The Re-bundling rhythm varies by region


Efi Pylarinou is the founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer – No.3 influencer in the finance sector by Refinitiv Global Social Media 2019

As technology commoditizes products and services at an ever-increasing rate, the re-bundling of fintech services is trying to catch up with the rhythm.

In the US market which has more unicorns and later-stage fintechs, this is more prevalent.

SoFi first comes to mind, which started with a laser focus on refinancing student loans (a large sector in the US market), then offered personal loans and mortgages; and then grew a wealth management offering that includes, equity investing, issuing ETFs, crypto investing; and a sizable Money offering with a debit card, a credit card, a checking account, savings accounts; and partnerships with brands like Mastercard, Samsung, Lyft, etc.

Wealthfront, one of the two standalone `robo-advisors`, that as early entrants and purists have advanced and impacted the entire digital investing space; has added direct deposits, saving accounts, prepaid and debit cards, personal loans and mortgages.

In addition to the business need to monetize pushing towards rebundling, there is also a consumer push towards convenience. The latter means that customers in the attention economy want to be served seamlessly anywhere and in a personalized way. SuperApps are the natives in the East and their approach has been strongly validated during the recent crisis. The West is on its own journey that is broadly speaking A Rebundling which varies by region and is shaped by regulations and culture – see Open Banking, PSD2, ect.

Even though Europe is ahead on the progressive regulatory front, the rebundling is broader and deeper in the US. I already mentioned SoFi and Wealthfront, but there are other grown-up fintechs that are seriously rebundling especially from the payments sector. For example, Square`s Cash App and Venmo both with small business Saas offerings and now with debit and or credit cards and crypto investing.

In Europe, the first Big name that comes to mind as A Rebundling example out of Europe is Revolut and then Transferwise. Both native exchange money transfer disruptors originally who have grown geographically, and now have debit and credit cards. Clearly Revolut is the most aggressive rebundler originating out of Europe, as they have added crypto investing, commodity investing (gold and silver for now), low cost stock trading, the micro-savings Vault offering, and insurance. Not to mention their plan to apply for a UK banking license.

Transferwise claims that they are not going to go after a banking license however, they are integrating investment features over the next year.

I can’t think of a Wealthfront rebundling example in Europe. Zopa the p2p UK lender is an example of rebundling that originates from the lending space (similar to SoFi). Even their branding has changed to FeelGood Money as they have added savings accounts and credit cards and their motto is about simple loans & investments. And the Zopa family now counts a UK licensed Bank, the Zopa Bank.

Another European unicorn that seems to me to be steadily rebundling is Raisin, the savings disruptor out of Germany that is getting close to counting 100 partner banks. Raisin is adding investment products like ETFs and pension products. Raisin has not only grown its direct to consumer offering but also its B2B offering. A Saas for banks and credit unions that US entities can use to digitally and cost effectively grow their deposit and savings businesses.

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