The power of partnerships: Interview with Petru Metzger, Head of Payments at Endava

By Gaia Lamperti

Following the launch of their report about the key trends that will be driving the Payments ecosystem over the next few years, IBS Intelligence met Endava, a London-based software development company offering its experience in digital transformation and consulting services to some of the world’s leading brands.

While commenting on the findings of the report, Petru Metzger, Head of Payments at Endava, also told us about the company’s value proposition, priorities in regulatory compliance, and renewed focus on innovation.

Endava is helping organisations to partner up to accelerate the delivery of their products and value proposition for customers, why would you say that partnering up is the smart choice for businesses right now? 

The main reason partnerships are so successful and a lot of organisations are looking at partnering with SaaS players right now is because they are very easy to integrate. You can pay as you go, so you don’t have to pay a lot upfront when you don’t know if and how you’ll be able to use those products. And if you grow, you’ll share a part of the profit or the benefits with the company selected as a partner. That’s exactly where the win-win situation happens. At Endava, we run a partnering program, signing specific deals with companies that we think are their best in class in different areas of payments or banking. This way, we learnt about their products and when we have to advise our clients, we know exactly the right solution that they need.  

These days competition is getting fierce in the SaaS sector from a Payments perspective, how is the space benefitting from it and how is Endava keeping up? 

Software-as-a-Service is one of the biggest trends currently in the market, and we see three types of software as a service from the Payments perspective. One is Issuing-as-a-Service, with leading players in that space, the second is Acquiring-as-a-Service, there are very few players competing in that space because requires lots of knowledge, experience and investments, and the third one is Banking-as-a-Service, where there are already a lot of players. We, as Endava, are more at an orchestration layer, we come on top of those product organisation partners that are needed to build the right end-product. For example, we are helping a Singaporean neobank to build a very fast solution based on a SaaS platform and we did a lot of the front-end part of the work, like the digital experience and the integration with lots of third-party providers for their cross-border payments, cards issuance, and all of their loyalty products.  

Endava recently published ‘Spotlighting trends’, a report on the future of Payments. What was the methodology used and what are some of the most impressive findings?  

We worked with more than 70 payment organisations in the world, all across different markets and, over the years, we have collected views in the US, Europe, Asia and the Middle East and so on. We have hands-on experience on what’s happening in the market and within those organisations and we can really anticipate what the most visible products in the market will be in the next 2-3 years. So, based on this understanding, we have organised a team with famous knowledge coming from our experience in doing projects for clients and we did a brainstorming session to see what were the common trends and which ones we see coming in in the market. Based on that, we selected the top 5 trends and how they will have an impact in the years to come.  

So, looking at, let’s say, a five-year window, what are some of the trends that we are going to see grow and that will affect the market the most? 

Longer-term trends are difficult to guess because we don’t know exactly when they’ll become mainstream. But one that we have been watching is central bank digital currencies (CBDCs). It’s not immediately visible, but about 90% of banks are evaluating how to transition to digital currencies and what will be the impact on their consumers, especially those not using digital. Now, that will take time, probably even more than 5 years, but there are already more than 4 countries that adopted it (China being the leading one) and we have already seen that there is a task force to implement digital currency even in the UK. So, lots of good things are happening already and it’s clear that we will inevitably go in that direction. A closer look at things that will happen faster would be on the trend of ‘Buy Now, Pay Later’. We are participating in a lot of those solutions, both by building them from scratch and by integrating existing big players like Klarna. It’s very clear that it’s a big trend that will continue in the next year or two, but there is also a big regulatory pressure coming which will slow it down a little bit.  

Talking about regulatory compliance, how is Endava ensuring that it’s a priority for all of its clients?  

Regulation is one of the most difficult parts to be solved in banking and Payments and we have team members that specifically advise clients on how to go in the right direction and benefit from investing in regulatory compliance. According to the current view we have, banks and big players are spending 90% of their budget on regulation and very little on innovation. That’s why the narrow banks are more successful: they don’t have a legacy, so they use very simple models without really getting deep into very heavily regulated models and don’t have to keep up with a lot of compliance. So, we advise the new players in the banking sector to start in a way that will be simple and to create better models only after they mature.  

Is that a way to push towards investing in innovation?  

Well, in Endava we also have an innovation unit that is actually investing in understanding how new technologies can help payments to adopt new models. We are investing upfront into innovating and creating proof of concept to show our clients how things can be done. For example, we are playing with quantum computing and how it could help to solve difficult problems in payments, we also tried payments in VR and AR and showed business cases around that. Innovation for us is very important, it’s a different way of doing things and we are investing massively into it.