To level the playing field between small savers and investment professionals, Swedish fintech Njorda has created an app that lowers the knowledge threshold needed to make smart investments – helping users compare risk, reduce fees and maximise their returns.
With a combined 40 years’ experience building some of the most sophisticated investment platforms across the globe, the two founders of Njorda know more than most how complicated it can be to make sound investment decisions.
They saw how the open banking movement was changing financial services, and could see a significant divide between the great investment advice people could get at private banks versus what was possible for people to achieve by doing their own research. This inspired them to take the investment technology they were building for large corporations, and put it into an app that everyone can use.
Investment data currently sits outside the scope of what third parties can access under PSD2, so Njorda needed to find a partner to help them bring users’ investment data into the app before their algorithms could get to work.
By teaming up with Tink, Njorda created an app that lets everyday investors gather their savings in one place. Tink’s tech is used to aggregate people’s investment accounts into the app in an instant, allowing Njorda to analyse the information and give users an immediate overview of their investment position – including exactly how much they are paying each year in fees.
From here, the app shows users which funds are similar to the ones they invest in, and if they could save on fees or increase returns by switching. For example, there are a bunch of funds in Sweden that track the same index, but the fees charged vary significantly (from 0.2% to 1.2%) even though the funds are almost the same.
If users want to switch funds, they can road-test new investments in their portfolio before they buy, and overlay market ‘boom or bust’ conditions – seeing a forecast for best- and worst-case scenarios.
By using Njorda, users can get an investment overview that isn’t possible by logging into separate accounts. The app gives users a clear, whole picture by letting them see easily how much exposure they have to each market, and even add information from investments other immediate family members have made.
For many people, it’s virtually impossible to make sense of the investment market and have the confidence to trade assets. It feels complicated, the fees can be opaque and people don’t want to screw it up. We have busy and stressful enough lives already – we can’t all be hedge fund managers on the side. In Sweden alone, National Auditors reported that in the last seven years, 29 billion SEK (over 2,5 billion Euro) were wasted by people making bad pension investment decisions.
This is where Njorda sees its mission: it’s less about micromanaging everyday spending and more about maximising the bigger picture.
Speaking at a recent Tink event, Njorda’s CEO Daniel Roos said: ‘We don’t care how much coffee people are buying, we care about how their investments and pensions are performing. Our mission is to level the playing field by giving everyone access to the best technology – to make complex decisions simpler.’
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