27.09.2022 Finance Farvest Decrypt International Tech

What if spend management was key to get up to speed?

Writer Laura Campan

This week, we had the opportunity to talk with Soldo Head of Payments Technology Steve Whiting about spend management and the growing interest from the financial industry.

1. Like all new concepts, it may be challenging to get a grip on what Fintech means. How would you explain it in simple terms?

Well, to answer this question we need to go back in time.

Banking has never really cared much about the end-to-end consumer experience. It was all about the money and the safety – understandably. So online and mobile banking apps were not appealing to people – unlike Social Media for instance, especially designed to get people glued to their phones.

But in the last ten years, we have seen a paradigm shift: the regulated world of finance met the world of internet technologies and eventually got into the lean-agile mindset of Social Media, giving birth to smart cloud solutions always available, very easy to use and scalable – better known as FinTech.

2. The pandemic forced many businesses to rethink and accelerate their digitization strategies. Would you say that the FinTech sector is one of the most notable examples?

If evolution has taught us anything – especially since the onset of the pandemic or the war in Ukraine – it has been the importance of being agile to easily adapt your business model and remain competitive in today’s constantly evolving world – and the FinTech sector is undoubtedly a leading example.

A company with big overheads and which is still a long way from profitability will potentially have a harder time to get some investment and take it to the next level – unlike a FinTech, where the survival of the fittest has happened already, by investing in cloud accounting or smart payments.

3. According to a study conducted by Coleman Parkes Research – on 950 senior finance decision makers of SMEs from a broad range of sectors – weak spending controls are costing European businesses around 347 billion euros a year. Would you say that digitizing spend management is key to unlocking more cash? 

Perhaps surprisingly, in most of the SMEs, finance leaders still have to use cash and spreadsheets, or even read out card details over the phone to enable employees to make urgent purchases.

When they start using spend management software and related services like Soldo, businesses realize they have a more holistic view of working capital, providing a better handle on spend management, optimizing costs, and overall efficiency – especially in times of recession.

4. The main consequence of poor spending controls is primarily financial but we can easily imagine there are a range of other impacts, could you further explain it?

In the last few years, we have seen the hipsterization of society. Work was no longer only about putting food on the table but about passion. Most of the start-ups then started to implement FinTech so they could put their energy on other things instead of managing booking systems or payments.

Poor spending controls may indeed act as a drag on your business. Let’s take a competitor pretty similar in terms of energy than you as an example. If it has a technology freeing up even 10% of its time from administrative tasks, it uses that extra energy to focus on their core business, their true passion, inevitably making it more competitive than you.

As the saying goes, “time is money” – and empowerment here.

5. Although it offers a wide range of benefits, digitizing spending management is not all about convenience though. According to you, which are the main challenges ahead? 

Like any new sector – especially considering that spend management will attract growing interest in the coming years, with new players coming into the market – the true challenge will be to get up to speed and stay in the race.

Even though banks certainly are clever, they were not born in the cloud but with a pen and paper, so it won’t be easy to change… They will have to scale and retain the scrappy start-up culture of constantly pushing themselves to get up to speed – which in and of itself is a universal challenge, right?