When was the last time you handed a banknote to pay for a transaction? Cash is receding from view, and the pandemic - with its anathema on touching anything, has accelerated our clicking and tapping into the digital economy.
Fintechs and neobanks that had already started this process are now literally cashing in on the soaring usage of digital wallets, while
the World Bank says digital wallets will account for 51% of consumer spending by 2024.
We’ve seen a steady uptick in the number of fintechs reaching out about - and getting creative with - e-wallets. These trailblazers have just Mambu to illustrate exactly how creative you can be with the functionality. They are tailoring their services to the specific needs of their demographic: panEuropean digital bank N26 lets its customers easily split bills and retroactively recall payments you want to settle in instalments, a kind of buy now, pay later feature.
Hay bank in Australia may have considered the post-lockdown travel wishes of their customers when they set up a digital wallet that allows them to see their balance in local currency and better keep track of their spending. Users can easily tap on their screen to enable ‘travel mode’.
In South America, Argentinian Naranja X and Brazilian banking conglomerate Itaù are using digital wallets to make flexible banking a reality for millions of consumers by simply migrating many time-consuming activities to their apps. Those are immediately available for download, and can be set-up in minutes from opening and offer fluid and secure possibilities to send and receive money when shopping or selling online.
So, is this the dawn of a new era, or the end of one? As these pioneers all run on Mambu, we’d say it’s the dawn of a new approach.
Digital wallets allow people to make electronic transactions, but they are not just convenient for technology’s sake. They help reduce frauds, they save time, they can do everything you’re doing with cards (including loyalty cards) and, maybe more importantly for our time and age, they provide a speedy checkout without the need to type long identification numbers. So, is it difficult to build one?
No, but it is essential to understand the product roadmap and the main business differentiator. Using Mambu’s composable approach reduces risk and increases the probability of success, regulating the application scope of each solution from CRM, ERP, to core and channels.
The key is to first design an architecture that is open and simple, identifying the scope of each solution, and recognise execution capacity, in order to establish where resources are needed (buy vs. build). A decoupled architecture between channels and backend systems will be fundamental to be able to scale quickly.
Our composable approach has helped companies report a 25% boost in productivity on Mambu in the first 6-18 months. Along with 95% improvement in delivery of functionalities, 85% reduction in time to launch new products and 70% reduction in operating costs per user - compared to traditional banks.
With the increasing interest of big tech to join the financial space, there's a big prize waiting for the companies ready to convince us to completely ditch all our metal, paper and plastic for something more 21st century like a digital wallet.