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Sibos Panel: Unlocking the Value of BaaS and Contextual Finance in Wholesale Banking

Banking as a Service (BaaS), embedded finance, contextual finance – we hear these terms and read headlines on these topics daily. But what do they mean? Who are the key players and how will they monetize the reported $7 trillion market opportunity? Most importantly, how are they planning to deliver tangible benefits, at pace?

To help answer these questions, Finastra brought together a panel of experts at Sibos. The panellists included: Mark Williamson from HSBC, responsible for the bank’s FX Everywhere initiative; Andy Hirst from SAP Financial Services, an expert in banking transformation and modernization; Valli Ardalan who leads Visa Direct‘s global network expansion; and Finastra’s Chief Product and Technology Officer, Eli Rosner. A snapshot is below.

Market shifts, innovation and the role of technology

Mark, HSBC: We’re looking to embed finance into our clients’ journeys, into the tools and distribution channels they use today. Whether it’s an Enterprise Resource Platform (ERP) system, a Treasury Management System (TMS), or a client’s mobile phone, we’re looking to ensure that we’re putting finance at the right place, at the right time, for our customers.

Valli, Visa Direct: Customers are looking for ways to improve cash flow, liquidity, security, and the data that accompanies payments to optimize their operations. We’re bringing to market a digital-first, easy and transparent way for our clients to enable their business customers to send and receive money in the way that works for them.

Andy, SAP: Many corporate customers are connected through our business networks to their banking partners, so how can we help make their journey as easy as possible and as frictionless as possible? Embedding financing applications deeply within the SAP application can help that digital journey for our clients, making it easier and frictionless.

Who holds the key to success?

Eli, Finastra: There’s no single player who holds the key. It’s going to be a push-pull game. The chain starts with the consumer or corporation – paying money to conduct business with a brand. Banks like HSBC and companies like Visa are stepping forward to provide new capabilities. And companies like Finastra are helping bring the different sides of the network (the regulated entities and embedders) together in an open finance ecosystem. It’s a very interesting dynamic.

Mark, HSBC: I think it’s really important that everyone has clear roles and responsibilities within this new ecosystem. Banks have the license to pay. We’re regulated. And for our clients that use SAP and other services, we need to ensure that we’re providing that final mile in that payment supply chain and that we’re part of our clients’ journey. For example, so that they don’t have to come out of their SAP system to access embedded FX payments and financing.

Valli, Visa Direct: Businesses want to pay and get paid in the quickest way and the most efficient way possible. Our job is to secure that capability. This is where Visa’s network of networks strategy comes in. We look to be a single connection point for our clients to move value, whether that be on Visa’s network or beyond.

Andy, SAP: We want to empower our banking partners to enhance the customer journey for the corporates we serve. Uptake is best when it’s a natural part of a client’s normal action, when they’re in their application to request financing or FX.

How would you summarise?

Valli, Visa Direct: Consider Metcalfe’s Law which states the value of a network is proportional to the square of the number of nodes in the network, so as you add each node to a network, the value of the whole network is enhanced far beyond the addition of a single node. It’s a change in the way that we are all operating. Regarding Visa’s role in shaping what we see as the future of B2B2C payments, we’re looking at a transformation of money movement globally. It’s about being aware of what the customer needs and building solutions to solve the problems they have.

Mark, HSBC: The transition from heritage to digital is going to provide us with a whole bunch of opportunities and challenges. We’re going to listen to our clients and the tools and channels that they consume our data and services from. How we connect that, and whom we choose to partner with, to provide those solutions to our clients at the right place at the right time, is going to be really important.

Andy, SAP: We have a vision of building a huge business network, interconnecting all 400,000 ERP customers with ourselves. That will give our banking partners, and others, a business opportunity to build a customer journey offering embedded capabilities such as financing, FX, or cash management.

Eli, Finastra: If the future of finance is open, then everything needs to be delivered as-a-service. All of us recognize that it can’t be done alone.

Angus Ross, Global Head of Banking as a Service and Technology Alliances at Finastra and host of the panel concluded: “To build that network of networks, to drive the adoption, to do what’s relevant for the customer, it has to be done in collaboration. I think we’re all energized and excited about the opportunity ahead.”




  • 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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