Deep Dive: Embedded Finance

In this episode of Deciphered, Adam Davis, expert associate partner at Bain & Company, is joined by Erin McCune, expert partner at Bain & Company, Manish Kohli, head of global payments solutions at HSBC, and Thierry Chilosi, chief strategy officer at Swift, to discuss what’s at stake in the world of Wholesale Payments.Timestamps:00:00 Introduction04:07 What’s at stake in the world of Wholesale Payments?08:06 Why are wholesale payments so important?10:05 From the FI's perspective, what are the profit pools and ways of making money within wholesale payments?14:51 How have wholesale payments changed in the last 10 years? What's driving innovation?23:39 Will real-time payment networks lower the barrier to entry for new payment products?29:00 What are the effects on working capital and liquidity with real-time infrastructures working 24/7?33:48 Swift's modernisation journey - from telex to the new XML standards36:57 How will Swift's new collaborations with Visa and Wise serve businesses and banks going forward?38:38 What makes a successful partnership in the fintech space?42:19 What will the wholesale payments industry look like in 15 years?You can read more about Bain’s POV on Wholesale Payments in the recently published brief: The Fragmentation of Wholesale Payments Calls for Banks to Remake Their ApproachPlease subscribe to the show so you never miss an episode, and leave us a review if you enjoy the show!You can find Adam Davis hereYou can find Erin McCune hereYou can find Manish Kohli hereYou can find Thierry Chilosi hereFor more insights from the Deciphered podcast, visit the page on Bain’s website

In this episode of Deciphered, Adam Davis, Associate Partner at Bain & Co, is joined by Aman Narain, Global Head of Platforms and Embedded Banking, HSBC, to discuss the topic of embedded finance.Timestamps:00:00 Introduction02:42 Embedded finance use cases05:08 Maturity of integrated, insightful & instant in embedded finance06:09 Integrated definition & use cases07:06 Building a proposition inside HSBC10:14 Biggest business challenges in embedded finance11:38 Who will disrupt embedded finance in the future?13:56 Embedded finance sales plays for non-FIs16:05 Working capital17:47 Is gen AI overhyped?19:04 Given $10M to start a fintech - what would you do?19:40 Advice to your younger self about banking and the FS industryPlease subscribe to the show so you never miss an episode, and leave us a review if you enjoy the show!You can find Adam Davis hereYou can find Aman Narain hereFor more insights from the Deciphered podcast, visit the page on Bain’s website

In this episode of Deciphered, Adam Davis, Associate Partner at Bain & Co, is joined by Jeff Tijssen, Expert Partner and Global Head of FinTech, Bain & Co, Christina Riechers, General Manager, Square Banking and Richard Davies, Chief Executive Officer, Allica Bank, to discuss SMB: Is there still a growth opportunity, or are they now over-served?Timestamps:00:00 Introduction07:37 SMB: Still a growth opportunity, or now over-served?12:52 Strategy of Square banking & what is your remit?15:27 Differentiating Square banking & gaining autonomy17:40 Success factors at Allica Bank19:33 Have SMB margins held for providers through the cost of living crisis/rising interest rates?23:52 How much share should fintechs take from incumbent FIs and banks?27:46 How hard is it to capture ongoing SMB engagement without a full integrated banking offering?29:53 What new products are Square and Allica Bank looking to provide?34:15 Jobs for small businesses: What are they, and how are they effected by technology?39:55 What are the differences in serving increasingly larger businesses, and how do jobs change with this?44:47 Should we expect consolidation in facets of SMB? And who's competitive in the space?Please subscribe to the show so you never miss an episode, and leave us a review if you enjoy the show!You can find Adam Davis hereYou can find Jeff Tijssen hereYou can find Christina Riechers hereYou can find Richard Davies hereFor more insights from the Deciphered podcast, visit the page on Bain’s website

In this episode of Deciphered, Adam Davis, Associate Partner at Bain & Co, is joined by Jeff Tijssen, Expert Partner and Global Head of FinTech, Bain & Co, Mike Cashman, Partner at Bain & Co, Mariagiovanna Di Feo, Partner at Bain & Co and Mike Smith, Partner at Bain & Co, to discuss what trends will arise and what changes to the industry we will see in 2024.Timestamps:00:00 Introduction03:38 What will we see in fintech in '24?10:35 2023 rewind: Rising rates, regulations, open banking & digital assets13:30 Profitability16:40 Investor sentiment going into Q1 '2421:31 Differentiation between VC & PE23:43 Geographical nuances, investor appetite & growth25:13 Payment predictions for '2428:18 Growth, card flows, & alternative payment methods31:00 Embedded finance & connected vehicles - will we see growth?35:33 How will blockchain evolve over the next year?39:19 How can digital banks/players position themselves for the change in growth?44:59 No. 1 predictions for 2024Please subscribe to the show so you never miss an episode, and leave us a review if you enjoy the show!You can find Adam Davis hereYou can find Jeff Tijssen hereYou can find Mike Cashman hereYou can find Mariagiovanna Di Feo hereYou can find Mike Smith hereFor more insights from the Deciphered podcast, visit the page on Bain’s website

In this special episode of Deciphered, recorded LIVE from Money20/20 USA in Las Vegas, Jeff Tijssen, Expert Partner and Global Head of FinTech, Bain & Co, Mike Cashman Partner, Bain & Co, are joined by Sophia Bantanidis, Future of Finance, Citi Global Insights, Citi and Peter Hazlehurst, Co-founder and CEO, Synctera, to discuss disequilibrium across the banking industry in 2023, restoring balance, and exploring the potential for new growth within the Financial Services industry going into 2024.Timestamps:00:00 Introduction05:04 Disequilibrium in banking: Have we restored balance, and where can we find new growth?08:05 The importance of understanding disequilibrium in banking10:20 Reflecting on what's been going on in the industry over the past 12-18 months12:53 Changes in the interest rate environment: Is the worst behind us? In what ways has finance & the banking sector resorted to balance in 2023?17:11 Turmoil in the FS industry & BaaS19:03 How do regulatory changes impact an organisation's ability to achieve new growth?21:44 Stimulating innovation vs protecting consumers24:28 The current funding landscape & projections for next year29:37 Significant challenges and opportunities when achieving sustained growth32:49 Where will new growth come from next year in FS?34:39 Surprising positive predictions for '24Please subscribe to the show so you never miss an episode, and leave us a review if you enjoy the show!You can find Jeff Tijssen hereYou can find Mike Cashman hereYou can find Sophia Bantanidis hereYou can find Peter Hazlehurst hereFor more insights from the Deciphered podcast, visit the page on Bain’s website

In this episode of Deciphered, Adam Davis, Associate Partner at Bain & Co, Bhavi Mehta Partner, Bain & Co, are joined by Sarah Hinkfuss, Partner, Bain Capital Ventures and CJ Przybyl, Co-founder and CEO, Reserv, to discuss how AI will impact fintech, whether or not it will level the competitive advantages of larger financial institutions, and just what this technology means the Financial Services industry. Timestamps:00:00 Introduction06:57 AI & Fintech: Will this level the competitive advantage & playing field?10:50 Why is generative AI such a game changer in this industry?13:10 Is generative AI just another tech bubble?15:32 What key ingredients do smaller vs bigger organisations need to benefit from AI?22:04 Who will take the majority of the market share with AI services?28:10 How difficult will it be for FIs to get their hands on data across multiple LLMs?29:59 Use cases & funding35:42 How will AI affect jobs in the future?39:31 Ethical considerations & biases of AI44:28 Implementation and execution of AI46:30 Maintaining competitive advantage50:30 Speed differences with utilising AI51:52 Over the next 10 years, which unexpected ways will consumers use AI?Please subscribe to the show so you never miss an episode, and leave us a review if you enjoy the show!You can find Adam Davis hereYou can find Bhavi Mehta hereYou can find Sarah Hinkfuss hereYou can find CJ Przybyl hereFor more insights from the Deciphered podcast, visit the page on Bain’s website

In this episode of Deciphered, Adam Davis, Associate Partner at Bain & Co, and Maureen Burns, Partner, Bain & Co, are joined by Ather Williams III, Head of Strategy, Digital, Innovation & Enterprise Payments, Wells Fargo to discuss how Wells Fargo continue to innovate, and embrace new technologies, despite a myriad of different influences, as well as being a ‘systemically important financial institution’ in the United States.Timestamps:(02:55) The growth imperative: How do you keep innovating in the largest financial institutions?(05:03) Is there a change in customer expectations from their banks?(07:14) Difference in the younger generation's needs vs traditional customers & serving both(10:44) Top 3 challenges to innovation at Wells Fargo & contextual banking(14:53) Principles & innovations practise adopted by teams at Wells Fargo(20:45) Impact of fintechs on competition & collaboration(24:56) A2A payments & vast adoption(28:22) Exciting new products when thinking about growth areas over the next 3-5 years(32:28) If you were to create an FS startup now, what field of finance would you focus on?Please subscribe to the show so you never miss an episode, and leave us a review if you enjoy the show!You can find Adam Davis hereYou can find Maureen Burns hereYou can find Ather Williams III hereFor more insights from the Deciphered podcast, visit the page on Bain’s website

In this episode of Deciphered, Adam Davis, Associate Partner at Bain & Company, is joined by Jeff Tijssen, Partner, Bain & Company, Janine Hirt, CEO, Innovate Finance and Shannee Braun, Director, EQT, to discuss the decisions behind fintech acquisitions in 2023.The fintech investment landscape has changed dramatically, what are the reasons behind this, and are the tides slowly changing...?Timestamps:- (03:43) Tuck-in or take-out: The decisions behind fintech acquisitions in 2023- (06:38) Fundamentals: Investments & profitability- (08:38) Fintech multiples: How have they changed since recent correctional valuations across fintech verticals & which ones are becoming more prominent?- (11:21) Newer-stage companies getting funded in the UK & success in deal flow- (13:03) Fintech to fintech acquisitions- (14:40) Will things return to how they were in 2021?- (17:14) Large FIs & acquisitions- (18:58) What spots are hot at the moment?- (23:31) What can incumbent banks learn from acquisitions by big techs?- (25:43) Interesting opportunities in other industries- (27:54) Keeping the UK competitive- (29:14) Major takeaways from the conferencePlease subscribe to the show so you never miss an episode, and leave us a review if you enjoy the show!You can find Adam Davis hereYou can find Jeff Tijssen hereYou can find Janine Hirt hereYou can find Shannee Braun hereFor more insights from the Deciphered podcast, visit the page on Bain’s website

In this episode of Deciphered, Adam Davis, Associate Partner at Bain & Company, is joined by an all-Bain line up; Partners Joe Fielding, Maria Teresa Tejada and Guilio Naso to discuss whether or not there is a current crisis when it comes to banking liquidity.  The unfolding liquidity issue across banking has been benchmarked in some quarters against the great financial crisis of 2008…the question we want to answer is - is this fair?Timestamps: (04:34) Banking liquidity: Is the talk of a crisis fair?(06:27)Will this period in banking be as challenging as other periods with dramatic upwards rate cycles?(08:01) Catalysts that have contributed to dramatic upwards rate cycles(10:44) Which banks are in trouble?(13:37) How much has deregulation led to this?(16:43) How would we fix this problem?(20:04) Representations of demand & characteristics of banks/financial institutions that are offering solutions(23:18) The bigger, the better?(24:26) Trust within neobanks/new digital players(25:35) Where does this lead? And will the changes be permanent?(29:33) Credit and credit provisioning(31:08) Will there be any differences in how The Fed supervises banks because of this?(33:58) How will innovation be impacted by this in the short–medium term?Please subscribe to the show so you never miss an episode, and leave us a review if you enjoy the show!You can find Adam Davis hereYou can find Joe Fielding hereYou can find Maria Teresa Tejada hereYou can find Giulio Naso hereFor more insights from Bain & Company on the current disequilibrium we’re seeing across the banking sector currently, check out the content below:Disequilibrium in Banking: Five Actions to Restore BalanceIn a Time of Disequilibrium, Banks Face New Liquidity ChallengesNot a Banking Crisis, But a Battle for Street CredFor more insights from Deciphered: The Fintech Podcast, visit the page on Bain’s website.

In this episode of Deciphered, Adam Davis, Associate Partner at Bain & Company, is joined by Karim Ahmad, Partner, Bain & Company, Kelly Devine, President, UK & Ireland, Mastercard, and Colin O’Flaherty, Head of SME for Barclaycard Payments, to discuss the future of retail transactions.Retail payments is both a rich and growing industry, with Bain & Company estimating the total revenue value at $356 billion dollars, with a projected annual growth of 6% over the next 5 years. But the balance of power between traditional and new entrants in this area of finance is slowly shifting. In this hotly contested market, some 90% of today’s revenue pool could migrate to software vendors, major technology firms, and other contenders.How will the retail transaction market evolve over the next 10 years?Timestamps: - (03:14) Consumer to business payments - what is the future of retail transactions?- (05:53) Which providers/industry players have been driving the change in banks' monopoly vs reacting to the change in & how do you see that evolving in the market short term?- (10:07) Which trends interest you from the perspective of your role at Mastercard?- (13:27) Within the SMB segment, how important are virtually integrated platforms, do you see the same proliferation in the UK/Europe as in the US, and where do you see those trends fitting into the SMB context?- (16:45) Card growth and looking towards alternative payment methods for growth.- (22:26) Potential innovations that relate to card volumes and the rise of A to A payments.- (26:09) Embedded payments, the proliferation of wallets and connected devices - (27:51) How do Barclaycard build confidence in supplying payments to organisations where the end users are unknown?- (33:18) Are investments in sales, marketing, and brand increasing to positively impact customer trust?- (39:13) Open banking  Please subscribe to the show so you never miss an episode, and leave us a review if you enjoy the show!You can find Adam Davis hereYou can find Karim Ahmad hereYou can find Kelly Devine hereYou can find Colin O’Flaherty hereFor even more information, check out Bain’s latest report – Consumer-to-Business Payments: A Strong Growth Outlook, but Only for the Well-Prepared.For more insights from the Deciphered podcast, visit the page on Bain’s website