Rabobank Embedded Services and Banking as a Service
The Banking-as-a-Service (BaaS) area within Rabobank, provides the platform for Rabo Embedded Services. Comprised of multiple teams, we enable Rabobank to distribute products and services to third party partners and corporates via APIs. By using APIs, we allow our partners to embed our financial services within their online platforms ranging from payment solutions to lending and digital identity. We currently have 26 APIs live on our Developer Portal.
We help support the expansion of their businesses which enables us to extend our reach to their end customers as well so that we can ‘be where the customer is’. Growing the distribution of financial products through third parties is one of our key strategic priorities.
In the historical view of Rabobank’s strategy, “to be where the customer is”, meant that we were physically present for our customers in retail stores and local branch offices. Now more than ever, customers are leveraging digital platforms and fintech applications such as a budget app or bookkeeping software. Customers expect frictionless journeys and therefore, they expect modern financial services embedded into the platforms of their choice.
The start of Banking as a Service and the Rabo Embedded Services initiative
In 2019, the PSD2 regulation required Dutch banks to share customer data with payment service providers given that the customer approved his consent. Data that is our source of leverage and sustained competitive advantage can now be used to enable other third-party payment service providers.
Besides offering PSD2 APIs to remain compliant, BaaS strategy fosters competition by enabling product and data distribution channels via commercially driven API’s.
The implications of PSD3 for our platform
The forthcoming arrival of PSD3 means that there will be new regulatory challenges for Rabo Embedded Services and our banking as a service strategy.
In June 2023, the European Commission published a press release about modernising payment services and proposals for PSD3. Although, the impact of these proposals has yet to be assessed and passed by the EU. PSD3 may broaden the scope of regulatory requirements from ‘Open Banking’ towards ‘Open Finance’ to benefit the average consume or citizen as well as move towards common API standards for payment and account information services. The implications for Rabobank can include increased compliancy costs and competition with our premium APIs. Nevertheless, these potential changes reinforce our current strategy – improve our API platform and developer portal experience.
Embedded persuasive technology for improved developer experience
The regulatory and market forces of open banking stress the balance between digitization of financial services and social responsibility. How can we incorporate these themes into our way of working?
Third party partners (mostly developers) gain access to our APIs via the Rabobank developer portal. They need to learn whether our APIs fit their business case, understand the technical requirements, and learn how to implement these APIs correctly for their applications. Within my squad, the developer experience is our main focus and priority.
As you can imagine, we want to make developer learning and tasks as simple and streamlined as possible. Hence, the mental modes of developers are extremely important to consider while designing features and systems. By understanding how developers work and think will enable us to design a better developer portal and improve developer experience.
An example of this is the application of persuasive technology strategies. The term ‘persuasive technologies’ are defined as a class of technologies that influence a person’s attitude or behavior via systems design. This discipline was popularized by B.J. Fogg in the early 2000’s and is the foundation of design theory for social media platforms like FB, Instagram, Uber, and more. There are many frameworks and theoretical constructs that comprise this sub-discipline of human computer interaction (e.g. Hook Model, Nudging theory, choice support strategy, etc.).
Existing research and case studies of incumbent platforms assist us to design our IT systems and services in a way that combines technological utility and interaction with personalized developer profiling. We want to leverage developers’ knowledge, reduce their cognitive load during tasks, and contribute to their goals whether that is learning about a new API or increasing time to market for their applications. The application of these strategies can help us to empower developers. We want to provide them the capabilities and tools to confidently use our services leading to a sense of accomplishment in their personal and professional ambitions.
In projects like these, I enjoy using my research skills and scientific mindset which I can attribute to my former health professions studies and tech management degree. Normally, I like to use multiple scientific methods when I’m researching a problem or question such as customer profile archetypes or case studies for a business idea. It allows me to formulate business requirements from a unique perspective but that it’s also grounded and validated in research.
What else do we do?
Rabo Embedded Services aims to be where our clients are, stay relevant, stay competitive and generate business models.
The B2B tribe and BaaS Area offers more than just a platform for embedded financing. We also provide services in:
- Product consultancy
- Product portfolio management
- Partner & proposition management
- Pricing, billing, sales, agreement and support
- API lifecycle management
Open banking is considered the future of banking, and we believe our platform is preparing Rabobank for adopting that model. We will keep growing distribution of financial products through 3rd parties and integrated services in the upcoming years. We also aim to create the best end-to-end developer experience and offer a stable and secure platform to serve millions of end users.
Curious to know about our portfolio?
Have you ever given permission to a company you ordered from to directly debit money from your bank account? What about ordering and paying via Whatsapp? Well, we help companies using our product suite to facilitate those payments for every day customers.
On the other hand, entrepreneurs and business clients e.g. Bizcuit, Eleanor, Asperion, integrate our invoice financing products to serve their end users ranging from accountants to entrepreneurs and freelancers. Rabobank enables these clients to embed our financing services so that their end-users can pre-finance or request payments for their invoices. Odido (previously T-Mobile) leverages our Rabo Identity Services solution like iDIN to identify new and existing customers. Clients can also bundle and integrate multiple APIs into their platform. Check out Rabo Embedded Services to read more about specific use cases and trends.
Interesting booktip:Persuasive Technology – a volume in interactive technologies
