Many social banking programs are limited in scope by practicality. The collateral that banks can risk on non-traditional customers is not infinite. These realities, though unfortunate, are inescapable.

Or are they? A new program currently in the proof-of-concept stage at Shinhan Bank Japan suggests that technology can help the industry transcend these traditional tradeoffs and, as a result, increase access to financial services for the un-banked and the under-banked.

Around 2.5 million people in Japan who need cars cannot get a loan to buy one because of their credit situation or personal circumstances. Shinhan’s new auto loan program allows the bank to provide loans to these people by leveraging the Internet of Things (IOT). Cars purchased with one of these loans come with IOT sensors that let Shinhan see where the car is and—if necessary—deactivate the engine of the car.

This allows the bank to collect a higher percentage of cars from bad loans as collateral, which in turn allows it to offer more loans to marginal customers.

The project is currently undergoing a marketplace trial in a designated target area, but it’s been a hit there. Shinhan hopes to reach 1,000 additional customers with this loan once it launches.

The project was also a hit with the independent judges and voters who choose winners at the 2018 Efma-Accenture Distribution & Marketing Innovation awards. Shinhan took home gold in the Social, Sustainable & Responsible Banking category because of this innovation.

Silver here went to DenizBank’s “Digital Change Agents of Villages” project. The initiative is the bank’s latest attempt to boost the economic fortunes of farmers in Turkey, where DenizBank is based.

The project is based around DenizBank’s Agricultural Intelligence app, which provides a range of digital tools farmers can use to cut costs and boost the productivity of their land. DenizBank has also been working with sociologists to better understand agrarian areas of Turkey so it can further improve its agricultural offerings.

Bronze in the Social, Sustainable, & Responsible Banking category went to La Banque Postale for its energy saving platform. This program is a partnership with Economies d’Energies and part of a broader national push to improve the energy efficiency of homes and help France transition to a low-carbon economy.

The free online platform offers helpful, customized advice to French citizens looking to renovate their homes for greater energy efficiency. Users can run simulations of their home’s energy consumption and see how renovations would change it, estimate renovation budgets, find contractors, and access financing to fund the renovation. The platform is part of Banque Postale’s “Bank and Citizen” commitment to helping customers find more sustainable solutions.

Congratulations to La Banque Postale, DenizBank, and Shinhan Bank. Next time we’ll look at the winners of the Workforce Experience category at the 2018 Efma-Accenture DMI Awards.

In the meantime, I wholeheartedly encourage financial institutions from across the globe to submit innovations for the 2019 Customer Insight and Growth Banking Innovation Awards.

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