Fintechs must work harder than ever to deliver a truly differentiated product, says Brite Payments founder Lena Hackelöer 👇
Lena Hackelöer was first introduced to fintech in 2010 when she joined buy now pay later company Klarna.
She saw a gap in this expanding market for a business that would provide an instant payments offering for merchants and consumers and created Brite to fill this need in 2019.
Brite Payments is an instant payments provider, with headquarters in Stockholm and a growing presence across Europe.
It currently operates across 21 markets in Europe and is connected to more than 3,800 banks within the EU.
Fintech Intel spoke with Hackelöer to discuss Brite, being part of the growing fintech scene and the future of payments.
What does Brite Payments offer customers and merchants?
Brite Payments is an instant payments provider, with headquarters in Stockholm and a growing presence across Europe. We leverage open banking technology to process account-to-account (A2A) payments in real-time between consumers and online merchants.
We currently operate across 21 markets in Europe and are connected to more than 3,800 banks within the EU. However, with strong demand for more convenient payment methods, this figure continues to grow.
At Brite, we initiate the payment from the consumer to the merchant, but also take full receipt of the funds for instant processing. To do this, we utilise our own banking network across Europe, which we use to funnel the funds and to increase speed and cost efficiency.
For merchants, the instant processing takes away the credit and fraud risk and increases consumer convenience because funds are typically settled within seconds.
Moreover, we also offer instant payouts; this was driven by merchant demand across services such as insurance, consumer loans, refunds, savings, investments, gig economy wages and more.
For customers using our services, no signup or credit card details are needed, as they can authenticate themselves using top-of-mind details via their bank’s usual identification method. A quick, secure and convenient experience.
Why did you start Brite and how is it different to what was already on the market?
I joined Klarna back in 2010, which was my first introduction to fintech, and since then there has been a huge level of growth in the industry and the space has evolved drastically.
Throughout the last twelve years I have been closely assessing the industry’s developments and what brands have offered to suit new customer demands – be that B2B or B2C.
I felt that despite the rapid development of the industry in many areas, there was still a gap. There was still the need for a business that would provide a strong, large-scale instant payments offering with an attractive brand positioning for both merchants and consumers.
We created Brite to address this gap and to introduce an instant payments business to the market that would be highly recognisable and engaging for both merchants and consumers – a unique offering within the market.
Brite is always visible as a payment brand, meaning consumers make an active choice to pay or get paid with Brite, in contrast to other players in the open banking space.
Moreover, our concentrated efforts to improve and enhance the consumer experience mean that we are uniquely placed, and this approach has helped drive our current period of hypergrowth.
How has fintech changed, from the early days at Klarna up until now?
The fintech industry has certainly evolved drastically since I started at Klarna back in 2010. There are three overarching transformative trends that I’d highlight.
First is infrastructure. First generation fintechs entered the market when the foundations were not yet established – they were riding the rails while laying them. This meant in-house teams creating custom- built solutions, often using technologies in new and innovative ways. Although costly, this offered a significant competitive advantage because there were so many opportunities to build products superior to the competition.
I observed this phenomenon during my time at Klarna, where products launched across the industry were truly differentiated in terms of their technological approach and there were real advantages to be gained.
By comparison, today there is a flourishing ecosystem to support second generation fintechs, with many modular out-of-the-box solutions that have supplanted some of the in-house innovation. While on the one hand this standardised infrastructure has significantly levelled the playing field, it also means that competition is fiercer than ever. Now, fintechs must work harder to deliver a truly differentiated product.
Second, the approach to talent has changed markedly. In 2010, we were in an environment where particular skill sets were not yet available – there wasn’t an industry that existed to develop them.
Today, fintechs can build teams with talented individuals who have honed their skills in a similar role previously, drawing upon in-depth experience. In a similar vein, the fintechs that were growing rapidly in the early 2010s were carving out a new path and did not have comparable business models from which to learn.
By comparison, companies can now assess the business models of a decade ago in minute detail, which helps make more informed strategic decisions.
Finally, over the last decade we have seen significant change to regulation, which has presented both challenges and opportunities for established and emerging fintech businesses.
The introduction of new, and often more robust, regulation in fintech has increased the compliance burden and created the need for significant resources to follow changing requirements across markets.
However, it has also unlocked a host of opportunities for innovation across sectors, for example the impact of open banking regulation on APIs, which has been transformative for merchants and consumers.
What role will Brite and similar fintechs play in the future of payments?
We will continue to leverage technology in order to simplify the payment experience for consumers, which we believe is still more cumbersome than it should be across Europe.
For merchants, payments are still very local and the only red threads across Europe currently are either card payments or a select few payment giants, for example, PayPal.
Therefore, our role will be to provide a pan-European alternative to process these payments safely and efficiently.
What’s on the horizon for Brite?
We are really proud to share that we hit multiple milestones last year and are currently in a period of hypergrowth, having experienced significant demand across Europe for our payment products.
We will continue to establish local operations across Europe and evolve our products for individual merchant and consumer needs.
We are also planning for further expansion to bring our products to even more geographies and currencies, creating sorely needed connection and convenience.
Image: Brite Payments