Payment API Integrations with Daniel Cronin of Integrated Finance  | Soar Payments LLC
Daniel Cronin of Integrated Finance; Payment API's

Payment API Integrations with Daniel Cronin of Integrated Finance 

Integrating your fintech or payments company with complementary services is essential, but it’s also a huge headache that consistently blows through budgets and deadlines. In this episode, Daniel Cronin Co-Founder of Integrated Finance tells us about how off the shelf integrations can allow fintech and payments companies to dramatically improve their services in a more stable cost effective manner than native building. If you’re a fintech business owner or executive, listen in on one of our most actionable episodes yet!

Payments & Fintech Insights In This Episode

  • The evolution in the world of Fintech
  • What Integrated Finance is and the solutions it offers
  • Daniel gives us insights on how to offer your customer the right service
  • A deep understating of the different relationships between the merchant acquirer and the payment processor
  • Integrating multiple APIs in one solution
  • The trends Daniel is anticipating for 2023
  • And much more!

Today’s Guest

Daniel Cronin : Integrated Finance

Integrated Finance was established by the founding team of a UK based BaaS business. As the business scaled, building and maintaining connectivity to an increasing number of compliance providers, banks and fintech integrations became a burden that consumed valuable engineering time. Instead of focusing on developing unique products for customers, they needed to constantly commit resources to deliver and maintain a baseline functionality customers expect. They tried to solve this problem by partnering with a company that could take this pain away, but no company existed. That’s why Integrated Finance founders decided to build it themselves. Integrated Finance is the outcome of first-hand experience of the pain of integrating and stitching together a vast landscape of financial banking providers and partner connections. Their cloud-native, financial infrastructure platform allows fintechs to access on demand core financial services and integration workflows, designed to accelerate time to value.

Featured on the Show

About PayPod

PayPod is the leading voice in the payments and fintech industry, covering payments, risk management and new technology. Host Jacob Hollabaugh interviews leaders who are shaping the payments and fintech world, as they discuss the latest developments in the payments and fintech industry.

Episode Transcript

Jacob: Welcome to PayPod. The Payments Industry Podcast. Each week, we’ll bring you in-depth conversations with leaders who are shaping the payments and fintech world from payment processing to risk management and from new technology to entirely new payment types. If you want to know what’s happening in the world of fintech and payments, you’re in the right place. Hello, everyone. Welcome to PayPod. I’m your host, Jacob Hollabaugh. And today on the show we are talking API integrations and how small businesses and startups can navigate the overwhelming amount of tools coming out of the fintech space right now. Joining me to explore these topics is Daniel Cronin, co-founder of Integrated Finance, the platform that modern FinTech is built on. Daniel, welcome to the show. Thank you so much for being here.

Daniel: Thank you very much. It’s a pleasure to be talking to you today.

Jacob: Yes, same for you. Let’s start out high level for a moment, if you will, by talking about how far this industry and really the world at large has come. It really wasn’t that long ago that companies, you know, kept general ledgers on paper. But when you fast forward, then all the way to today, 2023, it seems like you can almost be inundated by all the different financial technologies that are available to businesses. New ones coming out every day. Has that shift purely just been technological advancement, or do you think there are other driving forces behind it? Consumer wants, business needs. What do you think’s been driving this big advancement and now this kind of inundation with so many different tools?

Daniel: Well, I’d say primarily it’s compounding of technological advancement, but there’s also outside factors that affect consumer behavior, which, whilst in the long run probably don’t make a great deal of difference in the short term, in specific periods, it accelerates adoption. My favorite examples of this in the fintech space would be the ATM. Nobody wanted it back in the day. It was pretty useless. People didn’t trust it and everyone would go into their branch. I think it was Citibank, but I might be wrong. In New York there was a horrendous winter there where they were actually considering just getting rid of these things because there was huge cost and nobody was using them with the huge winter storm, nobody could get to work. And suddenly this became the only way that citizens of New York City could get their money out of the bank. And so an outside event accelerated an adoption of a new type of technology later than that. Covid obviously accelerated the adoption of many products outside and inside of fintech. But certainly companies like Stripe were the benefactors of digital e-commerce, and small store owners quickly had to adapt to a digital environment just to be able to survive. So there’s not just technological advances that accelerate this.

Daniel: It can be real world environments too, but for the most part, it’s technology, right? The power of compute came down to the point where people could access computers. The Internet meant people could access computers outside of just being on a desktop and in one place at one time. Amazon Web services and cloud storage meant you didn’t have to have a room in your building for a bunch of servers, and everything’s been a stepping stone on top of that. Probably one of the big advocates for interconnectivity and interoperability, which is two words that you get thrown around a lot, is the API. Whilst the API hasn’t been standardized, the mechanisms that you communicate with across disparate tools broadly have with the rest API. There was the soap API and now the rest API and and there’s evolutions there too. Just the fact that you didn’t need to be a 30 years experienced engineer in one specific code language to be able to communicate with other technologies because of the advent of the API and more specifically mature APIs. I think that’s really been the thing that’s helped FinTech expand outside of being offered just by banks, certainly.

Jacob: And we’ll dive into APIs further here in a minute. But it was funny as you began that and mentioned that, you know, the ATM example is a great one of they all build on each other and getting the consumers kind of breaking down the wall of the consumer being okay with something before they can go to the next one. I was literally thinking back to, as I grew up, remembering the days where I would go with my mom or dad to the bank and they would demand to park, go inside and wait in line to get cash from the teller. And I even as like an eight or 9 or 10 year old, would be like, there’s someone that just went over to that thing right over there. It seems like they got it themselves and like they were like, No, this is like, that’s sketchy. This is how we do this. And then, you know, years later, they’ll be calling me like, Hey, how do I do such and such with my bank? How do I make this? How do I send you the money? And them getting more and more comfortable? But they have to kind of break it down one step at a time before we dive into APIs directly, let’s get some background info on Integrated Finance itself. Your tagline is the platform modern fintech is built on. What does that mean and where does Integrated Finance fit into the fintech ecosystem?

Daniel: Sure. So if I take it a step back a bit, there’s four co-founders of Integrated Finance and we all worked together previously, two founders and two early stage employees. And what we were trying to do was launch a currency exchange business that also could issue virtual accounts or FBOs, as they’re slightly more commonly termed in the states to our users. And our customers were particularly interested in the virtual accounts, more so than the currency exchange solutions. And they were very demanding. I want dollar accounts, I want euro accounts, I want sterling accounts, all the sort of things you can get from Chase Jp Morgan. But it’s much more difficult for, say, a community bank to offer anything other than dollars. And we’ve managed to build an integration with one bank super easy, you know. Well, actually, it wasn’t super easy. It was painful. But we thought, how hard could it be to try it again? We’ve learned all our mistakes. First time. There’s got to be some compounded expertise here. And what we learned pretty quickly was APIs, as fantastic as they are, we’re beginning to dissolve the standards that financial services runs on.

Daniel: So the most well recognized standard in financial services is probably swift. It’s the globally adopted way of communicating, interbank to confirm transactional information. And there’s new age of banking with APIs is dissolving that because every bank is a slightly different API. And what is. Rated finance. Integrated finance is the combat that problem. It’s trying to build a standard across this new layer of banking so that anyone trying to launch a fintech product or add a fintech product to their existing offering to increase value to their customers and attract new ones, they’re having to vet all of these vendors that have not dissimilar product offerings, but hugely dissimilar ways of accessing and utilizing those products. And so Integrated Finance is a platform that aggregates these banks, abstracts, the nuance and complexity of working with each so that the entrepreneur or the business unit that is trying to affect change in financial services doesn’t have to worry about the boring differences of each of these banks. It can focus on the important difference that their company is going to make in the industry.

Jacob: Interesting. Okay, cool. So let’s take that kind of a level deeper. You might have already partially just answered this question, but for small business owners or startup companies, sometimes trying out all these different fintech products on the fly, seeing what works best, it’s easy for things to get really messy for them if they’re not the most tech savvy or if they’re like, you know, they see this, they want to integrate this, they see this, they want to bring this in this tool. In What advice would you give to someone who might be trying to declutter, organize their APIs without breaking the bank accidentally getting rid of things that work alongside things that don’t? What advice would you give them of trying to bring all of these things into their life in an organized and successful way?

Daniel: So I would always start with who the customer is. Is the customer your finance team. And they’re complaining about inefficient ways of doing their monthly and year end. Is the customer your actual customer? And if it is, what parts of your system are they using the most? What’s delighting them and what is most frequently causing the pain? Or is it a partner or a supplier of yours? Learn whose pain you are trying to solve by an API is ultimately an automation of what minimum two humans would be doing on either side of that pipe. If you understand what those people are doing and what benefit the automation brings, you’ll know pretty quickly whether you should have automated it in the first place or not. The second thing I would say is we made a bunch of mistakes in the previous venture by trying to automate everything as we thought it should work in practice before actually using it in practice. And so firstly we were automating some processes that we didn’t fully understand because we thought it would be a good idea. And once it was running in live it, it didn’t deliver the value to the people we wanted it to because we hadn’t manually done that process ourselves. So if you’re looking to declutter first, go to your customer, whoever they are, and find out what’s the most important thing about this automation. You might find that they say, We never needed it.

Daniel: It’s just always been that way. The second thing is make sure you fully understand every step of the process that you are trying to automate away via this API. And then thirdly, once you’ve analyzed those two, you’re going to have a smaller pool of functions and productivity that you think you had and it’ll be very quickly you’ll be able to identify what is potentially not required for your service to continue functioning, assuming you’ve already done that and you need everything that you’ve integrated. But what you don’t want to do is maintain all of these disparate connections because one bank or one partner is constantly deprecating an endpoint and your engineers are going crazy because they just spent four months repairing it. You can look for awesome tools out there in the market whose job it is to maintain and update those integrations so that you don’t have to in the workplace. Most people have heard of Zapier now happier with Zapier, but there’s great tools like MuleSoft for enterprise customers and add Integrated Finance. We are hyper focused on financial technology and even more specifically on the issuance and orchestration of accounts and wire transfers. A lot of our customers use it, use credit and debit cards alongside our software as well, and we automate all of the cash that moves in between the card and the user’s account without our customer having to worry about which bank.

Jacob: Yeah, I’ll come back to the end of that transactions here in a moment. But you said something that’s been a bit of a common refrain in different fintech leaders that we’ve spoken to on this podcast, which, you know, you had that little story in there of you maybe got a little ahead of yourselves and putting something out before realizing what the issues might be, what is the testing process or the kind of rollout process for new services or products that you’re offering? Because that’s something I’ve heard before a few people talking about now, test internally, use our own tools ourselves is the best way to guarantee the moment. Then we roll them out to everyone where it’s going to work and we’re going to get the feedback we want versus like you had said, you rolled the one out and then you’re like, it wasn’t actually 100% ready. So the results we were getting back. Weren’t 100% valid either. What’s your kind of process or testing or possible rollout of something new?

Daniel: Sure. One of the things that becomes easier as you start to scale is you can identify commonalities between demand. If you have four customers, it’s not a vast set of information with which to verify your thinking. If you have 20, if you have 40, if you have 50 customers, you’re going to start seeing problem patterns where perhaps everyone’s answer to what they do or don’t like about your product is different, but you’re going to find it’s a different flavor of the exact same problem. And so one of the things Integrated Finance is very cognizant of doing is as we add new features, it’s not going to be something that everyone wants and vice versa. If there’s a change in process, maybe some of our customers have formed habits around those processes, whether they like them or not. They don’t want to relearn a new process. Yet there’s a clamor for new customers to say, Hey, there’s this obvious way that you could improve the service. Early on, we were very quick to respond to the demands of any customer to try and perfect it as soon as possible for everyone’s experience. But you can’t continue to do that because fundamentally sometimes a customer, two different customers will want the exact same process to work in a binary fashion. No, I want it this way. I want it this way. So the important thing is to make sure that you’re understanding every customer’s problem in as much detail as you possibly can, and then abstracting the themes of that pain and coming up with a solution that works for all, not trying to host ten, 15, 20 different versions of your software, which quickly becomes untenable.

Jacob: Absolutely. And so back then to the you mentioned transactions before. We’ll go to the kind of the payment side of things. I would assume every single person listening to this has made a purchase online with a credit card at some point in their lives. But I doubt that all of them realize how much is going on behind the scenes to provide such a seamless experience for the customer. Can you walk us through the different technologies needed to make card issuing and processing happen and how Integrated Finance helps manage those different technologies and APIs that are firing during that?

Daniel: Sure.

Daniel: So there’s really two sides to this ecosystem when eventually and I don’t know what kind of timeline this will be, there’ll be one. So you have the issuer sometimes called an issuer processor, and you have an acquirer sometimes called an acquirer processor. The issuer is job is to give the money. So the person doing the buying has a card issued by somebody, often a bank. And the acquirers job is to take the money and they’ll have a relationship with the person taking the payment. An acquirers customer is most commonly referred to as a merchant. This merchant is selling could be a chocolate bar in in the real world, or it could be a holiday online and effectively. The stewards of this process are called schemes and in certainly in the Western world, you’ve got three common schemes. You have Visa and MasterCard, which are termed open loop. That means you can use it anywhere. You don’t need to be deliberately connected to the same scheme, whereas American Express, which has far smaller volumes but far higher revenues, they typically own both sides of that relationship where they are both the issuer of the card, the processor and the acquirer for the merchant. And because they own both sides of that relationship, they typically can command far higher margins than the open loop environment where there’s more people to share the same processing revenue with. So now that’s sort of high level. At a low level, if you bank with somebody, pull out your debit or credit card and look on the front or the back, it’ll say who your issuer is. It’s usually your bank. But with the advent of fintech, more and more often it’s a third party.

Daniel: Their job is when you want to spend something, the acquiring bank has to validate that you have enough money and you are who you say you are so so that you’re not being defrauded. The issue is job is to say, Yes, I’ve got enough money and yes, it is me and there will usually be some sort of safeguard there. In America, they love a signature or a pin number. In the UK, we love security codes, but but there’ll be various differences anyway. It’s communicating with your bank or whoever your issuer is to say, Are you you and do you have enough money? There can also be some other validations. Like is the thing that the person is trying to purchase legal in that country. America is a pretty good one for state by state. There are differences in what is legal and what is not. The acquirer, on the other hand, job is to ensure that the person has enough money and pull that pull those funds off of the card and settle them in a timely manner. To a merchant. It’s job is also to ensure that its merchant is reputable and in doing so. Is unlikely to be overcharging or delivering a bad service. The schemes, for very obvious reasons, want to make sure acquirers are only dealing with the highest reputation merchants, because if all of a sudden a flood of scams or scandals or other illicit activity started happening on these schemes, all the people doing the buying are going to want their money back. It’s going to make Visa and MasterCard look bad and the scheme will quickly lose its legitimacy and start to deteriorate.

Jacob: Yeah, And early in that you mentioned the that was a wonderful overview. Thank you for that. You did mention, though, at the early part something that caught my ear that right now it’s this two sided but that in the future you possibly saw it as being one sided. What are you thinking along those lines?

Daniel: Sure. So most processors will not like to hear this, but fundamentally, there should be a single arbiter of are you who you say you are? Do you have enough money and is the merchant going to scam you or do they have a low quality product? It seems to me that the cost for merchants of processing, debit and credit cards has been stagnating high when everything else around us is being impacted by, let’s say, Moore’s Law, the cost of compute is dropping so dramatically, so, so rapidly that the fundamental cost to run these checks, in theory, should be going down, too. That is absolutely not reflected in the cost to the consumer of effectively a tax on increased prices because the merchant has to charge slightly more to accommodate for these high, fees and the merchant as well is forced to pay pretty heavy fees to be able to accept this. You’ve got fantastic processors out there, but they all charge 3 to 3.5%. That’s an obscenely high tax on what is one of the most common ways of paying for your everyday items. How can you bring that cost down? One, you could make crime go away. Humans are going to human no matter how good technology gets. So think we can safely say that that’s an unlikely expected output. Fraud detection tools can get even better. That can happen. But as it happens, humans historically have found more and more unique ways to get around that problem. And so ultimately. You have a series of middlemen. Who are fighting over the same volume. And in the grand scheme of time, it would make sense in my eyes for there to be a merge there somehow.

Jacob: Less of them then that could be passed on to the consumer and the merchant that hasn’t seen any of that gain over time.

Daniel: Exactly. It will take a technological advancement, no doubt. But at some point the market in theory should be technically able to go towards the American Express model without the American Express fees.

Jacob: Makes sense. And do you think it would be more companies that already exist going towards that model, or do you think it’s going to be totally new disruptive players that need to come in and say, no, this is the model. Only a few of you used it before, but we’re going to completely change this. And because I would assume either one of them, if they’re able to come in and do that and offer the merchant in the consumer, hey, the end result of us coming in here is better pricing and more success for you. They’re probably going to ultimately find their success doing so.

Daniel: If you asked me, say, five years ago, I would have said without batting an eyelid, it’ll be an incumbent who’s trying to gobble up another part of the market. That just hasn’t happened. And I’m pretty sure the technological capacity for it to happen exists now. I’m uncertain. I would think it would be a disruptive technology, potentially not a card technology that creates such a scare amongst the schemes that they have no choice but to compete on price to force this type of adoption. That would be my guess at the moment. And it could be a social media company that has 5 million users that just get such a high demand for its entry ecosystem payments that the only way for the schemes to compete is remove some of the links and the chain that caused this friction and high cost.

Jacob: And any time with any topic like that, I just my mind ultimately always just goes to Amazon and Alibaba of thinking of like they’re the ones running the most payments in the world that have the then technological infrastructure that if they saw that happening could jump in pretty quickly and say we can be the ones to do this. But before we go even further down that kind of tangent here, you mentioned fraud a couple of times, so I want to come back to that. Anywhere there are transactions, unfortunately, fraud tends to follow. As you said, I don’t think we’re eliminating that any time soon. It’s just an unfortunate consequences of us humans. There are a lot of fraud prevention tools out there, both front end back end to protect the consumer and the operations from fraud. However, that security can be delicate to balance against providing the smooth and fast payment experience that the consumer and the merchant both do also want. How do you view that balance in any best practice advice for fintechs or enterprises that are trying to strike that balance between I want security, but I also know we need to have this seamless speed available too.

Daniel: Sure.

Daniel: So if you a startup or if you’re in any way exposed to markets and need to be capital efficient, I would say buy off the shelf investing energy into non-revenue generating activity, which fraud is its revenue protecting, investing high resource into revenue protection when you have no revenue is a bad idea. Go and buy something and make sure it works, at least to the market standards. So there’s not a compelling reason to for, say, an organized gang to deliberately target you because they know that you’ve gone cheap and built it in-house and didn’t really know what you’re doing. And there are professional gangs worldwide that target. Look at the Lazarus Heist podcast. It’s awesome. If you want some more information on that type of activity,

Jacob: Also very scary but awesome. Yes.

Daniel: Absolutely. If you’ve gained a critical mass where you’re established, you’re generating significant revenues, then revenue protection becomes a much easier balance to invest in. If you’re making a million bucks a month or 10 million bucks a month, you do not want that revenue exposed to the types of risks that it may be. And at that point, it probably makes much more sense to internally assess what are the right tools for your business. You’re probably still going to want to work with some of the preferred well-respected companies out there because their job is to continually invest in their own tools. But doubtless your those are going to turn into ingredients into they’re going to turn from a meal to an ingredient. You’re going to use those tools in a special way that benefits you, that maybe all of their other customers aren’t using something. I’ve seen from a company recently whose name I shan’t mention, not because this is a bad idea, or they probably don’t want to know how their processes work is to lower cost. They they do extremely like KYC on onboarding, so they still want to know who you are, but they’re not going to. It’s not. Going to become that heavy duty investigation that many financial services companies do up front. But on your first transaction, that’s when the heavy duty checks will take place. And it makes sense because they’re humans are.

Daniel: A fantastic browsers. How many times have we gone into a shop and tried on something that we can’t afford or just interested in that? I’m sure there’s many a realtor across the world that can feel that pain. So if you think about yourself as a financial service, you will have a high number of people registering for your service. That, for one reason or another, may just never use you. Now, if you’re piling all of your energy and resource into validating that user at the front end and then you never get an ROI on it, it’s potentially a sunk cost. You’re also making it more difficult for those people who are on the fence to actually see what you’ve got. So maybe some approach can be do what you need to do to make sure this person is is not a scam artist or anything else. But. Perhaps encourage them into your eco system and then before you’ve exposed yourself to any transactional risk at that point, when you have the customer’s attention there in the platform, they’ve already made the effort to engage with your service. Maybe then is the time to start doing your serious checks. This is just something I’ve seen done that’s not advice on how to run your business. It’s just another way and a novel approach I’ve seen to a well known fintech operating.

Jacob: Yeah, and that makes total sense too. Like if you can’t remove some of these costs, can you at least push them back to when they’re actually necessary so that you’re not taking them on all and then finding out that none of them were necessary because that person is never going to actually interact with you. So it makes total sense. We discussed this a little bit earlier, but broaden it out or ask it directly. What would be your advice on how to go about getting that good, reliable feedback from your customers or prospective customers on the integrations that are actually going to move the needle for your business?

Daniel: So I suppose the most important thing is validating the use case. We’ve come across many customers who think they know what they want and the last thing you ever want to do is build something when it seems like a good idea. I think there’s a huge graveyard of man hours ploughed into ideas that were never fully validated nor ever explicitly requested, just assumed that this is desired. So I think get absolute certainty that what you’re building. At least has the opportunity to deliver the value that somebody’s requesting. You also want to make it as easy as possible for people to feed back in. In a previous venture. We put a heavy amount of reliance on the customer owning the feedback process. And it was a pretty stupid thing really. We thought, well, if it bothers the customer that much, they’ll put the time in to explain us why it bothers them. No, they won’t. You’ll often get an email saying this didn’t work, and if you send that information to the engineer responsible for solving that problem. Engineers are a different breed. Please show me the steps to reproduce this particular error. And if you then go to the customer and say, take time out of your busy day to show me the exact steps. No, no, you’re in the wrong browser. Go into the other browser. No, you’re using your iPhone, You’re using your not going to happen. You need to take the most possible friction out of that process as possible. Now, an idea I’ve been playing with which will never come to market was was something I saw in a in a documentary. And basically, I don’t know if you know David Attenborough. He’s a he’s a treasurer over here in the British Isles.

Jacob: Still quite popular here in the States as well. All the documentaries, everything very popular.

Daniel: Sure. So at one point they realized people actually really quite enjoy figuring out how this stuff was filmed. So they do segments at the end to show how it works. And there was a cameraman trying to film a I think it was a killer whale surfacing, or it might have been a blue whale surfacing or it might have been a great white shark. I’m not sure. Either way, it didn’t happen very often and it was very, very quick. So they invented this camera that the video camera, once the camera guy would pull the trigger, it would record from three seconds previous. So when the whale breached, it would breach and gone down. It would still capture it. Now, one thing. That I would love to see and a feature I would love to see built is that specific feature. So when a customer has that issue, there would be a nice little button where they could click record and it would capture the last five to 10s of what they’ve just done. That is not possible in heavily regulated environment, which is why I said it wouldn’t fly. But there’s probably a lot of software tools where with the express permission of the customer, you can capture the entire screen of what they’ve just done or the entire tab and feed that into the team responsible for fixing it. If you work in an industry where that’s a possibility. I urge someone to consider having a video capture of the problem because in complicated API related businesses it’s very difficult to understand was it the user, was it a bug on our side by definition because of an API? Was it a bug on the other side of what the API is talking to? Was it a bug on the API itself? Is what you’re even doing even possible? There’s so much nuance and variables that you’re really for every specific issue, it’s a needle in a haystack without more context. And it’s important for you, whatever your business is, to make it as easy for the person to layer the context on as possible.

Jacob: Yeah, and man, that’s fascinating in the camera. Technology makes sense. And like you’re saying, I can see why you’d say it wouldn’t. It would be very hard to get that to be allowed or to get people to buy into that because ultimately what that’s doing is it means it’s always recording you. And when you hit that button, it has the previous three seconds and at some point it says after 10s we can delete the whatever. But it is giving that permission for something to always be recording. But as you said earlier, when you were five years ago, you would have thought something very different. Five years ago I would have told you, You’re crazy. There’s no way in mass that us humans would allow someone to just be recording everything that’s going on on our computer at all times and trusting them that it’s actually going to be deleted. But now in 2023, there’s a lot of things like that and we’re pretty quick to click I agree, agree with something, and then it’s years later that we’re like, maybe we shouldn’t have been agreeing to that. Can someone go to court or do something or whatever. So maybe. But it definitely the good version of that I think would work in a great way of being able to provide that needed feedback and make make that connection between customer who has no time for you to be like, I can sit down and explain exactly what went wrong. Something went wrong. The last thing I want to do is talk to you anymore. I’m done with you or your company, but connecting them to that person who could actually fix it for the next one would be super interesting. Well, Daniel, we’ve touched on a lot here. And before we go, any other trends in the fintech world you’re kind of keeping an eye on in 2023 and beyond that, Integrated Finance is trying to stay ahead of the curve on.

Daniel: Yeah, there’s tons. One of the things that we’re really seeing proliferate not just in fintech, but is the as a service model of anything. Yeah, typically, often people refer to it as moving up the value chain, becoming the layer, becoming the infrastructure, as opposed to serving the customer. In the US, you’ve probably seen guys like Treasury Prime Unit Bond. I think there’s a company called Cinque Terre all doing great jobs of abstracting some of the complexity of working with these community banks. You’re not really seeing it at the Tier one level. Much larger banks simply can’t get comfortable with the delegation of that type of risk. So you’ll see bigger banks try to white label their platform but own the customer and in doing so, own the responsibility if something goes wrong. In Europe, the service scene is slightly it’s similar, but different. In Europe you can actually connect to the direct payment scheme itself. So it in the States, who’s the arbiter of money movement across the state? It’s the Fed. Fintechs can directly connect to the UK and European equivalent of the Fed. So that’s resulting in a slightly different bubbling up of relationships between banks and fintechs here. But really what we’re seeing is. The banks themselves, much like the ATM that we referred to in our previous example, they’re creating opportunities to distance themselves from the customer direct. It started off as a way of making the customer’s life more convenient ATMs. It then moved towards just reducing the high customer service cost of dealing with these thousands of customers, mobile apps and branch closures.

Daniel: And that trend seems to be continuing and continuing where the bank is seeing the value of having other companies aggregate large pools of their customer bases, creating something slightly more bespoke and niche to increase the engagement of those customers and also maybe somewhat negatively when the problems occur. It’s not the bank’s problem. Hey, you onboarded that guy your problem? Or when the customer is unhappy with the service, it’s not us. We’re the bank. You go talk to the fintech that you have a relationship with. The service is really the continuing trend of the bank distancing themselves where anyone but the highest net worth entity or individual possible. If you’re Bill Gates, I’m pretty sure he can go into a bank branch if he really wants to. If you’re Apple, you’re going to get the services that you require to the best level unparalleled from the banks that you require. But if you’re a small business or even a mid-cap business. The as a service industry is now going to be your home for placing your dependents and your trust. I do think that is going to continuously be. Painful over the next 3 to 5 years. We’re already seeing the Silicon Valley banks scare everyone back to the big banks. We’re seeing the issues with Credit Suisse scaring everyone back to the extremely well capitalized big banks. But in the grand scheme of time, it is my assertion that banks will regress to become almost their original purpose, which was vaults.

Jacob: Storage. Yeah.

Daniel: Safety nets and storage for your capital. And it will be a new layer of fintechs who are in the beginning hyper specialized in solving a subset of problems for a smaller and smaller addressable market. And because the world moves in cycles, some of those guys will get very successful and buy up their competitors and it will probably look and smell and feel a lot similar to how it did ten years ago in 20 years. That’s my assessment.

Jacob: Wow. Love it. Great big picture there. And I got to say, I’m in pretty much all agreement with everything you’ve just laid out and love that you also brought it full circle back to our original ATM example. So well done with that. This has been an absolute blast. Daniel I’ve really enjoyed our time here. For those listening who may be interested in learning more about Integrated Finance or who may want to follow you, your journey, everything you got going on, where would be the best place for them to go to do so?

Daniel: If you don’t like to talk to people, you can just go on our website and click Open a sandbox. If you do like to talk to people, you can click to the right of it and click book a demo. All you really need to tell us is a little bit about your product so that we don’t create a configuration that has absolutely no relevance to you or book time. With one of the sales team at Integrated Finance. All of the team are super, super knowledgeable on the nuances of all of the banks. Super, super knowledgeable and all of the fintechs. We pride ourselves on being the bank’s best sales guy and the fintechs best sales guy by ensuring every customer that we integrate with a bank fully understands what the bank can and cannot do, will and will not do, and how it works in reality versus everyone’s website is can be somewhat guilty of making it a look a lot shinier than it often is. We just ensure the customer gets the experience that they deserve. So yeah. W-w-w dot integrated dot finance. That’s us.

Jacob: Love it. Awesome. We will link to all of that and more in the show notes for listeners to take advantage of. Daniel, thank you so much for your time and knowledge and our listeners appreciate it greatly. Hope to speak again sometime soon.

Daniel: Jacob, Thank you so much for having me. It’s been a real pleasure. Really appreciate it.

Jacob: If you enjoyed this episode and want to hear more, head on over to to subscribe on your podcast listening platform of choice. That’s s o a r p a