Most FinTech firms that started out a decade ago came to market with a single, easy-to-use financial product that customers loved — whether it was stock trading, money transfer or international card payments.
Over time, however, those services have expanded with additional products and services as firms sought to grow their businesses, evolving into what is known today as “super apps.”
But while these ecosystems of products and services have led to massive growth in revenue and value, Neeraj Baid, co-founder of U.K.-based money transfer startup Atlantic Money, said they are too complex and are geared towards solving problems for companies and not customers.
“Customers do not want four additional [substandard] products to get in the way of the original service, [which then] ends up getting muddied over time and [becomes] less attractive to the core customer base that really valued it at the beginning,” Baid told PYMNTS in an interview.
See also: Former Robinhood Employees Launch Fixed Fee Transfer Service Atlantic Money
When it comes to cross-border money transfers, for example, he said that customers mainly want the lowest fees possible and “they’re not asking for a money transfer app where they also have a credit card [or] an insurance product.”
The ideal scenario for customers, he added, is to have distinct individual services to ensure that each experience is optimized and targeted to their particular use case.
It’s a strategy Atlantic Money has adopted, recently launching a low-cost money transfer mobile service which Baid said will enable U.K. customers to transfer up to £1,000,000 abroad for a fixed fee of £3, helping them save up to 99% on their cross-border payment costs compared to other competitors.
“Everybody’s either giving you a crappy exchange rate or they’re charging a percentage of your transfer,” he explained. “We’re doing neither. We’re charging a fixed fee giving you an institutional midmarket live exchange rate.”
Launched in October 2020, the London-based FinTech firm recently announced it is now authorized to operate across all 30 European Union and European Economic Area (EEA) member states after securing a license from the National Bank of Belgium, accelerating its plans to expand across the region.
Segmentation, Targeting, Positioning
When it comes to trends shaping money movement, Baid said while the first generation of remittance players were all about digital innovation and competing against banks, the new wave of FinTech firms like Atlantic Money will not only challenge the first wave of FinTechs, but build more tailored, specialized and segmented products for distinct groups of consumers.
“Even if you look at some other elements of finance that are very mature, like credit cards, [they] have become more and more segmented over time [with] specific credit card products for specific types of customers,” he said to further drive his point home. “[For example], Amex does a great job at one end of the market, [while] Visa and Mastercard do a great job in other parts of the market.”
Simpler and cheaper solutions will eventually become the norm, he added, with more innovation in the quality of the product delivered.
Related: Innovation Bodes Well for the Future of Digital Commerce
Moving forward, Atlantic’s goal is to move beyond enabling European and U.K. customers to move pounds or euros abroad to enabling U.S. dollar transfers, which he noted are currently in high demand.
And on its journey to building a financial conglomerate, evolving into a mobile application that provides multiple products and services will not be a consideration at any point in the future. In fact, Atlantic Money is the antithesis of a super app, Baid said.
“We want to build a series of independent products, all of which are best in class, focused on their target consumer [and] don’t get in each other’s way.”
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