The UK fintech scene is a very exciting one as it’s come so far in such a short span of time. Every day there’s new innovation, new products and new companies. When it comes to innovation around SME the big needle mover was the rise of the digital banking pioneers. They shed light on the importance of serving the largest part of the market, the 99 per cent of companies who fit the small- to medium enterprise definition.
However for too long SMEs went underserved by large corporations. SimplyPayMe (formerly SmartTrade App) works to not only serve this market, but put them at the forefront of everything they do. Rather than labelling small businesses as ‘risky’ and neglecting to deal with their business, SimplyPayMe are changing the way that the fintech industry view SMEs and making their payments not only easier and more accessible, but making them feel seen and valued.
Here in our latest Behind the Idea feature, we meet Kent Vorland, CEO of SimplyPayMe since 2017. Vorland has a varied professional background, from being an instructor in the Royal Norwegian Air Force Officers’ Academy to working on Wall Street, to starting his own startup in London.
He explains how the company is shaping the future for how small businesses make payments.
What has been the traditional response to financial technology innovations nationally?
Historically SMEs have been under- or even unserved as they will individually not be providing the volume or revenue needed to make them interesting. Although this is now shifting, with help from companies like us who are changing how small to medium businesses are viewed, there are still major problems for SMEs in the fintech space, such as onboarding, high rates, and long payouts that aren’t addressed by large financial corporations.
How has this changed over the past few years?
Digital banks have really brought in a whole new focus and aspect to SME. Now that Fintechs are showing that if you can serve them right, gain traction and mass, they can be the most profitable segment in the market. As SimplyPayMe has rolled out payments and business management tools for SME we’ve seen great responses in the B2B space, where we will offer our platform to companies and institutions who serve SMEs to help them add value to existing offerings. Banks, FIs and other similar institutions are recognising the value, but at the same time realising that with the pace fintech is moving at, it makes more sense to partner with someone like ourselves, rather than trying to build these platforms and integrations themselves and falling far behind those already specialising in these services for SMEs.
We’re also seeing a few technical aspects now becoming more and more widely accepted as they’re seen from larger companies. For example, SPM’s card scanner, where you simply hold a credit or debit card up to your phone’s camera and it will pick up the details for you to process the transaction. Years ago this was too new and raised a few eyebrows as it was misunderstood as taking a picture of someone’s payment card. However, as the likes of PayPal and Uber started using similar technology to store a card on your account this nervousness is just about completely eradicated and now only causes excitement.
Is there anything that has created a culture of change inside SPM?
I wouldn’t say there’s been a change, but rather a positive development. As we grow and learn more and more about the lack of inclusion and enablement in the global SME space, it’s becoming more and more clear that we are doing the right thing in working for them. So the culture continues to strengthen with an ethos that always puts SME in the middle.
What fintech ideas have been implemented/built?
At SimplyPayMe we have built a unique platform for POS technology, where we’ve taken existing payment APIs from multiple payment processors and acquired and shaped them into something that translates into the ability for a small business to accept a payment using nothing other than their phone. There’s no need for external hardware or card readers. Bear in mind, this is different from SoftPOS in that this is not a contactless payment, which means we are not restricted to Android only or transaction limits. We’ve then taken this a step further and built a platform for other large banks, FIs and institutions to ingest our technology into their own to supplement with payments, invoicing, SME CRM tools, team management and more. In 2022 SPM will also start managing money out for the merchant, so there will be no need for anything other than your SPM application to run your entire business while maintaining complete control of both income and expenses.
What benefits have these brought?
Companies serving SMEs do not have to develop their own complex back-ends for payment management (and they are complex!) while the SME has a completely all encompassing environment to run their entire business from a single application.
Do you see any other industry challenges on the horizon?
One of the biggest problems for inclusion and enablement of SMEs today is onboarding. Very few have effective onboarding of small businesses or sole traders to actually allow them to utilise financial services. Furthermore, the general terms of payments and settlement are very skewed where the large corporations with high volumes get low rates and immediate payouts, while the plumber who’s working to put food on the table gets the highest rates and longest payout times in the industry, if he even gets the opportunity.
Can these challenges be aided by fintech?
Fintechs are key to streamlining these processes and we are working with many of them in doing so already. Including SME into the digital economy and financial ecosystem is crucial for the survival of small business and will be an important piece in any economy.
Final thoughts…
UK fintech is moving by leaps and bounds with the innovation that is changing daily. However with a large and valuable sector, SMEs being left behind by the industry, it’s difficult to move forward. SimplyPayMe is changing this trend and shaping the future for how small businesses do business, make payments and are valued , while allowing banks, fintechs and other institutions providing services to do the same by utilising the SimplyPayMe infrastructure as a whole or in parts.
