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Sopra Banking Software is reaching new heights

In his role as both chief client officer and EVP specialised finance, Sopra Banking Software’s Eric Bierry oversees all business activities related to Sopra Financing, the company’s best-of-breed platform of leasing and lending solutions including formerly Cassiopae and Apak. It was no surprise then to see his delight when the IBSI Sales League Table was released with Sopra Financing announced as the global leader in the Lending Systems category

Talking about the company’s business model and focus areas, Bierry says: “Sopra Banking’s strength is that it is a software business dedicated to the banking industry. We are not doing investment banking or corporates; we are fully dedicated to retail banking and specialised financing.” In a market where super-specialisation is the dominant strategy, Sopra Banking Software seems to have got this right.

Established in 2012 as a division of the publicly listed Sopra Steria Group, Sopra Banking Software has grown rapidly through a series of acquisitions. Talking about the advantage of having a large group with over 50 years of combined experience in the IT services industry, Bierry says: “We are the young brother of a big industrial company in the IT industry. So we have a very close partner who can provide business competency and infrastructure management capabilities to support and enable our solution within a complete end-to-end approach for key financial institutions.” Being part of a large group with a strong balance sheet also provides Sopra Banking the flexibility and the funding to scale up its digital strategies as well as its cloud strategies through investments. But has this been the only success factor for Sopra Banking, which has fuelled its growth over the years? Eric highlights two key USPs that enable the software company to stand out among its competition.

“The first USP is our long-term relationships with some big European banks,” he says. “These relationships demonstrate our proven track record in the market. We have formed business partnerships with these banks, underscoring our philosophy to be a valuable contributor to their business success. This perspective sets Sopra Banking Software apart from vendors who aren’t in the position to be able to take such a longterm view of client relationships.”

The second USP for financing specifically is market-leading feature function. Sopra Banking Software’s “single platform offers best-of breed components that add value for all types of financing businesses and products”, says Bierry. He highlights these robust, specialised and localised financing solutions as the critical factor when dealing with big banks and financial institutions that expect solutions that can be deployed for many types of financial products in multiple countries and currencies.

“We have to be able to deal with big players in the banking sector on strategic projects for which we have to deploy across several markets with their needed localisation but without diverging from a single platform that will bring all the returns and gains for that corporate,” he says. “Combining best-of-breed components on a single platform and backing that with the most credible global footprint in the industry is an important USP for Sopra Banking Software.”

On the topic of USPs and Sopra Banking Software’s strength in the market, Bierry also highlights that Sopra Steria is still a family business with long-term oriented shareholders. This orientation ensures that the company aligns with its long-term commitments to clients.

“We want to be stronger where we are already strong and where we do see opportunities to emerge and accelerate globally.”

Sopra Banking Software’s ideal clients are large enterprises that are looking to significantly transform their business by adopting a core platform that can deliver an important lift in an initial, master project in one or two sites, and then be rolled out across countries and business lines. He highlights Mercedes Benz Bank as an example where the bank started with implementing Sopra Banking Software’s auto finance solution in two countries and is now rolling out this solution across 16- 17 countries, including the US and Canada.

This global expansion thanks to its large accounts has led Sopra Banking Software to accelerate its presence in further markets than its inital market focus of western Europe and MEA. As Bierry points out:

“Our large clients who start with a project in Europe usually end up expanding into the US, China, Australia and sometimes Brazil.” So, for Sopra Banking Software, it becomes logical to expand operations into these markets. According to Bierry: “In the last three-to-four years, we have been accelerating in the Americas, including the US and also in the APAC region. We have an office today in Brazil, three offices in the US, two offices in India and one each in China, Australia and Singapore. In fact, one-third of our new sales in the last 18 months came from these regions outside of Western Europe.” He added that the offices in these regions are not just representative offices with only a handful of people. Some regional centres have as many as 100 employees.

There are two types of teams housed in each of these offices – one is the R&D team that works on localising the software to fit the market requirements, and the other is a local professional services team that will be working with the local bank’s IT team. Bierry expects at least 80% of the company’s new investments will be dedicated to expanding in the US and APAC markets, as he believes that an essential part of Sopra Banking Software’s growth is linked to expanding in these regions.

A three-pronged approach

Talking about the strategies employed to succeed in the new focus markets, Bierry shares Sopra Banking Software’s three-pronged approach which involves piggybacking on the expansion by its big clients, M&A and partnering with local banks.

When Sopra Banking Software’s clients expand to new markets, the successful rollout of the company’s solutions for those clients in new markets, such as China, is key. Demonstrated project success starts market momentum as it is noticed by other potential clients in the country. A leadership position in the IBSI Sales League Table further highlights the company’s market-leading solutions.

Using the recent Sword Apak acquisition as an example, Bierry explains Sopra Banking Software’s M&A strategy of not only building a comprehensive set of solutions for the clients but also leveraging the acquired company’s market presence. Specific to Sword Apak, he says: “The Apak acquisition adds a market-leading wholesale finance solution to Sopra Banking Software’s financing portfolio and accelerates our expansion of the US market. It also brings additional SaaS deployment expertise to our global intellectual property.”

Launching new businesses in partnership with banks is another approach that Eric highlights as an important strategy to penetrate new markets. He talks about Sopra Banking Software’s recent partnership with German-based Sparda Banks as a key example. Sopra Banking Software has formed a joint business with Sparda, first to modernise the bank’s own systems, and then to sell that system and related services to other banks. This sort of approach helps accelerate business in markets where Sopra Banking Software does not have a strong presence.

While summarising, Bierry is quick to highlight that all these strategies to accelerate the business are linked to one principle – delivery. If delivery is not executed well, then none of the strategies will work.

Sopra Banking Software stands out as a software juggernaut with its clearly laid growth plans for the next few years. But what about competition from new fintech startups and emerging technologies that are disrupting the banking industry? To this, Bierry says: “The fintech startups of today are primarily focused on serving the end client and not the banks. Also, they lack the integration capabilities and are not used to dealing with big clients, which is why many Sopra Banking Software current partners are able to deal with large banking clients.”

That being said, Sopra Banking Software has been taking initiatives to stay ahead of the game. Its solutions are now cloud-ready and it continues to accelerate its go-to-cloud strategy through a digitalnative approach and further evolution of its front-office applications including customer and dealer portals. Today, all of Sopra Banking Software’s solutions have a large library of ready APIs to tackle PSD2 and integration with emerging technologies such as AI-based applications.

To sum it all up, the next five years are going to be exciting for Sopra Banking Software. Bierry is clear on their strategic priorities for the next five years: “We will continue to specialise in retail banking and lending. We want to be stronger where we are already strong and where we do see opportunities to emerge and accelerate globally.” The US is a top priority where he plans to multiply by four-to-five times the current revenue in niche areas such as specialised finance. He also sees Sopra Banking Software becoming a strategic partner to its big banking clients, operating a similar model as the Sparda Banking model. It is this clarity in strategy and commitment to delivering as per the client’s expectations that has been instrumental in Sopra Banking Software’s market success, which as Eric Bierry highlights is what is also reflected in the IBSI Sales League Table for its Sopra Financing Solution.

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