apidays LIVE London 2021 - Reaching Maximum Potential in Banking & Insurance with API Mindset October 27 & 28, 2021 From Open Banking, to Embedded Finance and Insurance From Open Banking to Embedded Finance Simon Torrance, Founder & CEO at Embedded Finance & Super App Strategies

1. Embedded Finance
The $7.2 Trillion market opportunity
API Days London, 27 Oct 2021
Simon Torrance
CEO, Embedded Finance & Super App Strategies
www.embedded-finance.io

2. Introduction
Board and Leadership Advisor
• New Growth Strategy
• Platform & Ecosystem Strategy
• Venture Building
www.embedded-finance.io

3. Problem #1 – our financial system is not fit for purpose
Source: Mercer for World Economic Forum 2018
Source: Simon Torrance, based on FICO Bank Study 2020
E.g. Retirement savings gap ($ Trillions) E.g. FIs don’t address full needs

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5. Problem #2 – Business models are under pressure
Source: McKinsey Global Institute, July 2020; Simon Torrance analysis
• Low interest rates
• Increased competition
• High admin costs
• Obsolete technology
• Non-digital leadership
“Scared
sh**less”

6. 5
Problem #3 – New Customers with new behaviours
Sources: AppAnnie; FT; NGA

7. Digitising existing business (most focus today)
Intelligent Solutions
Developer Enablement
Online Marketplaces
Ecosystem Orchestration
Impact
Complexity
1
2
3
4
5
Digital Business Model Archetypes
Source: Simon Torrance for the World Economic Forum 2020

8. What is Embedded Finance?
Abstracting financial services functionality
into technology to enable any product or
service provider, retailer or developer to
seamlessly integrate innovative financial
services into their customer propositions
and experiences:
• Visible complementary add-ons, or
• Invisible native components
Timely, personalised and relevant to context
Payments, Lending,
insurance
Payments, Credit,
Insurance
Payments, Lending &
Insurance
Lending & Insurance
Examples
Payments, Lending &
Insurance
Source: Simon Torrance
10x better customer experiences,
faster/cheaper/simpler/fairer, leveraging
new data sources (Open Banking/Open
Data/Sensors), financial inclusion

9. Very tangible commercial benefits…
+ Insurance
100m new customers
Source: Simon Torrance analysis, industry interviews
B2B Software
Businesses
Digital Service Providers
& Platforms
+ Credit + Insurance
+20% to order value
+50% conversion
Retailers &
Manufacturers
+ Payments + Loans + Insurance
5x SaaS TAM/ARPU

10. Alipay: what can we learn?
90 insurance partners and 2000 products (life and non-life), including pension micro insurances
Roles

11. Started with payments…
*Market value
Embedded
Payments
Embedded
Lending
Embedded
Insurance
$7.2 Trillion*
Global 2030
Other
Source: Simon Torrance analysis

12. FinTech = the world’s new innovation platform
*Market value
Embedded
Payments
Embedded
Lending
Embedded
Insurance
Top 30 Global
Software
Companies
Top 30 Global
Financial
Institutions
$3.6 Trillion*
$5.1 Trillion*
$7.2 Trillion*
Today Today 2030
Licenses & Deposits
Internet + Cloud +
Mobile Tech
+ Financial
Technology
Other
Source: Simon Torrance analysis; Bain Capital Ventures; Morningstar data

13. Existing Customer base
(Product-centric)
Agents,
Brokers
Fintechs/BigTechs
Developer Platforms & Neo Aggregators
Direct Partners
New Customers
(More personalised, affordable and compelling solutions
integrated into daily life)
Your Products
Your Underwriting
APIs
Your Capabilities
APIs
Compliance & Capital Compliance & Alt Capital
Traditional New
Any Products
Any Underwriters
Any Capabilities
Digital Wallets
Any Company
Copyright: Simon Torrance 2021

14. 1. Brand’s App
now enables
payments with a
Digital Wallet!
2. Connect your
bank account(s)
and cards
3. Spend as
normal, anywhere,
using any method
4. Get instant
rewards -in cash-
courtesy of Brand
5. See savings build
up in your wallet
(spend anywhere)
Benefits for brand’s marketing ops
2000+ back-dated transactions per cust
Ongoing real-time insights:
• Total spending behaviour
• Avg order sizes, by age, locality
• Brand performance vs competitors
Reduce Visa/MC costs
Reduce plastic, save planet
Leader in digital innovation
6. Access other
financial and digital
services, tailored to
your needs
Super Apps for Super Brands – the best hook is free cash!
Can be used for
shopping
anywhere!
Open Banking is
safe and secure,
reduces friction
and enables new
experiences
Source: Simon Torrance, Upside Savings

15. Embedded Finance/Open Banking: hook and glue for SuperApps
Source: Simon Torrance, Upside Savings
Benefits
1. Real-time insights: real consumer spend
2. More ‘VVIP’ customers: 80% profits from
20% customers
3. Less churn: intervene early
4. Better loyalty CX: automatic rewards
5. New customers: very targeted offers
6. Low cost/fast: no/low IT implementation
Higher CLTV + Lower CAC
= Better Business model
Your new
Super App

16. Ambidextrous Org structure = foundational success factor
New Innovation Governance
Optimise
the Core
Fast track
the Future
• Internal Ventures
• Fintech Collaboration
• External Ventures
• API-ise
• Data-fy
• Automate
Where to play/
How to win?

17. Embedded Finance
The $7.2 Trillion market opportunity
API Days London, 27 Oct 2021
Thank you
simon.Torrance@embedded-finance.io

18. New York
JULY
Australia
SEPTEMBER
Singapore
APRIL
Helsinki & North
MARCH
Paris
DECEMBER
London
OCTOBER
Jakarta
FEBRUARY
Hong Kong
AUGUST
JUNE
India
MAY
Check out our API Conferences here
50+ events since 2012, 14 countries, 2,000+ speakers, 50,000+ attendees,
300k+ online community
Want to talk at one of our conferences?
Apply to speak here