00:11:07 · Pranav Sood, Medhy Souidi
And now suddenly when they're looking at cost consciousness and margin, they don't necessarily see the value in having all of those. So people like us who can do everything suddenly come into our own. And then I think the third thing that we're seeing a lot of is the embedded finance side of things. And it's really two aspects. So one is bundling. You know, increasingly, software businesses are finding it harder and harder to defend their margins and to grow their user bases. And so being able to bring in financial services on top of software becomes very compelling. You know, a great example of that is Papaya Global. They've done a fantastic job of of this. They're, you know, at heart, a payment software business, but they've very successfully integrated payments and money movement into their proposition, which makes their their use case much, much more compelling for the people that they're selling to. The other piece is, of course, in expansion into new services or new service lines. And, of course, everybody wants to have the the maximum wallet share of the customers. It's very difficult to have that because, you know, there's there's only so much wallet to go go around. But from our perspective as an infrastructure provider, we're delighted to be able to power those use cases because we think it's a great fit, and it makes great use of all of the regulatory licensing and payments infrastructure that we've got and built. [00:12:23] S2: Very interesting.
00:12:23 · Medhy Souidi, Rachel Morrissey
[00:12:23] S2: Very interesting. [00:12:24] S0: I was struck by what you just said about the nature of of this consolidation going on. When you're looking at this... I mean, obviously, Airwalks is in a really good position for this, but you also have a number of partners that you work with. So when you are looking at partners and you're trying to figure out where to go or what to do, what are the kinds of things that you key into? Because as fintech partnerships grow, you're going to either see mergers and acquisitions in this area, or you're going to see, really intense partnerships. And so I'm just curious, what is it you are digging into there?
00:13:03 · Pranav Sood
[00:13:03] S1: Yeah, so we have two different types of partnerships. One is what I would call financial partnerships. We partner with 60 plus banks and FIs around the world to give us access to the products that they have in different markets, whether it's the virtual I bands or physical I bands, whether it's payouts, whether it's whatever. We have that whole network of financial partners. We also work with a lot of, I call, strategic partners. And those strategic partners could be software platforms. So I mentioned Xero. We also work with people like Shopify or WooCommerce and many, many others of that nature. And then we work with more like a bigger platform. So whether it might be something like an Amazon or Google or whoever to find ways to be able to package and distribute our products together to the customers that we want to work with. And then sometimes, of course, we also have other software providers that we're working with. So when it comes to, for example, KYC or KYB, you have to partner with others to give you access to some of the data that you need in order to do those checks. So from our side, partnerships is incredibly important. It's very difficult to scale really quickly unless you can partner effectively because you don't really want to be in a situation where you're building everything for yourself from the get go. When we look at partners, and let's focus on each of those three categories very quickly in turn. Financial partners, it's access to the underlying products and services, but it's critically also the flexibility. Many banks out there will give you access to a particular rail. Not that many of them will give you access via a really high quality API that has fantastic uptime and also has the flexibility that allows it to be combined with other things into a consolidated whole. Strategic partnerships, we're really looking for the mutual value proposition and benefit. I think it's a truism, but it is true. The most successful partnerships tend to be the ones where both parties are benefiting. And so we're looking for opportunities to solve real problems for our partners' customers in a way that generates value for the customer, for our partner, obviously for us as well. Is there is a great example? They have lots of customers who are looking to make payments around the world.
00:15:11 · Pranav Sood, Medhy Souidi
And so if we can facilitate that, that's solving a big problem for everyone, and we're all able to benefit as a consequence. And then the software side, when we're thinking more about our own services, so things like KYB, KYC, again, you're looking for the breadth of coverage. You're looking at the depth of data that people are providing. And crucially, also, it's a very competitive market, so you're looking at the price. And I think the benefit for people like us who are buying at scale is that we're able to bring purchasing power and hopefully negotiate great deals with our partners as well. [00:15:43] S2: Yeah? Acquirer, transact and engage. That's what we say in DBS as well, for example. [00:15:49] S1: Yeah. Exactly. Yeah. [00:15:50] S2: I have a question for the future, but I don't know if you want to do Okay. I can go ahead. What is the future for you for programmatic money? What do you see as a trend and coming in the next couple of months, maybe, or next years?
00:16:03 · Pranav Sood
[00:16:03] S1: I think a couple of things. One is payments, even as they become more global, are becoming way more local. Increasingly people are moving away from SWIFT and equivalents as money movement architecture and moving increasingly to local payment rails both in and out. If you look at our volume of all the transaction that we're doing annually, about 93%, 94% of them are local rails. So local money in, local money out. A very decent percentage of those are same day, about 70%, and then about 50% are actually instant. And so for me, that's indicative of the fact that the world is moving much more towards that local fast and in some cases instant way of moving money. Increasingly, you're seeing people finding ways to harmonize across borders. So Singapore and India, for example, have been doing lots of work to try and make those two payment systems talk to one another. And I think really the the crux of it is maybe the last thing I'll say is that we're seeing more and more people looking to buy programmatic money movement in a modular way. And let me just unpack that a little bit. So I think it bears explanation. I'd say historically, a lot of payment businesses and infrastructure businesses have tried to sell a whole stack of products at the same time to their customers. So it's like inviting someone for dinner and saying, You can have any dish you want for main course so long as it's acquiring. Increasingly, are saying, Look, I need this particular problem solved. I need you to find a way to plug in alongside other people. And we're fine with that. Our view is we need to solve the problem for the customer that they're experiencing today and prove to them that we're good enough to solve the problems that they're going to have tomorrow. But I think that's probably a slight change in philosophy over the last few years and a movement away from locked in ecosystems to much more flexible and hopefully compatible ways of working.
00:17:57 · Rachel Morrissey, Pranav Sood
[00:17:57] S0: What do you think are ways that Airwallix's platform has evolved to accommodate this scale across borders? What are what are solutions that you are finding? [00:18:09] S1: I think the first one is we've scaled a lot. So increased coverage. We can do more markets in terms of payouts. We can issue cards in more places. We can do acquiring with more payment methods. We can do more currencies. So all of that packet of staff relates to just scaling the infrastructure footprint that we'd already started to build. The second is we're increasingly working on new products and services. So for example, we will be launching a yield product to help our customers benefit from the interest rate environment. We will work on credit solutions and things like that as well. And then the third thing is expansion into new sorts of use cases. So as I mentioned at the beginning, we're doing more and more embedded finance offerings. We're helping our customers to be able to not only do banking as a service, but also global money movement and also payments as well, so platform product. As a consequence of that, our product is expanding on multiple different vectors at the same time, which is extremely exciting to see because the speed that we're doing that is not something that I've seen before. It's great fun to be a part of because as someone who's responsible for a meaningful commercial team, I'm always able to tell my sellers that you've got new tools to be able to go and talk to your customers with.