Fintech Insider Podcast by 11:FS
00:12:44 · Sarah Kocianski, David Barton-Grimley
And again, moving money across borders, you're going come up against different rules and different regulations, and that's going to add further complexity to any of your kind of financial dealings. The one thing I would say that kind of, again, from kind the work I've done in this area that to be borne in mind though, and again, this touches on Val's point, is everybody has their jobs to be done. Treasurers are people who know what retail banking apps look like. So they almost... Their expectations are are change... Are changing in time with that. They sort of think if I can do this at home, if I can do this with my personal accounts, if I can use Ys to manage my FX, if you like, you know, to take that as a very simple example, why can't I do it at work? And I think that that is... The the bleed over is happening there, that the expectations of the people who are working in these finance departments is changing. [00:13:31] S0: It's so interesting, and I think you're right. It's gonna vary so much based on the size of the company, the sector, the geography, all of this kind of stuff. So, Pranav, I'd love to come to you about this and and and talk a little bit about how digital, are commercial banking customers really? I mean, so what what would you say is a typical type of customer which uses the services that Airwallex provides?
00:13:54 · Pranav Sood
[00:13:54] S2: So I think we go after a very similar type of customer to the ones that Oak North address in the sense that we're not so focused on the S of SME. We're much more interested in businesses who are operating at a slightly bigger scale, who have a global footprint, who are collecting or sending or spending money across borders, and who are exposed to some of the friction in doing so that Sarah mentioned as well and some of the legacy systems and processes that their existing banking providers will have put in place. I think the interesting point is the one that Sarah mentioned as well, which is that business owners are people and consumers as well. And so they feel and they see the advancement that is happening in consumer space, and they understand some of the changes that can happen in terms of ease of use and UX and UI that world and expect it the b to b side as well. But what's always interesting to me is just how little some quite sophisticated, business, CFOs or or treasury directors, how little they actually know about the way in which their money is moving around the world. And that manifests itself in a lot of different ways. So it manifests itself in the idea that, you know, they think we have to absolutely go and travel to America if we want to open a US bank account. Well, actually, you don't anymore. You can work with providers like us who can do that for you. Or guess what? I don't really understand how much my payment provider is charging me for FX because it's all bundled, but that's always how it's been. So that's always how it should be. And so it's a sort of paradox in the sense that people are becoming more and more attuned to the possibilities, particularly when it comes to user experience and and and and and kind of ease of use, but they're not necessarily being as clear about or as well educated on some of the differences in how people can now do things versus how traditional banks have done things in the past.
00:15:46 · David Barton-Grimley
[00:15:46] S0: Valentina, are you seeing something similar your side?
00:15:49 · Valentina Kristensen
[00:15:49] S4: Yeah. Exactly. And I think, you know, I mean, you know, Sarah, you mentioned about some of these businesses having large payments to make. So again, you know, you think about contextualizing things for the customer. You know, if you're a property investor, the chances are you're making very, very large payments in one go fairly often. Now most banks will have, you know, for regulatory purposes, they'll have a limit in place that if you want to transfer a certain amount, then suddenly it sort of raises a red flag, and then they have to go and do additional checks. Now, unfortunately, sometimes those checks can take several days, if not weeks to go through. And if you're a property investor looking to sort of get your next deal off the ground, you might be on a fairly limited timeframe, then that's really not going to work by, you know, having a bank that's sort saying, well, we have to go through these various checks and balances, and we'll kind of come back to you and then you call up and it's someone different the next time. Another example is with SME house builders or property developers. Often when you're building, you're going to build your next project, you have to set up a special purpose vehicle. And that special purpose vehicle needs a separate account. You can't just put the money into your existing bank account. So it's all good and well that a bank may make it now easier for you to open an account. Near banks make it fairly easy for you to open an account fairly quickly. But if you're in that business, you need to open perhaps multiple accounts. And again, you don't want to have to go through a lengthy due diligence process, lengthy AML, KYC checks when you've kind of already got an account with the bank, you kind of want to be able to kind of be fast tracked and get your SPV account set up so that you can then start working on your next project. Equally, you might be a cash flow business like a restaurant or a hotel versus a cash flow business like a nursery, right? And a nursery knows exactly how much money they're going to have based on the number of kids that they can accommodate, and exactly how many hours, how many are full time, part time, etcetera. Whereas a hotel or restaurant isn't going to necessarily know how many customers it's going to have day in, day out.
00:17:45 · Valentina Kristensen
So that's why context and contextualizing your offering is so important for each customer. You know, it's not this sort of broad brush, Oh, well, these are the products and services we offer. That's our offering. You have to go away and figure it out for yourself. It's trying to really understand what are the pain points and jobs to be done for each customer, and then working backwards from there.
00:18:05 · David Barton-Grimley
[00:18:05] S0: And and and I suppose that counterfactual to, you know, innovation and and digital services, to use your example of a nursery or a property developer. These needs are so niche, and these organizations, in some cases, are so are so complex. Sometimes when I speak to commercial customers, they say, yes. It's, you know, I'd love to be using all of these systems, which you know what the spreadsheets that I'm using are actually just working. And the banking relationship that I have at the moment is is is is kinda fine. And you know what? Maybe I know that banking manager already, and I've known them for a very, very long time. So where does the... Where necessarily does the does the impetus for for for change come from? I mean, we know we know there is. So we've been talking a lot about things like cross border, cross currency with with, kind of, what you're doing at at AirWallax. But I'm I'm keen to talk a little bit about who is leading who, and is there any is there any subsector where you're seeing the biggest growth where, you know, whether we're thinking about Oak North or Air Wallachs where the bank or the fintech is leading the customer and saying, hey. These are all these wonderful things that you're not using versus the customer actually saying, you know what? I need this to your point, I suppose, Valentino. Pranav, we'll start start with you. Where... What types of clients are you hearing leading the conversation versus you having to go in and and and provide that that leadership?