The importance of value-added services in banking and insurance

Monday 20 December 2021 08:38 CET | Editor: Vlad Macovei | Interview

Sören Timm, co-CEO of Etvas, runs us through the company’s mission, history, and future alongside presenting the challenges and benefits of the value-added services market

Who is Etvas and what is the Etvas story?

Etvas is the first digital platform for embedded automated value-added service offers. We have created a digital solution for banks and insurance companies to enhance their product offers. And we founded Etvas because we believe products in banking and insurance become more and more replaceable and the world increasingly impersonal; and we just want to help banks bring back more personalised experiences into the everyday lives of their customers; and because banks and insurance companies are operating in an environment where customers demand highly-tailored offers, that support their plans or that supports them in their daily lives. Customers definitely expect to get offers that match their individual needs. And whatever they get offered, they expect to be offered by a very intuitive digital tool. 

I built an assistant service company for the last 10 years, and when speaking to banks and insurance companies, we found out they all wanted to offer more to their customers than just banking and insurance products. But they lacked a strategy, they didn't know what to offer. So, they went to the market to look for different service partners, like ours, and started to integrate different offers one by one into the technical ecosystem. And we were stuck in many projects, where it took up to two years to be integrated into cards, accounts or insurance policies, or our service was offered often to the wrong customer client groups. 

Also, the pickup rates were low, the customer experience was bad because if the customer was offered three different services, they were sent to three different websites to use them. So, it was a mess in the market, actually. 

Then, I decided to change this. And it happened in Amsterdam in 2018, at the Digital Insurance Agenda Conference, where I pitched a partnership with an insurtech at that time in my corporate role. I got to know Ilie, from Thinslices, who was then in his role as founder and manager of a software development house. He had done 200 international projects globally and came to our booths and of course wanted to strike a deal for developing a product, which I really liked. I thought it's a great opportunity to develop something that banks and insurance companies need and it happened that we both became fans of this solution. 

Therefore, Ilie decided to leave his software development MD role, by putting a management team in place and we founded Etvas together - the marketplace for value-added services. 

And since the end of 2019, we were fully bootstrapped up until the point when we went live with the first business partner - Sparkasse Bremen, in the midst of the coronavirus crisis in 2020. And only after the proof of concept, we decided to do a pre-seed investment round. And this is how it all started. We raised EUR 1.1 million at an early stage, with four investors, started building a team, and since then have won seven enterprise deals in four geographies. 

What makes Etvas unique? Who are your direct competitors? What are the main target groups of Etvas?

We are the only self-service platform that offers customers of banks and insurance companies deals, offers that are relevant to them automatically, by applying machine-learning and AI. So, based on transaction data and other quantitative data, our solution offers users the right service or the right offer, which can also be a cashback offer to save some money, when and where needed. Service partners can onboard themselves into our platform within one day - we have opened interfaces or external apps that business partners can use for an immediate start of a service programme, for example. So, it's 100 times faster than it used to be. 

Value-added services represent a huge market in Europe, a EUR 30 billion market. The competition that we see is not with traditional players, but with very good service providers. In terms of an Open Banking, self-service platform, we are unique. There are some marketplaces or platform businesses like Miracle from France, who are more focused on physical goods, but could also extend into service offerings. We see that payment providers or account aggregators go into this direction of adding value to aggregated account data, normally known as finance manager apps. But still, I would say we have a unique position here.

Our main target groups are banks and insurance companies - both traditional and new to the market businesses. So insurtechs, neobanks, traditional insurances, and traditional banks, because they have different pain points. Traditional businesses need to retain their customers and they need to increase their customer loyalty. And new entrants to the markets - they have very high costs of customer acquisition, as they sometimes lack a real USP, which they can create with our value-added services platform.

What is the future of Etvas and what is the plan for 2022?

We will scale on with our enterprise sales activities to win more enterprise customers for our data-driven value-add service platform. We will grow to 50 business partners. And we'll have a three-digit number of services in our marketplace that are offered to the end customer via our AI tools. Also, business partners will offer their services through our app that are relevant to their users - like key depot, card blocking services, and many others; these services will provide cashback payments. Through our own proprietary solution, customers get cashback directly to the bank account for purchases done with merchants from our cashback network. 

Our platform can help banks, insurance companies, and e-commerce companies in the development of digital ecosystems or living worlds around topics such as housing, life, security or even sustainability. 

About Sören Timm

Sören Timm is the co-CEO of Etvas. He has held leadership positions in financial services for over 20 years. At the Royal Bank of Scotland, he was co-responsible for the wholesale business and in the extended board of GE Money Bank he was in charge of product management. For the English CPP Group, he also built up the area of additional services for security products as Managing Director and Country CEO.

About Etvas

Etvas is a digital B2B2C marketplace for additional services with which banks and insurance companies operate digital ecosystems that add value to their services and increase customer loyalty. Depending on the requirements, the services can be booked at fixed monthly or annual fees or can be issued in a bundle with other products. The platform is offered as a white label solution and can be integrated into apps and websites of banks and insurance companies via a simple API interface. Etvas was founded in Hamburg in 2019.

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Keywords: banks, embedded finance, insurance, digitalisation
Categories: Banking & Fintech | Online & Mobile Banking
Countries: Germany
This article is part of category

Banking & Fintech