FinTech Magazine March 2022

TECHNOLOGY The future of eCommerce is here, and it's thanks to fintech, from the rise of chat commerce and mobile payments to QR codes and data-focused solutions T he eCommerce revolution is in Furthermore, it gives buyers a sense of full swing, and there's no turning flexibility and control over their spending. back. Brick and mortar stores have been closing at an alarming rate \"Increased offerings of 'try before you over the past decade, while online sales buy' and 'buy now, pay later' will continue to continue to surge. pay dividends for eCommerce companies that invest in them,\" said Gregory Zakowicz, According to Statistica, worldwide Senior Ecommerce Expert at Omnisend. eCommerce purchases will reach US$5.4tr in \"These offerings give consumers increased 2022. So what is driving this significant shift? trust in doing business with brands.\" A big part of it is the rise of fintech, the fusion of financial services and technology. Mobile payments Another key trend in fintech eCommerce This feature article explores the is the rise of mobile payments. This trend fintech eCommerce revolution in detail, involves customers making payments using including some of the key technologies and their smartphones or other mobile devices. trends in play. One of the advantages of mobile FINTECH TRENDS payments is that they are convenient and IN ECOMMERCE fast. Customers can simply scan a QR code to make a payment without entering any BNPL details such as card numbers or addresses. One of the most recent fintech trends to hit the eCommerce space in recent years is For example, there has been a BNPL, or buy now pay later. This involves a tremendous increase in mobile payments merchant extending credit to a customer, usage in Brazil, accounting for 8% of all who then has a set time to repay the debt. e-commerce transactions based on research by JP Morgan. This fact is primarily due to the \"Now the eCommerce companies widespread adoption of smartphones and also give the option to pay in instalments. the growth of fintech in the country. This policy helps them to attract more customers,\" said Christian Velitchkov, “Ecommerce Co-Founder at Twiz LLC. \"This payment type is explodin” is usually preferred for large purchases.\" RICARDO PERO BNPL is also a good way of providing CEO OF SELLERSFUNDING financial inclusion to those who may not have access to traditional credit products. fintechmagazine.com 101

The platform economy is not just changing banking It’s fighting hunger, too. T he platform economy two years to make a positive is changing the globe, impact in communities is creating and connecting OneFarm Share. The platform communities in every industry. grew as a response to the Digital access allows new challenge faced by many markets to flourish, so that developing countries and users can share resources, amplified during Covid-19 interact and transact with more lockdowns: food security reach and impact than ever and hunger. OneFarm before. As a result, businesses Share (facilitated through and their customers are forging a partnership between meaningful relationships that HelloChoice and Standard support more than just the Bank Group) provides a digital bottom line. business-to-business platform Financial services institutions that allows emerging and are realising the opportunities commercial farmers to sell and this new economy offers. donate their produce to new Recently, Standard Bank Group markets. By December 2021, released the paper The Power 5 900 tonnes of produce had of the Platform Economy been distributed and nearly 24 for Financial Services, which million meals provided through highlighted the need for end-to- the platform. This year, the plan end solutions and the necessity is to distribute 10 000 tonnes of building strong partnerships of food and provide more than and ecosystems driven by data 50 million meals across South and insights. The Standard Bank Africa. IMAGE: GETTYIMAGES.COM Group is involved in developing Visit standardbank.com such partnerships with fintech to find out more. and BigTech companies such as Salesforce, Microsoft Azure and Amazon Web Services. OneFarm Share is a digital business-to-business One strategic partnership platform (facilitated through a partnership between HelloChoice and Standard Bank Group) that allows emerging that has evolved over the past and commercial farmers to sell or donate their produce to new markets. Since its launch it has provided more than 24 million meals to various communities. Watch our video here. Standard Bank is an authorised financial services and registered credit provider (NCRCP15). The Standard Bank of South Africa Limited (Reg. No. 1962/000738/06).

TECHNOLOGY “Advancements in Single-click checkout Fintech have allowed As most customers are familiar with the e-commerce companies process of making a purchase online, retailers to remove friction are looking for ways to make the checkout from checkout” process faster and simpler. One way of doing this is through single-click checkout, which KIRSTEN SHEPARD involves customers making a purchase by DIRECTOR OF ENTERPRISE SYSTEMS PRODUCT, clicking one button rather than filling out SAATVA multiple fields. Chat commerce According to Aman Ghataura, Head of Making payments in real-time while using Growth at Alphagreen Group, \"Start-up a chat interface is another trend in fintech fintech companies like Primer.io optimise eCommerce. This trend involves customers payment gateways to show customers the making payments using chatbots as a most suitable checkout providers.\" convenient way for customers to make payments, as they can do so without leaving In addition, single-click checkout can the chat interface. They also provide a help retailers increase conversion rates, more personalised experience, as chatbots making the purchase process faster and can remember customer preferences and simpler. As a result, customers are less likely behaviour. to abandon their shopping cart during the checkout process. Integration with existing messaging apps are another category of chat commerce, and these involve companies integrating their payment services into existing messaging apps such as WhatsApp, Facebook Messenger and WeChat. \"Businesses will add new mobile channels within their existing systems to reach more customers. More personal, targeted, and relevant communications and checkout experiences will enhance customer experience beyond standard messaging,\" said Pieter de Villiers, Co-Founder and CEO of Clickatell. \"Chat Commerce will enable buying, paying, and selling through more personal interactions between the consumer and merchant, including eventual automation and smart chatbot- powered interactions.\" fintechmagazine.com 103

TECHNOLOGY Data-driven innovations “Now the eCommerce Another trend in fintech eCommerce is companies also give the the use of data-driven technologies. This option to pay in instalments. trend involves retailers using data analytics This policy helps them to to understand their customers' purchase attract more customers” behaviour and preferences. CHRISTIAN VELITCHKOV Data-driven fintech helps retailers to CO-FOUNDER, personalise the shopping experience for TWIZ LLC their customers, which leads to a better customer experience. \"Price optimisation and management software allow internal teams to bring in data, adjust pricing strategy, and deliver dynamic price adjustments in real-time to eCommerce while maintaining consistency with traditional channels,\" noted Lee Rehwinkel, VP of Science and Analytics at Zilliant. Democratising access to sales Another development involves making it easier for small businesses and entrepreneurs to sell their products and services online. One way of doing this is through the use of marketplaces, which are platforms where small businesses can sell their products and services. \"Digital assets like mobile apps, eCommerce stores - especially Shopify and Amazon stores - blogs, Saas companies and other online businesses are the hot new alternative asset class for acquisition investors and digital entrepreneurs,\" stated Blake Hutchison, CEO of Flippa. Of course, there are also problems with the lack of some solutions. \"Ecommerce is exploding, yet the industry is still lacking sufficient financial solutions that serve small and midsize international merchants,\" added Ricardo Pero, CEO of SellersFunding. Other trends Some additional trends in fintech eCommerce include the use of cryptocurrencies and 104 March 2022

blockchain technology, as well as the “Businesses will add new increasing popularity of subscription-based mobile channels within their models. QR codes are also being used more existing systems to reach frequently as a way of making payments. more customers” In addition to consumer-facing trends, PIETER DE VILLIERS there are also a number of business-to- CO-FOUNDER AND CEO, business trends in fintech eCommerce. CLICKATELL \"Offering instant decisioning and credit to B2B customers can be achieved through an to help e-commerce merchants increase effective embedded payments experience sales and attract new, repeat customers who buy more, more often,\" stated Brandon Spear, CEO of TreviPay. Cybersecurity is also a major concern, \"as cybercriminals find ways to bypass login checks it is necessary to implement additional checkpoints that provide broader visibility and control over account activity,\" added Ido Safruti, Co-Founder and CTO of PerimeterX. Furthermore, this post does not address a number of additional intriguing trends; nevertheless, the ones above provide a good representation of some of the most significant developments in this area. WITHOUT FINTECH, THERE WOULD BE NO ECOMMERCE As the fintech eCommerce revolution evolves, one can expect to see even more innovative and exciting trends emerging in the coming years. \"Advancements in Fintech have allowed e-commerce companies to remove friction from checkout allowing the brand to sell their products to more people more quickly,\" said Kirsten Shepard, Director of Enterprise Systems Product at Saatva. In conclusion, it's an exciting time to be involved in the eCommerce industry, and without fintech, the industry would not have existed. fintechmagazine.com 105

106 March 2022

IBOTT Insuring the shared economy and beyond WRITTEN BY: JOANNA ENGLAND PRODUCED BY: JAKE MEGEARY fintechmagazine.com 107

IBOTT Head of ibott, Chris Moore, tells us why Insurers need to start paying more attention to the growing Sharing Economy I n January 2019, Apollo Syndicate Management, the independent specialist insurer and reinsurer, announced the appointment of Chris Moore as Head of ibott (Insuring businesses of tomorrow for today) and Deputy Active Underwriter of ibott’s special purpose arrangement (SPA) 1971 at Lloyd’s. Fast-forward to 2022, and Moore, who is known for his proactive leadership style and passion for innovation, is relishing the role that is leading ibott and its offerings from strength to strength. Moore, a mathematics graduate of Bath University who always wanted to work in the insurance industry, is not one to shy away from a challenge. He admits he took a somewhat unorthodox dive into his first role in the space. He explains, “I had visions of being an actuary and quickly realised that probably wasn't for me, so tried to transit into underwriting. However, I'd missed the graduate scheme intakes and so tried to find a different route into the industry which proved fairly challenging. Then my friend told me how he'd accepted a job at Deloitte to be a consultant and he was going to cancel an interview with an insurance broker the next day.” Moore saw his chance and took the slot for himself. \"I told him not to cancel it, and then turned up and stole his interview with my CV. I think they appreciated the audacity and gave me the job there and then.\" 108 March 2022

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IBOTT ibott: Insuring the shared economy and beyond “You feel like you are Adopting a new approach for new risks a small part of that The move proved to be another advantageous journey because you one for Moore, who thrived in the innovative have enabled them environment of Apollo. “It was almost like to achieve their goals a startup in itself, which is quite rare in the by making insurance Lloyd’s environment,” he says, outlining the an enabler and not a company’s background. blocker. It’s fun” \"It's called Apollo because the original CHRIS MOORE investor was Neil Armstrong, the first man on HEAD OF IBOTT the moon; the Syndicate number 1969 was chosen both to mark that event and to be The calculated risk paid off, and Moore symbolic of the challenge to the status quo began work as a broker, transitioned into that Apollo sought to pose”. underwriting at Catlin, and then two years into his career, grasped the opportunity to Moore says Apollo's attitude to innovation, join Apollo - a new Lloyd’s syndicate - to and the way the company embraces the help establish a new Casualty practice. client-first culture, resonated deeply with him. The company was one of the innovators 110 March 2022 behind building a first of its kind global solution for Airbnb in 2014. The biggest challenge with the product for Airbnb was the element of trust, explains Moore. \"To create trust in their marketplace, Apollo needed to ensure the nights stayed,

which were located in various people’s homes, IBOTT were insured well enough to generate trust in the product.\" CHRIS MOORE Central to the challenge lay the concept of TITLE: HEAD OF IBOTT ownership, says Moore, which the insurance INDUSTRY: INSURANCE industry, in general, is rooted in. It was the LOCATION: LONDON, UK disruptive ability of Apollo in acknowledging the changing marketplace and the potential Chris has been with Apollo since of the Sharing Economy that led to its 2013 and was instrumental in product innovations. the setup of ibott, the first dedicated division at Lloyd’s catering for the Moore says, \"The insurance industry is digital economy and new mobility. fascinated by ownership. You own a car, you insure your car. You own your house, Chris has a passion for insurance you insure your house. New millennials, innovation and believes in insurance however don't care about ownership. For products being an enabler for new them the future is utilisation, rendering it progressive business models. He challenging from an insurance perspective.\" was one of the pioneers in creating products for the Sharing Economy, By listening to the requirements of the working with companies such as marketplace and recognizing changing needs, Airbnb in early 2014 to create global, Apollo embraced partnership with Airbnb and first of their kind solutions. Chris has a created a tailored, fit for purpose, scalable degree in Mathematics and is FCII and product – and word spread. “When you create CRIS qualified. He sits on the Lloyd’s something for someone like Airbnb, your innovation panel and the Lloyd’s phone starts ringing; \"Hey, we're a rideshare Market Association Committee for US company. Can you create something for and International Casualty. us in the rideshare space?\" or, \"Can you create something in this car sharing space, EXECUTIVE BIO on demand delivery, drones, e-scooters, autonomous vehicles?\" because that's the direction society is moving towards.\" New market opportunities It was, Moore recalls, Apollo's client-first culture that led to the birth of ibott. “We moved away from a buyer-supplier model and embraced one of long-term strategic partnerships. We quickly gained a reputation for listening to clients, collaborating and co-creating new products, and innovating as much as we could.\" Taking advantage of new opportunities as they come along has been something of a habit for Apollo. “It just became very

Connected Insurance is helping digital platforms, reduce their risk exposure

Connected Insurance: should become contributors and enablers UBI and the Sharing to the businesses they serve. We provide Economy a solution that empowers our partners to make a better insurance offering to their Connected Insurance’s Tal Cohen client, as well as solution for the digital and Yaron Zurr reveal how CI is platforms to manage their self-insurance revolutionising UBI solutions in the and enable them to offer even more relevant sharing economy protections to their end clients.” Connected Insurance (CI) created a data- Technology-driven innovation and CI driven risk platform that powers the next generation UBIs, driving the space forward. CI’s full-stack solution connects and serves all parties: sharing economy Tal Cohen, co-founder and CEO of CI platforms, brokers, claim administrators, explains, “The sharing economy is a and reinsurers. Connecting everyone relatively new industry with limited under the same platform, says Cohen, exposure history. Traditional insurers are creates transparency, leads to better using traditional risk models that they use insurance pricing, and ultimately allows for similar products. This results in low sharing economy companies to reduce accuracy pricing, which is based on few risk their total exposure costs. factors and a black box that customers can’t understand or control. By differentiation, CI Cohen adds, “CI provides digital platforms breaks the insurance paradigm.” with essential tools such as: Risk & utilization dashboards to help the “Our technology employs pricing models platforms manage their insurance costs with much higher granularity, factoring many and control their risk; Connected Claims more data points currently ignored standard module integrated into the digital; tools to pricing models. We provide our clients manage the self-insurance part better than transparency on their insurance costs and most advanced carriers; and tools for rapid empower them to control and reduce costs creation of embedded insurance.” by making educated decisions,” he says. The result is a seamless delivery of Strategic partnerships services and a satisfactory customer journey, concludes Zurr, who adds, “CI can Extending their services into the marketplace optimise the customer’s insurance pricing has been achieved by a collaboration with by focusing on the lower risk usage and some of the world’s leading insurance avoid the riskier transactions.” players. Yaron Zurr, co-founder and CCO of CI, says “We believe that insurance players Learn more

apparent to us that the entire digitalisation- Fast-track to success and ibott’s launch driven space occupied by new tech, new Recognising that insurance companies were startup companies and new platforms was trying to sell mismatched products that just seeking insurance products that the insurance weren't fit for purpose was the revelation industry had previously failed to produce,\" that led to ibott being launched. Moore put Moore explains. together a team that is purely dedicated to those unique challenges within new tech He says that Apollo was fortunate in that it platforms and creating tailored insurance was exposed to the huge wave of insurtech products for them. early and was well positioned to embrace the opportunity and benefits of digitalisation Demand has been high, and since its from the start. “We were fortunate in the launch in 2019, ibott has been increasingly fact that we didn't have legacy systems busy. “It's been very successful,” Moore that would prevent us from adopting the says. “We’ve written an awful lot of digitalised partnership model. We partnered premium and forged some fantastic long- with some talented clients, broker partners, term partnerships and are on track to and tech vendors that allowed us to explore hopefully write US$250mn this year.” new things without huge upfront cost on our balance sheet.\" 2022 will also be ibott’s first year as a standalone syndicate. What that means is 114 March 2022

IBOTT that at Lloyds, the company will have its Today, ibott focuses on partnerships own capital base purely dedicated to this across the entire digital economy. “The team industry. This is important for ibott as the goes beyond just underwriting our clients market is changing rapidly and Moore and truly partners with them using APIs. This feels the need for dynamism, flexibility provides a deep level of understanding of and agility has never been so important our customers’ evolving needs. We can also in order to be a successful partner for use this data to establish new risk insights their clients. that we can feed back to our clients in order to help them make better risk based It's been a journey, acknowledges business decisions. Our goal is ultimately Moore, who says the past three years being to help our clients run safer and more dedicated to this space have enabled him sustainable operations.” and his team to meet with a wide range of companies that are passionate about Managing the Sharing Economy changing the world. \"You feel like you are With greater numbers of users than ever a small part of that journey because you before, from mobility solutions to the have enabled them to achieve their goals housing and travel market, the Sharing by making insurance an enabler and not a Economy has developed massively over the blocker. It’s fun.” fintechmagazine.com 115

2018 Year founded 18+ Specialised team count

IBOTT past few years. The emphasis on ownership has truly shifted to utilisation, which is where ibott is making its mark. “We were fortunate in the fact that we didn't have this wave of legacy systems that would prevent us from adopting the digitised partnership model” CHRIS MOORE HEAD OF IBOTT “When you start transitioning to a utilisation model you seen an immediate advancement in risk mitigation; we have seen marketplace platforms buying insurance on behalf of a lot of their users, whether it's their drivers, whether it's the hosts that put homes on their platform, whether it's the people that ride one of their e-scooters or e-bikes,” Moore says. “They're trying to build an insurance product that takes away the block of, \"Well, I can only use this service through insurance.\" And insurance historically has been a pretty awful customer experience which companies don't want to put their users through.” Ultimately, solving problems and creating seamless solutions is key as it encourages people to interact with the platform – and encourages others to do the same. This ease of use creates brand loyalty, he explains. \"If I were to put my home on an accommodation sharing platform, and I knew I had insurance in place that would protect me from anything that could happen, it would probably be a block in terms of me renting my home outside of fintechmagazine.com 117

IBOTT that platform. That's an example of how regulation piece that fits around that type insurance can tie in that customer loyalty. of policy. The real opportunity within this So when you start thinking about that, space is that you've now got a real closed the whole product itself has to change. pool of addressable premium.” Insurance in this space is not just about balance sheet protection. Strategically He explains, “If I wanted to insure a positioned insurance can be a USP for a fleet of drivers and I was trying to sell to marketplace platform.\" those individually it's a huge marketing spend, a huge amount of administration Creating a disruptive service and a difficult risk selection process. A Interaction with customers is critical to partnership with a platform, on the other the process. The plan must fit each user hand, permits 100% driver acquisition perfectly. “Am I speaking to the individual through a bundled commercial purchase, giggers or the individual drivers? Or am and unlocks the potential for my team and I speaking just to the platform?” Moore I to start doing a lot of things with the data says. “You've got a whole compliance and that can drive safer and thus improved performance.” 118 March 2022

IBOTT Managing Big Data for insights Scaling at pace With a large number of new data sources Another challenge is the ability to focus and and the growth of the IoT, processing Big grow. Because of how the insurtech industry Data has been a challenge for the insurance is developing, startups often make the industry in general. However, this rich mistake of trying to do too many things when information source has also been a huge they should always seek to specialise and advantage to insurtechs that have adopted become leaders in their fields. The Sharing the latest technologies and can manage Economy, like insurtech, is also undergoing the data to their advantage. a period of intense development. The digital ecosystem, Moore says, is \"It's expanding all the time,\" Moore says. providing insurtechs with the opportunity \"And it's not expanding linearly. Airbnb is a to create new products because they have great example. It transitioned quickly from better access to data and they are adept just providing homes to now providing at maximising that opportunity. “A lot of experiences and looking at the whole insurance companies have maybe struggled spectrum of travel. Policies have to be able embracing new risks like that of the Sharing to cater to that level of change. Insurers have Economy as they have a deep rooted struggled with that amount of flexibility and reliance on 10-15 years of developed loss that speed that you need to transition to data in order to price risk.” create a partnership that's fit for purpose for these companies.” “However, we need to move faster than that. It's got to be more dynamic. The 10 He continues: \"I think it's really easy to see years of data might only have three or four the opportunity and think disruption. But data points. What we can get through this my advice to startups in the space would digital ecosystem is hundreds of data points, be 'focus on your goal'. There is a huge from maybe the past two to three years. It's opportunity across every part of the value not as long-standing – but it is much richer chain, but focus on a certain deliverable information – and the world is moving and be good at it and deliver it and then so fast that it's almost certainly incredibly you can transition. And I think this is also a deep and it gives us so many different risk very people-oriented business. It’s about insights.” building relationships and partnerships.” “Embedded insurance is huge. There's still so much to be done on the insurance customer experience” CHRIS MOORE HEAD OF IBOTT fintechmagazine.com 119

IBOTT “D igitalisation done properly allows my team and I to derive new risk insights that we can feed back to our clients in order to help them make better risk-based business decisions. Our goal is ultimately to help our clients run safer and more sustainable operations” CHRIS MOORE HEAD OF IBOTT ESG, transparency, and mobility role to play, not just through providing But it’s not just about expansion, it’s also protection to these shared scooter about changes in direction. Consumers operators, but also educating regulators are becomingly increasingly focused on about what an insurance product needs the Environmental, Social and Governance to look like, and what the real risks are. We factors and so our clients are looking for are very data-driven in our underwriting ways to embrace changes and require decisions with ibott.” their insurance partners to support them in these endeavors. Moore says working with Innovation and success mobility firms is inspiring because they are Ultimately, Moore believes in innovation delivering on their carbon-neutral promises. – but it must be carried out strategically. He also believes the pandemic has \"I'm very passionate about micro- mobility. I do think it is going to play an important role in the future of transportation. What we're trying to be is transparent. E-scooters are an example where insurance poses a unique challenge. It's a new area of mobility and there isn't much data on it. There's certainly fear from certain regulators about embracing that aspect. But insurance has an important 120 March 2022

fundamentally changed the digital economy are so many opportunities in terms of the and the opportunity for insurtechs, and ecosystem and technology.” that embedded insurance will be the single biggest trending factor transforming the He adds, “that richness of opportunity has industry over the next few years. attracted a new wave of talent that insurance hasn't seen before. We are seeing people In terms of what inspires him today, he with a non-insurance background coming speaks of the richness of opportunity within into insurance – and it’s fantastic working the digital economy and insurtech industry with people that have a fresh, diverse way of as well as the latest emerging trends. doing things and a new perspective.” “Embedded insurance is huge. There's still so much to be done on customer experience. fintechmagazine.com 121 There's so much to be done on data. There

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