CUSTOMER INTERFACE: BUSINESS BANKING SMEs across Europe have woken up to the digital reality of life, post-COVID. While many complained before about the inadequacy of (often analogue) business banking services, only the most switched-on sought out alternative providers to plug the gaps. Now that they’ve all been catapulted into an online-driven, multi-payment platform marketplace, many more are having to decide whether to stick or twist, asking themselves if they should leave the legacy banks they know for a challenger they don’t, or buy in a patchwork of discrete services from direct-to-market fintechs that can help them manage an unpredictable business environment better? In Portugal, the country’s third largest bank, Novo Banco, is making that choice much easier for them. Already the country’s most popular bank for SMEs, it’s partnered with AI-powered software solutions provider Strands to launch a Portuguese banking first: an online interface called NBnetwork+ with
a host of embedded business financial management tools (BFMs). NBnetwork+ is the default interface that business customers now see when they log onto their internet banking, and it currently comprises four key solutions: multi-bank account aggregation, giving a 360-degree view of their financial status; payment initiation from any of those aggregated accounts, regardless of the custody bank (by virtue of the SIBS open banking platform, used by 24 Portuguese banks); categorisation of revenue and expenses to give an immediate snapshot of business health; and a financial calendar that can be used for both retrospective business analysis and to predict future performance and cashflow around key events, such as paying their VAT or salaries. Meanwhile, procedures that previously required a call or a visit to a branch, such as applying for short-term credit, can be executed through the portal. It’s turned Novo Banco, in effect, into a one-stop shop for businesses of all sizes to do their everyday banking, analyse their financial health and performance, and help inform their future strategy. The online platform is supported by existing business relationship managers who now, thanks to more data and its automated collection and analysis, have the
Stick or twist?
autonomy and headroom to give better advice and faster decisions around, for instance, when dealing with more complex credit applications. The impact, particularly for small enterprises, has been profound, says João Dias, chief digital officer at Novo Banco, who has led the bank’s digital transformation since 2018. “The feedback we are getting is that using these tools is helping them change their own processes; the way they do their financial planning or day-to-day controlling. It’s helping them become more efficient by using digital channels to do things,” says Dias. “From the beginning, we wanted to be able to provide interesting solutions that would drive customers to the interface. And we see further opportunity to do that, in ways which are relevant for smaller companies that don’t have the budget, capacity or resources to do certain things for themselves.” A study by the European Central Bank in 2019 identified big gaps in knowledge and awareness among Portuguese business owners and managers, when it came to applying digital solutions to processes and channels. The number of companies selling across e-commerce platforms in Portugal is, for instance, way below the European average. A report, the same year, from analysts McKinsey, concluded that coaxing customers towards digital channels offered enormous potential for banks in Portugal. A platform service that educates entrepreneurs on how to use tools to monitor and predict their business’ financial health, will then, in theory, lead to a longer and more profitable relationship between them and the financial provider.
Many business banking customers have ample excuses to use alternative providers. Portugal’s Novo Banco wasn’t going to give them one, as its CDO João Dias and Brian Stewart of AI solutions provider Strands explain 28
TheFintechMagazine | Issue 21
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