitors, then it is all about distribution. I think the fact that customers are moving online means that there is much potential for new and innovative players to find new customers because it was not earlier possible. We operate already in four different markets. On our way to becoming a global player, we have set our growth strategy for Europe, and many countries are waiting to open during 2021.
Your final thoughts?
Matias Peltoniemi: I’d like to end this by saying that this unprecedented era has already taught us a lot and most probably will continue to do so for a while. From a startup point of view, my take-home message would be that no matter what, know your customer’s needs and keep innovating and developing. For us, that has always meant balancing between helping as many customers as possible while doing it sustainably so that we would be able to lead the game in the future; if you want to win the game, small innovations matter.
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