December 09, 2022 | Hayley Wahlbeck
We’ve recently come back from a fantastic Nordic Fintech Week, speaking to some of the hottest fintechs in town, and we wanted to share with you some of the things we learnt.
Embedded finance was certainly the buzz word of the week. But what does it mean and how does it link to open banking? Well, open banking enables the sharing of data, and embedded finance builds on that technology. It allows businesses to ‘embed’ financial services into their business model, so all financial services are in one place, making things simpler and more convenient for the consumer. But this isn’t actually anything new. Just look at Uber. So why is it such a hot topic now?
During her embedded finance keynote speech, Leda Glyptis, Chief Client Officer at 10x Banking, explained that what has changed in recent years is that the different players in the embedded finance ecosystem are starting to understand where they want to play in the value chain, and that they don’t have to do it all themselves.
Rasmus Camborda Meilvang, Managing Director and Founder of Plata gave a perfect example of this when we caught up with him at the event: “We aren’t interested in integrating APIs with banks ourselves so as long as there are good aggregators in the market like Aiia, we’ll just stick with that and focus on our core product and optimising the customer journey”.
Anders Hartmann, CEO and Founder of NORD.investments explained how businesses don’t need to have their own licenses to offer innovative solutions, “The core of our company is open banking so we have an open banking partnership with Aiia where we facilitate payments - so open banking is the possibility to make great solutions without having to be a big bankwith big licenses that are so hard to get.”
Anders Riis, Founder at Swiipe Payments, highlighted that open banking provides huge opportunities for innovation, “it allows you to build new innovative services on top of the open banking technology to improve and enhance the buying experience”, which can really change the face of payments. But it’s not only about improving the user experience. Anders said it’s also critical to provide an easier onboarding experience for merchants: “Swiipe is mostly focusing on adding account-to-account possibilities directly to the check-out and providing a ‘plug and play’ option for merchants where they can be live with this in 10 minutes.”
And Anders Hartmann echoes the focus on improving the user journey through open banking innovation, “We’re pretty far in the open banking journey now…and we’re building our own infrastructure, and taking more regulatory responsibility to build a ‘bank-a-like’ infrastructure for a simpler onboarding experience, and to improve profitability for our customers”.
For Rasmus Camborda Meilvang at Plata, open banking is synonymous with opportunity. Opportunities that can be a force for good too, “we want to create solutions on top of open banking technology for the market, where you actually have a concrete service that supports the UN goals for economic growth, and supports financial inclusion. We want to help the poorest people to access money in a better and fairer way.”
Another hot topic on the lips of our fintech heroes was recurring payments. With the consumer’s consent, a licensed third-party provider can initiate recurring payments from their bank account on a continuous basis - which is more convenient for the consumer because they don’t have to go through the authentication process every time, and it’s a cost-effective method for merchants with shorter settlement times and no chargebacks.
It’s certainly the next big thing for Plata, as Rasmus shares, “Now we really want to take on the payments side and integrate payments via Aiia on our platform.”
Rasmus adds that, in the future, he’d be looking for a solution to “integrate the recurring payments which is a big pain for everyone in the industry that we need to solve.”
With recurring payments clearly a top priority for our customers, developing a product to solve this challenge is high on our agenda.
So it’s safe to say that Nordic Fintech Week covered many of the hottest topics in open banking and we can’t wait to see what happens next year!
If you’d like to learn more about how we can help you on your open banking journey, then get in touch.