Digital will be a convenience but plastic will remain in vogue albeit the drop in their usage, says Ramanathan RV, CEO & Co-founder, Hyperface.
In an exclusive interview with Sanjeev Sinha, Mr Ramanathan gives his views on embedded finance, the relationship between banks and fintechs, and whether digital solutions will truly replace the emotional connection with a credit card. Excerpts:
Banks are competing to embed financial services into everyday apps. But how can it be made seamless and secure without sacrificing the user experience?
Banks are increasingly embedding financial services into everyday apps, achieving seamlessness and security without compromising the user experience. Preserving data privacy is sacrosanct for the sustainable growth of embedded finance. Banks must continue to invest in the scalability and extensibility of their systems while fintechs have to accept end-to-end encryption of data as a reality. When the ecosystem operates within these essential guardrails, then innovation will thrive.
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How can credit card as a service elevate instant rewards to create authentically personalized experiences, ensuring not only user engagement but also fostering unwavering loyalty?
One of the key pillars of BaaS (and by extension CCaaS) is delivering realtime experiences to customers. This was a key reason for the success of third party PSPs (Payment System Provider) in UPI. Realtime transactions & rewards is an enabler of user trust and this is acutely needed for financial institutions that are growing rapidly among users. A credit card gives rewards to customers for every transaction. And ensuring that the reward is being given is akin to keeping the promise which fosters loyalty of the customer towards the payment instrument. Hyperface’s innovative platform enables banks and brands to create such hyper-personalized and rewarding credit card experiences that drive customer engagement and loyalty.
Plastic cards are no longer in fashion, but what about the physical touchpoint? Can digital solutions truly replace the emotional connection with a credit card?
Plastic cards will continue to exist even though customers may shift to mobile-based tap & pay or QR scan & pay. The design on the plastic/ metal servers as an expression of their identity among the customers. In my opinion, we will begin seeing a lot more innovative designs of the card in the coming years. Digital will be a convenience but plastic will remain in vogue albeit the drop in their usage.
In embedded finance, banking transcends traditional boundaries, ensuring security. How can financial solutions establish and strengthen trust within the complexities of a fragmented financial ecosystem?
Embedded finance is still very nascent in evolutionary terms in India but carries a lot of promise. With every implementation, the whole ecosystem will learn and evolve. We also learn from the experience of Open Banking implementations in our own country and across the world. The regulator has played and will continue to play a key role in guiding the ecosystem to implement a robust governance framework to protect customer data, prevent fraud and reduce abuse.
In your opinion, are fintechs challenging or collaborating with traditional banks to unlock a financial future for everyone?
I believe the relationship between banks and fintechs is symbiotic and mutually beneficial, with both sides leveraging each other’s strengths to create better financial products and services for customers. Fintechs bring fresh ideas and cutting-edge technology, while banks provide stability, trust, and regulatory compliance. This collaboration allows for faster innovation, improved customer experience, and increased access to financial services for consumers. Banks offer a myriad of financial products but the customization of these products to suit the needs of customers is done much more rapidly and efficiently by fintech companies.