Bringing technology expertise to banking

Adyen’s new embedded financial products enable platforms and marketplaces to create tailored financial experiences, unlock new revenue streams, and increase user loyalty

Elly Yates-Roberts
Elly Yates-Roberts
By Elly Yates-Roberts on 13 October 2022
Bringing technology expertise to banking

When financial technology platform Adyen was founded in 2006, its goal was to improve the payments experience by building the entire payments flow onto one platform. 

“The idea of ‘one platform’ is now an industry buzzword in business technology,” explains Hemmo Bosscher, vice president of platforms and financial services at Adyen. “For us, it basically means that we take on the payment on one side, and hand it off on the other, and there’s no trail in between.”  

Since Adyen’s foundation in high-end enterprise payments, things have changed.  

“Shoppers’ expectations have changed quite significantly in the last decade,” says Bosscher. “When mobile phones became more integral to our daily lives about 15 years ago, I know that I expected very little from online interfaces. It was normal for them to be clunky and slow but if that happens now, I am very put off from ever returning to the website or application.”  

This evolution has unfolded in stores too. Not that long ago, it was nigh impossible for a customer to return items purchased online, in stores. Today, the majority of consumers expect it. “Luxury brands like Gucci or Prada were the first to offer these services to enhance the customer experience,” says Bosscher. “But quickly, these became business-critical in the mass market. It’s now what shoppers have come to expect.” This is how retail and financial services organisations have been able to deliver unified commerce and omnichannel offerings.”  

The oft-ignored back-end technologies used by businesses are critical to meeting customer expectations. “This can be seen with the success of the likes of Microsoft Dynamics 365, Toast or Lightspeed – and even platform businesses like eBay,” says Bosscher.  

He believes that these platform services have also democratised access to premium payments journeys: “Small boutiques are now able to offer a similarly personalised and seamless experience as Gucci.” 

The Covid-19 pandemic brought a further shift in the market. Not only were retailers and other brands forced to meet customer expectations in new and more innovative ways, but it has also driven an increase in entrepreneurs and small-business owners setting up shop.  

This reality is paired with the fact that these businesses are increasingly being run through platforms, which is a key reason why Adyen expanded its offerings in embedded financial products. 

“Traditional banking services aren’t necessarily the most appropriate anymore for this part of the market,” says Bosscher. “These small businesses and entrepreneurs are increasingly open to receiving financial services from the platforms they already use to run their business – these are brands and portals that they trust. It enables them to access meaningful financial services at relevant intervals.” 

Building on these realities, Adyen’s new embedded financial products include Adyen Capital, Adyen Accounts and Adyen Issuing.  

“The usual loan application process with traditional banks is really quite archaic, even unfair sometimes,” says Bosscher. “There are a lot of inequities and biases. Adyen Capital provides businesses with loans that are available and paid back quickly, in a very transparent manner – entirely based on incoming fund flows. This is made possible by the fact that Adyen’s financial products are always paired with its core payments offering.” 

Businesses can also access the new Adyen Accounts – which acts as a business bank account and enables instant settlement of incoming funds – as well as Adyen Issuing. The latter will enable customers to access virtual and physical cards, including one-time cards to pay suppliers and employees.  

“We’re not building these products to go super deep into banking,” says Bosscher. “Instead, they will function as value adds to platform users in the daily operations of their businesses. 

“For the platforms themselves, we can help them increase stickiness with their users and create new revenue streams.  

“We felt that building these new embedded products was a no-brainer for us with our technology and expertise – an elegant way of catering to growing demand; there are more platforms, there are more SMBs on those platforms, and there’s an increasing appetite to bank in more innovative ways.” 

This article was originally published in the Autumn 2022 issue of Technology Record. To get future issues delivered directly to your inbox, sign up for a free subscription.

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