There are good strategic reasons for Sberbank to be concerned about the growth of such operations as Tinkoff and Home Credit: and good reason for a counter-attack. Tinkoff, Home Credit and Russian Standard are all at their strongest outside the main cities: regions where Sberbank, as the former state savings bank, has in some cases had almost a monopoly.
"For me the real dynamism in retail is the smaller cities, the frontiers," says Denis Bugrov, Sberbank’s head of strategy. "Historically banks focused on the big cities. It’s in the big cities where most of the competition is."
Point-of-sales lending is particularly well suited to serving the smaller towns: at its most basic it just requires a salesperson and a laptop. "We are one of the few banks that works from Kaliningrad to Kamchatka," says Ivan Svitek, chief executive of Home Credit, a consumer finance specialist with the biggest market share in point-of-sales lending in Russia.
Part of Tinkoff’s success is similarly partly attributable to its use of mail shots, and more recently the internet – as well as a dedicated courier operation – to sell credit to ordinary rural Russians, sometimes even in areas without branches of Sberbank. This is a model that appears particularly suited to Russia.
"You have good internet connections in Russia but it’s a big country and the transport infrastructure is lacking," says Oliver Hughes, Tinkoff’s president.
As Bugrov acknowledges, that ability to encroach on Sberbank’s home ground could be a serious threat. Sberbank’s market share outside the big cities in Russia is more than twice as large as its market share in the biggest cities.
Bugrov says Sberbank is reacting with a programme of branch refurbishment and a new focus on payroll lending and cross-selling. "Unless we do something, they are going to start taking our market share," he says.
In September, Sberbank launched a new point-of-sale bank alongside Cetelem, the consumer finance operation of the French lender BNP Paribas. Cetelem already enjoys around 4.5% market share in Russia’s point-of-sale market.
After 37% growth in 2011, retail lending at Sberbank, Russia’s biggest bank, grew almost 50% in the first nine months of 2012. Even so, despite a branch network of some 19,000 – the biggest in the country – retail still accounts for only about a quarter of Sberbank’s loan book.