Scalable shifts gears: Italian IBAN, liquidity at 2.60 per cent and an AI revolution

Scalable Capital is stepping up a gear: it has officially opened its first bank branch in Milan, obtained an Italian IBAN which will enable it to manage clients’ tax affairs directly, and raised the gross annual return on cash deposited in clients’ accounts to 2.60 per cent. With these three moves, the digital bank – founded in Germany in 2014 and one of Europe’s leading players, with over one million customers and more than 60 billion euros under management – aims to significantly expand its reach in what has now become its second most important market in terms of numbers, after its home country, where it has been operated since 2022.

This challenge has been a long time coming, given that the plan had largely been foreshadowed by the founder and Co-CEO, Erik Podzuweit, in an interview with Il Sole 24 Ore at the end of last year, and is based on a number of key points. The opening of the Italian branch represents, first and foremost, a fundamental turning point in overcoming the historical barriers of the Italian banking market, as it enables the establishment of a strong physical presence through an expanded office and a team in Milan, whilst offering greater institutional security for savers by placing Italian operations under the direct supervision of the Bank of Italy as well as the German regulator BaFin.

“Italians’ investment habits are changing rapidly,” notes Alessandro Saldutti, the company’s head in Italia, who cites a recent BlackRock study suggesting that ETF uptake will grow by 50 per cent over the next 12 months, with 1.2 million new investors in Italia. “The opening of our branch offering a managed account service enables us to lead this change, by offering a modern alternative to a traditional banking model that is often outdated, complex and expensive.”

The provision of an Italian IBAN is, in fact, the other key element of the plan, as it aims to break down a veritable barrier – both bureaucratic and fiscal – by introducing an administered scheme, the absence of which usually ends up discouraging many Italians from investing via foreign platforms, such as Scalable. ‘By taking on the responsibility of calculating, withholding and paying tax deductions as a withholding agent, we are effectively breaking down this barrier and opening the door to the vast majority of people who did not want to climb over that wall,’ states Saldutti with conviction, outlining the objective to be achieved with equal certainty: “to double or even triple the monthly number of new customers.”

In this case, the issue relates to one of the defining features of our market, characterised by the presence of over 1,100 billion that remains parked in current accounts, yielding an average return of just 0.19 per cent per annum and subject to gradual erosion caused by inflation. The idea, therefore, is to ‘help Italians withdraw their savings from the accounts where they lie idle and put them to work’ and Scalable’s initiative, which takes effect today to improve the return on liquidity, is also a step in this direction – and is by no means a typical ‘bait-and-switch’ scheme. The rate, which may vary in the future, is in fact calculated on the entire balance, with no limits, restrictions or requirement for a salary to be paid into the account, and is accompanied both by the standard deposit guarantee scheme covering up to €100,000 and by extended protection of up to €500,000 for Prime customers.