Behind the Idea Paytech

Behind the Idea: Wevat

Wevat digitises the process of tax refunds for tourists and was the first B2C tax refund company to be accepted in the UK. It has strong partnerships and seamless integration with payment providers such as Alipay and WeChat Pay. It has helped more than 70,000 people from 88 countries get VAT refunds on purchases of more than €18 million since launch.

Covid-19 has accelerated the rise of contactless payments with 69% of retailers seeing an increase in non-cash transactions during the pandemic. As consumers become more comfortable with making financial transactions on mobile apps, other traditionally paper-based systems, such as tourism tax reclaim, are likely to become more digitised in the future.

Raphael Chow is CEO and founder of Wevat, a B2C money-saving tax reclaim app. He has spent his life in Hong Kong, Canada and the UK and also runs a startup community called ‘Nest’ to bring together the most talented Chinese founders in Europe. In 2021, Chow was named on the Forbes 30 under 30 list. Prior to launching Wevat, Chow worked as a strategy consultant for Deloitte.

What has been the traditional company response to financial technology innovations nationally?

Traditionally, the VAT refund process for travellers has been overly complex, slow and inefficient. Claims had to be made on paper forms only available from retailers who were working with refund companies and taking their cut. This led to lengthy airport queues at VAT refund desks and consumers also saw high admin fees due to commissions being passed down to them.

I decided to do something about it and launched Wevat in 2016 with the aim of digitising the whole process and giving consumers the ability to skip the middleman and directly apply for refunds on their phone. With consumers becoming increasingly confident to bank on mobile, it seemed like a natural fit to create an app for tax refunds.

How has this changed over the past few years?

Brexit has had a huge impact on the company and industry; most recently with the UK government deciding to cancel VAT refunds from the 1st Jan 2021 onwards for international travellers. This meant we needed to shift our focus to UK travellers who were now eligible for tax-free shopping in the EU. UK travellers are now able to use Wevat to reclaim the tax on their shopping in France via our app which is available now in the app store.

Covid and the need to make processes and systems contactless has also meant there’s a real interest in using apps for tax reclaim as opposed to paper forms.

Is there anything that has created a culture of change inside the company?

As a fintech startup operating at the cross-section of travel and retail, Wevat was hit hard due to the pandemic, with the closure of the travel industry and the shut-down of all but essential stores. We managed to weather the storm and saw a resurgence of app users (predominantly Chinese students) in the summer after lockdown. This proved to me and my team that we had a product that users still needed which spurred us on to continue innovating. Now with travel opening up again and the resurgence in retail, we’re in a good position to see growth from these two trends.

What FinTech ideas have been implemented?

Much like challenger banks, we wanted to disrupt the tax-reclaim process, which was a very manual and paper-based process at the time. We were the first digital VAT refund provider when we launched our first service to international travellers taking advantage of UK tax-free shopping and have now expanded that service out to UK residents who want to shop tax-free in France. We’ve taken inspiration from challenger banks by including the ability for customers to upload their purchase invoices on the go. Customers can also automatically generate a digital refund form in the app, and track the progress of their claim. We make it simpler for consumers to take more control of their money and the process, and in turn, benefit from increased refunds compared to traditional tax-reclaim companies.

We also offer live customer support so we can answer any questions quickly within the app. We’re also very customer focused which means giving the customer more control over their refund. Compared with other tax-reclaim services where cash is received at the airport at a below-market rate – we provide a live currency exchange rate so customers can choose the currency and method they want for their refund – putting them in charge of their money through their mobile device.

What benefits have these brought?

It makes the whole process of tax reclaim hassle-free. No more lost paperwork or long queues at the airport. So far, we’ve helped travellers from 88 countries to get VAT refunds on purchases amounting to more than €18 million. We anticipate huge savings for UK tourists as we shift our focus on helping them achieve tax refunds when holidaying in the EU– taking advantage of this new tax-free shopping perk.

Ultimately, we’re empowering our customers through our mobile app to take control of their money and the refund process. 

Do you see any other industry challenges on the horizon? 

Many of the challenges on the horizon are not new but will continue to be an area of focus for the industry. These include cyber security risks, regulatory issues or even maintaining consumer trust when it comes to managing their finances via their phone.

Can these challenges be aided by FinTech?

Consumers are more aware of cyber security risks but it’s also important for the fintech industry to continue to innovate here to make it easier for customers to access money that is theirs but without making it easier for criminals. Education will also play a crucial role in helping customers to avoid falling victim to potential scams and perhaps it would make sense for fintech companies to put competitive differences aside and collaborate more in fighting fraud collectively.

Final thoughts…

We’re looking forward to more consumers discovering Wevat and discovering just how much money they can reclaim on their purchases in the EU.

Author

  • Gina is a fintech journalist (BA, MA) who works across broadcast and print. She has written for most national newspapers and started her career in BBC local radio.

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