Fintech
Exploring the intersection between FinTech and E-Commerce
He talks about the growing adoption of Buy Now, Pay Later (BNPL) services and the emergence of Open Banking, providing ideas for the development of fintech.
– Devansh, can you share a little about your background and what inspired you to co-found Fam?
– Safe! My fintech journey began with a simple desire to address the challenges faced by both e-commerce merchants and consumers in the rapidly evolving fintech landscape. There were basically two main triggers, witnessing the growing popularity of Buy Now, Pay Later (BNPL) services and recognizing the potential pitfalls of predatory lending, I firmly believed that this was not a sustainable business model and is prone to the pitfalls rather than the advantages it promises to bring. Secondly, after the launch of Open Banking, which is essentially instant account-to-account payments without the involvement of a credit product, I realized that this was a far superior financial services product and that if technology solutions were built leveraging Open Banking, it had the potential to truly disrupt the fintech ecosystem. UK regulators have worked hard to achieve consumer adoption of Open Banking, but without a profitable incentive this has been impossible to achieve. It was then that I saw the opportunity to co-found Fam with the vision of empowering both merchants and consumers through a responsible and rewarding way of payment.
– Fascinating. Can you explain how Fam’s platform works and the benefits it offers to merchants and e-commerce customers?
– Fam’s platform leverages open banking payments and data-driven insights to incentivize responsible spending and reward customer loyalty. For e-commerce merchants, Fam enables zero-cost payments and provides access to valuable customer data, allowing them to better target and retain customers, resulting in lower customer acquisition costs. Meanwhile, customers benefit from the ability to earn in-store credit through their purchases, fostering a sense of loyalty and because these are account-to-account payments, customers end up purchasing only the products they can afford, thus encouraging financial decisions responsible. We’ve also aligned our revenue model around this behavior, e-commerce merchants pay us a small commission if and when a customer returns to redeem store credits earned by Fam on a returned purchase. If our platform is unable to generate repeat sales for merchants, they will continue to enjoy free payment processing forever.
– Sounds like a win for both sides. How does Fam differ from other fintech solutions on the market?
– One of Fam’s key differentiators is our multifaceted approach to empowering both merchants and consumers. While responsible spending is certainly an important aspect, our platform goes further by providing merchants with valuable insights derived from anonymous financial profiles and user groups. This enables merchants to make data-driven decisions that lead to reduced CAC and increased customer lifetime value (CLTV). Ultimately, Fam offers a holistic solution that addresses the needs of both merchants and consumers in today’s digital economy.
– Absolutely. Can you share any recent experiences or developments Fam has encountered?
– Certainly. Fam recently attended the Fintech Innovation Lab – London, where I had the opportunity to discuss the company’s value proposition with industry leaders from UK tier-1 banks such as Barclays, Citibank and HSBC. The experience was invaluable and reaffirmed my commitment to driving positive change in the fintech industry. However, one challenge we are currently facing is the delay in becoming an official Shopify Payments partner. Shopify is a key platform for Fam, given its large market share of ecommerce merchants within our target categories. We are currently working on getting approval from Shopify which would allow us to roll out our Shopify Payments app to merchants so they can start accepting payments via Fam on their Shopify store.
– Impressive approach. With the growing reliance on digital payments, how do you see Fam shaping the future of e-commerce?
– I believe Fam has the potential to usher in a new era of zero-commission payments and rewards with better alignment of incentives. Not only by empowering merchants and consumers, but also by promoting a culture of responsible spending. As more and more businesses and individuals recognize the importance of financial literacy and awareness, we envision Fam playing a central role in shaping a future where merchants are able to improve their top and bottom lines, while offering more value to its customers and encouraging sustainable spending habits among young shoppers on a large scale.
– Exciting times lie ahead. Can you share any upcoming plans or developments Fam has in store?
– Certainly. We are constantly innovating and exploring new ways to improve our platform and expand our reach. In the near future, we plan to offer more integrations to leading e-commerce platforms and offer better targeting for more efficient customer acquisition for merchants who leverage open banking data and reach consumers through our consumer-facing mobile app. consumers. Additionally, we are committed to fostering partnerships with like-minded investors, fintech and e-commerce companies, continuing to support responsible spending habits and beneficial transactions between customers and the brands they love.