Finextra TV: Mbanq geared up to meet the increased demand for BaaS

“Partnerships are key in the Banking-as-a-Service market in the United States”, Mbanq CEO Vlad Lounegov stated for Finextra TV at the Temenos Community Forum 2022 in London.

Joined by Ross Mallace, EVP, Global Head of SaaS & Partner Ecosystem at Temenos, Vlad also explains the intricacies of Banking-as-a-Service in the USA and where Mbanq and Temenos fit in the whole BaaS value chain.

Watch the full Finextra TV video here:

Video transcript:

Sam Allen, Finextra TV
“Vlad, the big question: you are a Silicon Valley organization pioneering in this new world of BaaS. We’d like to hear more about Mbanq and what you’re trying to achieve?

Vlad Lounegov, Mbanq
“It’s not a secret that the United States market is the largest and most lucrative Financial Services market in the world. However, it’s also very highly regulated and very sophisticated. To be able to draw advantage from from the megatrends that we’re going to discuss today, one needs to be able to roll out a value proposition that allows banks to work with FinTechs.”

“One thing that we’ve seen for a long time is that the FinTechs and banks don’t really speak the same language. FinTechs want to deliver products and services which are akin to financial services, but they don’t have a license. United States market is one of those very strange and highly regulated, but yet sophisticated markets that allows that to happen through Banking-as-a-Service. Mbanq is the leading Banking-as-a-Service provider with a strong focus on the United States. I’m the CEO and Founder.”

Sam Allen, Finextra TV
It’s great to have you with us. We’ve been talking a lot today about partnerships and collaboration. Talk us through your motivation for choosing Temenos to partner with.”

Vlad Lounegov, Mbanq
“If we look at how Banking-as-a-Service generally works in the United
States – collaborations are key. And there are a lot of different types of collaborations which are necessary. Let me tell you a little bit about the whole Banking-as-a-Service value chain and you will see where Temenos and us fit.”

BaaS value chain

“It starts on the far end of the scale, with the regulator or multiple regulators. Regulation in the United States is so unique and so complicated that you don’t even know who regulates who at times.”

“It’s followed immediately by a bank or credit union, let’s say a licensed institution, and then immediately after that you have a technology provider and a service provider working hand in hand together to deliver a joint value proposition to the FinTech.”

“So the Fintech is the consumer of Banking-as-a-Service and they deliver the entire package to their end consumers. The central part for us is how do we as a service provider collaborate with a technology provider Temenos to deliver best service and to deliver the value to the FinTech.”

Sam Allen, Finextra TV
“From the Temenos point of view, you’re excited about this partnership – right, Ross?”

Ross Mallace, Temenos
“Oh absolutely. As we said, this is a real emerging trend and Vlad and the team at Mbanq have put together a really great proposition for the market. Of course, we at Temenos are delighted to be partnering with Mbanq in order to help them to get out there and ride this wave.”

Sam Allen, Finextra TV
“BaaS is undoubtedly one of our buzzwords from TCF 2022, a megatrend in the industry. How has Temenos geared up to meet this increased demand we’re seeing?”

Ross Mallace, Temenos
“I think there’s two parts to that. Yes, this is a megatrend. I think that Banking-as-a-Service opens up a whole new market for banks, for our customers, for FinTechs, because it really is all about expanding reach. Customers now want to use banking and financial services in their everyday lives on a more regular basis, rather than having to go to a bank or a branch to be able to do what they need. This just unlocks a large addressable market.”

“We really need to be able to scale and offer services that allow banks to scale, because we really do think that if you are successful in BaaS, you’re going to scale very quickly. That’s a very important topic that our prospects and customers are talking to us about.”

“The other thing as well is having our platform geared up and ready to work well with the business models that people like Vlad and Mbanq are putting together. That’s something we’ve actually been working on for a little while now and something we really understand. We’re really excited to be able to kind of have a very good and clear proposition that allows us to unlock that for our customers.”

Sam Allen, Finextra TV
“Thanks, Ross. Vlad, anything more to add to that?”

Vlad Lounegov, Mbanq
“In the United States market, technology is key. Now, why is it so critical in the United States market in particular? It’s critical because consumer choices have moved on. Consumers nowadays want Buy Now Pay Later, they want Crypto, they want Mobile Banking available 24&7, but the incumbent vendors and the current technology providers in the US market haven’t innovated fast enough to meet consumer demand.

This is where our partnership with Temenos comes in so handy. You need to have a stable, solid system like Temenos. You need to wrap it around an “As-a-service” portfolio that Mbanq offers – like for example Compliance-as-a-Service, Dispute-Resolution-as-a-Service, Cards-as-a-Service – to be able to make a compelling value proposition to the market and to the FinTech in particular.”

Sam Allen, Finextra TV
“So the future looks bright for this partnership, Vlad?”

Vlad Lounegov, Mbanq
“Correct. And partnerships are key.”

For more information on the Mbanq-Temenos partnership, head on to https://www.mbanq.com/temenos-partnership-cuaas/