Interview with BPC on the potential of emerging markets to drive digital transformation

Thursday 9 May 2019 10:37 CET | Interview

The Paypers sat down with Evgenia Loginova, BPC Banking Technologies, and discussed BPC’s work in boosting fintech adoption in emerging markets

Can you tell our readers a little bit about BPC and its origins? How has it developed into the global company that it is today?

BPC was purely a payments technology vendor for over 20 years, but with the evolution of the payments market we have found that it takes more than just providing the technology to your customers if you want to really scale your business.

To scale in the fintech industry, you either need an extremely large customer base or a technology that can cater to needs across the entire ecosystem, outside or adjacent to the payment needs. Therefore, we have evolved from being just a technology provider to an actual stakeholder in the ecosystem, using our technology as an instrument to drive the industry.

Our mantra is ‘bridging real life to digital’. This is important, because whereas people usually think of progressive Innovation with relation to fintech, we have a slightly more conservative approach towards throwing around words like ‘disruption’ or ‘innovation’. Ultimately, the purpose of any innovation or technology is to solve the real-life problems of people and businesses and help them move forward.
When presented with a great-looking demo we first ask ourselves: what problem is it trying to solve? What is the business that you are trying to improve?

We are heavily based in emerging markets (EMs) from Eastern Europe, Asia, Africa, to the Middle-East. And we are growing rapidly in Latin America, too. We have many operations around the globe, that all function through solving real-life problems. A notable example is the case study of money transfers in Indonesia.

Indonesia is a nation with 270 million citizens with an annual GDP growth of over 5%, one of the major economies in the EMs. There is still a lot to be won: 180 million Indonesians do not have a bank account or smartphone. We tried to aid financial inclusion by developing a payments platform, allowing Indonesians to make P2P payments, as well as simple payments like social insurance using a phone instead of going to a bank.

BPC boasts a wide reach, serving both rural and urban areas; what key challenges have you identified in these two spaces?

One important thing that we have experienced from our 20 years of work in rural EMs is that small and medium-sized businesses (SMEs) are the backbone of emerging economies. However, when we see businesses like that in India or Kenya or Ecuador, they all struggle to gain access to working capital. This is because the traditional way of getting working capital is through a bank, which means you need to get a lot of paperwork done, open the account and get a credit check. The majority of businesses do not have the resources to do this, so on the one hand banks are missing out on a very large customer base, and on the other these SMEs cannot grow.

When faced with this problem, we developed an online platform for local players, such as farmers, that connects them to investors, as well as suppliers and other supporting businesses. This way, we build an ecosystem where people quickly, safely and easily can connect to what is relevant for them at that moment in time: buy, sell, add info, access to capital and more. For example, if a walking farmer wants to order seeds, he can do so by ordering them at the supplier and pay for them with money from the investors, all in the same platform that we created.

However, when looking at urban markets, very different needs arise: urban people are busy, so we want to remove friction from their lives and create clarity in a sea of data and speed. In Dubai and Asia we are currently working on simplifying transport: buying tickets for a train, a bus, and a tram can now be done by one instrument that stores your ID and payment information. This way, we are removing friction.

BPC is historically big in emerging markets and is now developing their offer for developed markets, such as the UK. What lessons from the emerging markets are you bringing to the developed markets?

Bill Gates has said many times that most of the innovation in financial services is happening in the EMs, where they adopt new technologies a lot faster than in Europe or the US. Especially the adoption of mobiles for financial services is remarkable: P2P transfers, lending, online banking: people in EMs have been using these services for years now and they are only just breaking through in the developed markets.

There used to be a prejudice, especially in senior banking staff, against innovations from the EM world, but lately people are becoming more and more receptive to the news that we bring from the success of projects in the EMs.

And the EMs do not just function as a ‘proof of concept’ for specific technologies; people in the EMs have very high standards when it comes to time and quality of their services. Furthermore, there is less legacy and more willingness to change. In that sense, the developed world is a victim of its own early success. Here, we tend to automate existing processes rather than rethinking them and that slows down innovation substantially.

The people that are working on our projects are people that have been with us for a very long time, and who have a wealth of experience. This wealth of various experiences accumulates and all of it eventually becomes relevant.

From what you’ve seen globally, what do you mark as the most important challenges and opportunities in fintech today and in the future? What role do you want to play in the market?

Now that the hype of fintech has settled down a bit, the biggest challenge for new fintechs that enter the market is to last and make a difference. A lot of those fintechs are venture investor-backed, and those investors will want to see returns quickly, but eventually it will be the companies that have long-term plans that will make that difference and succeed.

This creates a good opportunity for us: while we have been a little shy in the marketing space, we have always focused on providing credibility to our services and showing the world that our solutions work. Now that the entire market is becoming much more vocal, we have 20 years of experience and a presence in nearly 80 countries to show to the world. We may not provide the fastest growth, but we want to create the most meaningful growth, one that generates business for generations to come.

About Evgenia Loginova

Evgenia has been working with payments technology BPC for over six years now and is globally responsible for strategy, marketing and commerce. She is successfully leading the technology company commercially through the rapidly-changing landscape of payments and banking.
Before that, Evgenia worked with Goldman Sachs as an executive director. She studied Management at the London School of Economics and is based in London.

About BPC Banking Technologies

BPC was founded 20 years ago and as true ‘globetrotters in fintech’ it is now active in nearly 80 countries. For more than 200 clients, BPC powers payments across the globe by supplying software and creating ecosystems in which banks, processors, merchants and other ecosystem players, such as governments, can thrive. BPC is bridging real life to digital. Banking, Payments: Context – this is what and who we are about at BPC. It’s all about creating relevant services for the customers of our clients, fitting in the context of their business or daily life.

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Keywords: Evgenia Loginova, BPC Banking Technologies, interview, fintech, digital transformation, emerging markets, fintech industry, Eastern Europe, Africa, Asia, urban markets, payments methods, access to capital
Countries: World