From APIs to Open Banking and payment networks, the financial infrastructure ecosystem has been developing at pace in recent years. Today’s FinTechs and financial service providers have a vast array of financial infrastructure providers to choose from – making choosing wisely ever-more important.
That was the topic of discussion at a Money2020 event, ‘Infrastructure Providers: How to choose and use them as competitive edge’. Moderated by Yusuf Ozdalga, Partner at QED Investors, the session featured a panel made up of Dev Subrata, CEO & Founder at Fidel API, Roland Folz, CEO at Solarisbank AG, and Claire Calmejane, Group Chief Innovation Officer at Société Générale.
In this article, we’ll explore the key points made by the panellists on how financial infrastructure is changing the ecosystem and driving innovation.
Giant strides forward
According to Dev Subrata, CEO & Founder at Fidel API, compared to legacy banks which are typically built on top of main-frame technology, the challenger banks and FinTechs we see today are powered by cloud infrastructure and “leaping forward.”
“Cloud infrastructure is a great example of where a good infrastructure can set you off at a speed that otherwise isn’t possible,” Dev commented.
Claire Calmejane, Group Chief Innovation Officer at Société Générale, explained that the financial services group had been on a journey rather than a revolution when it comes to utilising cloud-based, open-source technology – with the end-customer ultimately benefitting. “What’s amazing is the results,” she said. “You start to be able to leverage the technology to the customer benefit and to start the next part in your journey.”
By utilising these new technologies, Société Générale has been able to innovate in ways that other large corporates outside of the tech world were not able to, Claire went on to say. “Now, sharing APIs, using the cloud, using AI, is just embedded. That is going to lead to better cost-efficiency and customer experience.”
User experience is king
As technologies mature, providing a seamless customer experience is increasingly vital, according to Roland Folz, CEO at Solarisbank AG. “[In the past two years], to me what has really changed is that, particularly the successful ecosystems, they now understand how important it is to completely seamlessly integrate financial solutions,” Roland commented.
Today, the prevalence of mobile technologies and one-click e-commerce means that there is an equally high expectation when it comes to the user experience of financial products too. “Particularly in the last couple of years, there is no possibility anymore to enforce your own solution within a partner. You basically have to integrate within the value proposition and become part of it, or not,” Roland added.
Good infrastructure drives innovation
The proliferation of financial infrastructure solutions is driving the pace of change in the ecosystem and enabling financial institutions today to work faster and more cost-efficiently than ever.
“There are services for everything, there are APIs for everything, and the combination of all of this is what’s making what would have otherwise taken ten times the cost and ten times the time, now happen at a fraction of that,” explained Dev.
“Competition has now completely changed,” Roland said, adding that in many cases FinTechs and newer entrants to the market are extremely client-centric and much closer to the client than their incumbent counterparts – driven in no small part by their use of low-cost, high-speed financial infrastructure.
Banking Circle is a financial infrastructure provider giving banks and payments businesses access to a range of banking services, including multi-currency bank accounts, local clearing and cross border payments – all underpinned by market-leading compliance and security – without the need for clients to build their own infrastructure and correspondent banking partner network.