Looking from Tallinn, the difference between the capital and Estonia seems more drastic than reality

Both top managers are themselves good examples of this opposite movement. Holger Haljand acquired a country residence during COVID, and Margus Rink has organized his life in such a way that he often works from his country home on Fridays. However, the companies managed by both men have set business promotion outside Tallinn as one of the focuses of their activities.

“Maybe we in Tallinn are deceiving ourselves with the opinion that life is in Tallinn. I have a country home in Läänemaa, and in the winter life there is perhaps duller, but in the summer it is very intense,” said Rink.

According to Haljandi, the Covid period changed everything that people had thought about working until now. “You no longer have to be in the office for five days, and this change has given a completely new dimension and flexibility both within Estonia and internationally,” said Haljand. “But this assumes that there is also a decent internet connection,” he added.

Referring to the recent decisions of the loan committee of Coop Bank, Rink said that business projects have been submitted from very different regions of Estonia to receive a loan. “Rakvere, Türi, Paide, Viljandi, Haapsalu, Kuressaare,” the bank manager listed and added that compared to Tallinn, volumes are simply smaller elsewhere, but life is also developing outside the capital. “To us in Tallinn, the difference between the capital and other regions seems more drastic than it actually is,” he said.

“We even expect more loan applications from rural areas,” added Rink.

• According to Margus Rink, manager of Coop Bank, manufacturers dominate among business loan borrowers outside of Tallinn. Photo: Liis Treimann

There is another difference between Tallinn and the rest of Estonia. Outside the capital, various manufacturing companies dominate among borrowers. The revival of exporters operating in rural areas has also been observed by Haljand, who says that it was industries that were hit hardest at the beginning of the crisis. There are now signs that the more difficult period is behind the industries.

In addition to business loans and home loans, Coop Pank considers apartment associations to be one of the important and growing customer groups in the near future. “In Tallinn, apartment associations have taken a very big step forward with renovations, and now it is reaching other regions as well,” the bank manager was sure.

Rink and Haljand have different opinions about the supporting role of the state

According to Rink, there is no need for any additional support measures from the state to further push development in rural areas. According to Rink, there are already various support measures in place, and not a single project in their bank has gone unfunded because there is some kind of market failure that should be overcome with the help of the state.

Haljand opposed this opinion. According to him, one supporting measure is missing. Namely, the state should help build infrastructure in such areas where the investment does not pay off commercially. Infrastructure creates the assumption that new businesses, jobs and people will come to live in such areas or not move away. We build the network with our customers’ money, that is, we do it in areas where there are tax-efficient consumers, said Haljand. According to him, the state has started to solve the problem with support measures, but currently it is insufficient to be able to establish good connections in every corner of Estonia.

According to Haljandi, when planning and building different infrastructures, it would be necessary to consider different connections right from the start. If, for example, a new railway or highway is being built, a ready-made communication network should also be built immediately. Currently, different infrastructures are being built independently of each other, said Haljand.

Coop Pank and Telia Eesti operate with their representative offices all over Estonia. According to Haljandi, Telia wants to reach a fully digital service, i.e. it should work everywhere regardless of whether one is physically present somewhere or not. However, this does not mean that the company will move its operations to Tallinn.

According to Haljandi, Telia has created competence centers in various regions of Estonia that help manage and develop the services offered. In addition to sales and marketing, it is important to have technical support on site. The third level is the presence of representative offices in counties. Currently, Telia has a representative office in every county, but this may change in the future, as the importance of physical service decreases and is replaced by digital.

According to Margus Rink, Coop Bank is represented with its offices in two-thirds of the counties, and where there is no office, there are three bank buses driving around. “This system is working well now, and we do not plan to build new offices in rural areas, nor do we plan to start closing our offices,” said Rink. According to him, thanks to technology, all communication with the bank could be made digital, but it is important for Coop Bank to be physically present in the counties as well.

Growing risk

Advances in technology have brought a new and ever-increasing problem to the table for telecoms and banks, namely cyber security. “This is a serious concern,” said Haljand. According to him, the latest research shows that customers are aware of this problem, but still do not deal with cyber security too much. This is understandable, because in difficult times they try to keep the business going somehow and focus on sales and service, added Haljand.

• According to Holger Haljandi, head of Telia Estonia, companies pay too little attention to cyber security. Photo: Andres Haabu

According to him, companies can be divided into three. Larger companies pay more and more attention to cyber security, the second group consists of smaller companies that have themselves become victims of a cyber fraud or attack and have started to deal with the issue after this painful experience. The third group is companies that do not pay attention to this issue and believe that we are so small and therefore not attractive to cybercriminals. “However, this third group is in the greatest danger,” warned Haljand.

“Criminals are very clever. They first make it clear how much the company’s daily turnover is and squeeze out an amount similar to a week’s or a month’s turnover,” added Haljand.

Telia Eesti recently had a case with one of its clients, which was a small manufacturing company operating in a rural area, where they were thought to be unattractive to criminals. However, the cyber thugs managed to shut down the factory’s equipment and demanded a ransom to restart production.

According to Rink, Coop Bank came under the first serious cyber attack in 2019, and it came to the bank like a bolt from the blue. One morning a letter was received that we had to pay a certain amount. We were in big trouble then, but we got out of it, and since then we have invested millions to prevent it from happening again, Rink recalled.

You can listen to the conversation with Telia Estonia manager Holger Haljandi and Coop Bank manager Margus Rink here: