EXCLUSIVE: “Building Differentiation for Banks” – Jussi Lindberg, Banking Circle in ‘The Fintech Magazine’
Banking Circle solutions are powering the payments for more than 250 regulated businesses, financial institutions and marketplaces, enabling them to gain access to the markets in which their customers want to trade, via a super-correspondent banking network. Here, Jussi Lindberg, its Chief Commercial Officer, explains the approach
“For payments businesses and banks that want a slice of the global e-commerce market, fast, fairly priced payments services that can be easily integrated into their own platforms are critical,” says Jussi Lindberg, chief commercial officer for Banking Circle.
Overcoming a myriad of challenges is key to capitalising on this opportunity. At the heart of these is legacy. There’s also competition coming from new entrants and continued regulatory scrutiny.
“Banks hold a really fundamental ‘trust contract’,” says Lindberg. “They are ideally placed to give their customers better, faster, more cost-effective services.
“The institutions that want to respond to new market opportunities and work in new jurisdictions tell us that they want to do that without diverting focus and investment from their core business.
“Banking Circle is helping banks to create their niche in the business banking marketplace. Collaboration delivers solutions underpinned by fit-for-purpose tech, supported by regulatory expertise. Banks that might have thought ‘that’s not for us’ previously, now realise how we can help them ‘be more fintech’ without putting the ‘trust contract’ they all treasure at risk.
“Banks that might have thought ‘that’s not for us’ previously, now realise how we can help them ‘be more fintech’ without putting the ‘trust contract’ they all treasure at risk”
“We are a genuine partner that allows financial institutions to take care of their business rather than get distracted by opportunities that sit outside of their core. Banking Circle and our bank clients work well together on things like tech capabilities; keeping up with regulatory burden and exploring regions and jurisdictions where they might not be prevalent, but still want to be able to offer a service.
A SANDBOX FOR INNOVATION
“Banking Circle is almost like a sandbox to test out new propositions, opportunities, markets and jurisdictions. Our regulatory experience and tech capabilities complement banks’ own. Plus our payment rails for 25 currencies and 24/7 liquidity give financial institutions confidence we can handle significant volumes.
“We’re also giving banks a future view. This is particularly important in the area of regulation, whether it’s understanding what’s coming next or having knowledge about new jurisdictions they want to enter.”
THE DE-RISKING EFFECT
Another area where Banking Circle is helping banks is de-risking. Larger banks that serve the smaller Tier 2 and Tier 3 institutions with correspondent banking services, have found themselves with little choice but to de-risk entire regions, sectors or individual partners. The knock-on effect is that medium-sized banks have seen their correspondent banking partnerships under threat. Small fish in a big pond, the lack of buying power means they find it harder to create a competitive proposition they can confidently offer to their customers.
Research that Banking Circle released earlier this year found that more than three-quarters of Tier 2 and Tier 3 banks had seen their number of correspondent banking partners rise over the past decade: 65 per cent said they think they have too many banking relationships.
“We have the conversation about de-risking with almost every bank we talk to,” explains Lindberg. “Banks are spreading their own risk by working with a greater number of correspondent banks. But more relationships mean more internal resources to manage these partnerships. It also means additional costs, which, inevitably, pass on to the end customer as well as undermining profitability.”
For banks wanting a slice of the cross-border payments opportunity, without having to worry about legacy infrastructure or risk holding them back, Banking Circle has built solutions from the ground up. The fact that the provider is working with more than 250 financial institutions across the globe is evidence of how it is delivering solutions that are the right fit for the market.
“A number of banks and non-banking financial institutions (NBFIs) are already benefitting from the investment in innovation, accessing fast, fairly priced payment services that can be easily integrated into their own platform,”concludes Lindberg. “With a clear approach to support global finance – not de-risk – our clients trust us, so that their customers can trust them in return.
Jussi Lindberg, CCO, Banking Circle
Jussi Lindberg joined Banking Circle in 2022 and is on a mission to tackle financial exclusion. Having worked in global payments and e-commerce for more than 20 years, he has extensive experience of the empowering role of effective, fit-for-purpose solutions. He has held roles in some of the industry’s leading businesses, most recently as senior vice president of business development at Adyen, where he helped elevate the company to become one of the world’s leading payment platforms.
Prior to Adyen, he was at PayPal and eBay, working with hundreds of enterprises to drive growth and improve digital performance. He is now applying his vision and experience to the new role on Banking Circle’s executive board, helping financial institutions capitalise on the universal benefits of a financial ecosystem that operates in a network of collaboration.
About Banking Circle
Banking Circle is a fully-licensed, next-generation payments bank designed to meet the global banking and payments needs of payments businesses, banks and marketplaces. Through its API, it delivers fast, low-cost global payments and banking services by connecting to the world’s clearing systems – enabling its clients to move liquidity in real time for all major currencies securely and compliantly. The bank processes more than six per cent of Europe’s B2C e-commerce payments flows, equating to more than €250billion in 2021 alone.
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