Johan Gabriëls, Country Manager Ebury Romania, in an interview with Business Review, described Ebury’s unique selling proposition and gave his view about the future of Fintech companies in Romania.
“At Ebury, one of Europe’s fastest-growing fintech companies, we provide FX liquidity, volatility risk management and international payments. We focus only on SME’s and large local corporates, not retail”, said Johan.
Having relevant experience in banking as well as in leading fintech companies in Romania, Johan Gabriëls has acquired an excellent understanding about both the traditional financial sector as well as its challengers.
“In the early days of fintech, traditional banks didn’t worry much when some of their clients move to ‘the newcomers’. Now that the fintech market becomes more mature, I am confident that Ebury and our fintech colleagues make it to the agenda of the Executive Meetings of the banks.”
According to Johan, some banks are taking actions but they struggle with the internal culture and their legacy systems.
“I used to work for Capital One, today one of the top retail banks in the US, but early 2000 one of over 50 monoline credit card companies, said Johan. ‘I believe the future of fintech companies will be very much the same as what happened to these ‘monoline’ credit card companies. Some will be very successful and become a mainstream brand, some fintechs will be bought by traditional banks while others will disappear’.
“What is clear however is that every bank will need to adapt to the new fintech reality or will be at risk to disappear. Fintech is here to stay.”, said Johan.
Describe Ebury’s activity and why Ebury will be successful
Incorporated in London almost 10 years ago with 23 offices globally, Ebury now provides tailored currency and funding services to over 37,000 businesses worldwide, helping them to manage currency risk and strategically plan their approach to international payments to accelerate their international growth.
“Despite being a fintech, we believe our main differentiator is customer service. After all it takes longer to build a customer relationship than to build an IT system. That’s why in every country we are present; Ebury recruits and trains the best people”, said Johan.
“The first thing we do is to understand our potential client. Yes, we first listen, because every client is different, importers or exporters have different needs, the profit margins are different and company’s understanding of risk management products is not the same.”
“In general, we start by building trust, showing our clients we can make internal payments faster, save and probably cheaper versus the traditional banks. In a second phase we will propose and discuss a foreign currency strategy”, said Johan.
At Ebury we offer our clients a state-of-the-art online platform but also a dedicated account manager who can help with every aspect of transactions. We are also part of the Bloomberg top currency forecasters and will keep our clients informed about the FX market at any time.
We take a long-term approach to develop solid, mutually rewarding relationships. Having a client portfolio of over 37.000 companies globally means we are doing something valuable.
“The success of Ebury will be driven by its focus on customer service, global presence and continued innovation where technology will play an enabling role”, said Johan.
In terms of relation with banks, can we talk about a symbiosis?
Sometimes banks are our competitors, sometimes they are partners. Ebury works together with top tier banks on a global level. They provide us FX liquidity and payment solutions. We traded over 17 BN€ in foreign exchange over the last 12 months, so we became also an important client for these banks.
In the local market we recommend our clients to keep the relationships with their bank. What we ask is that they put Ebury next to their bank as a real competitor when it comes to international payments and FX management.
This competition will ultimately benefit the clients. This is also the reason why some regulators continue to push Fintech innovation.
Tell me about Ebury Romania and the market you are addressing?
We opened a branch in Bucharest one year ago. What started last year in May with a small team of 5 is today a team of 20 professionals with plans to extend the team even further during 2019. Ebury Romania ended its first year of activity on the local market with a client portfolio in excess of 250 companies, currently adding 50 new corporate and SME clients every month.
Ebury estimates that from the 12.300 companies in Romania having a turnover above 1M€ and having a substantial amount of international payments, about 13% are already working with a Fintech company while another 30% are considering adding a real competitor to their current banking relationships over the next year.
“Romania has exceeded all our expectations with respect to number of clients ready to explore alternatives to traditional banking services. We have passed the level of early adopters and are now moving to the early majority”, said Johan Gabriëls, Country Manager Romania.
“The experience of this last year has shown us that companies in Romania are increasingly aware of the impact of currency fluctuations on their company’s results.
Our goal is to increase the level of education in the management of foreign exchange risk and, at the same time, to support these companies with personalized strategies to protect against currency volatility”, said Johan.
According to Ebury’s statistics, less than 15% of Romanian importers and exporters have a hedging plan, compared with >60% in Western European countries. Hedging is a method of covering currency exchange risk by buying or selling a currency so that if a sudden currency fluctuation occurs, the company’s revenue will not be affected.
In a global daily FX market of almost 5 Trillion $ of which less than 5% relates to real economy (buying and selling goods and services) and were foreign exchange rates are influenced by the political, economic and financial fortunes of the markets, the question should not be if but how I can protect my business against these currency volatility.
Having worked in major corporates like Mars and PepsiCo, protecting against budget rates and having a FX policy was a must for every CFO.
The growth opportunities in world markets are promising also for Romanian companies. However, the global competition for these opportunities is strong, and a company that wishes to operate on an international scale must increase its competitiveness in every way it can. One way of giving your company a competitive edge is to improve its management of FX risk.