Interview: Balázs Vinnai, Keeper of the money gate


From BBJ’s print edition: You may not be aware of it, but if you ever bank online, there is a good chance you’re using a software solution provided by IND Group, a leading Hungarian firm that is quickly expanding throughout the world. Balázs Vinnai, IND founder/EY’s Entrepreneur of the Year for 2013, spoke to the Budapest Business Journal about the future of the industry and how technology will better cater to customers’ needs.

BBJ: IND Group specializes in providing banking IT solutions. What does that mean in practice, what is it exactly that you do that bank customers can experience?
Vinnai: If you ever bank online, there is a good chance you have encountered our product, which is essentially a complete software solution for the entire digital banking process. We don’t consider ourselves a technology supplier, but a comprehensive service provider, since we don’t only integrate our net bank solutions into the operation of our client banks, but we are also keeping a close watch on trends of customer habits and how digital customer service work in other areas of commerce.

Q: Does the company draw income from licensing or through additional services?
For the time being, our revenue mainly comes from licensing fees and expanding our range of clients as well as the maintenance that goes along with that. Even though I’m convinced that there should be closer cooperation between banks and providers like us, financial firms are still fairly reluctant to take these business relationships further, for instance by creating a profit-sharing arrangement in return for the development of new and better services. I used to say: ‘Our commitment, cooperation will not be finished when we close the implementation process and hand it over to the client; that will be the point when the real journey begins instead!’

Q: What kind of competition do you face?
I like to say that for us, the biggest competition is the internal IT department of any major bank, these big, bulky organizations that typically like to retain control of all aspects of IT provision, even areas that they aren’t proficient in. We have to convince them that what we provide is far more extensive than a technological service, which we can implement far more efficiently than the internal IT people. We seriously invest into innovation – this is the key element of our international success. And innovation is the area where banks quite often struggle if they want to manage within their own organization.

Q: What are the main observations that you see in general customer use of banking services?
The main aspect is to make the banking experience more service-oriented, to better account for customer demand. People don’t want to do banking. People want to live their lives, enjoy it, managing their goals and achieving their dreams. Banks shouldn’t approach this business from their perspective: today, the customer’s experience is based on the terminology banks use for products and actions (what customer understands these?), banks’ processes and rules, etc. The most successful companies nowadays are those that build up their entire structure, processes, products and organization purely from the customer’s perspective.

This is another point: your average online bank management screen already offers a multitude of options, but if you think about it, you’re only using a fraction of them. Banks already have all the information about their clients. Based on somebody’s past bank account activity, we can predict their spending at an accuracy of more than 80%.

Thirdly, there is a boom in mobile technologies that completely changes our world, redefines entire industries and how people are managing their lives. I believe this is the future of our industry too: Via smart devices, banks can provide an excellent experience to their customers. But these require completely new functions and new services: a new concept for mobile phones/banking. What the banks now need is to provide services and counseling that takes these individual habits and needs into account.

Q: If mobile is the future, are you confident that wireless technologies can provide the same degree of security that wired devices or desktops can?
I’d reverse the aspect of that question. Consider the fact that there are still banks that accept transfer commissions via fax, or think about how much easier it is to forge a signature on a piece of paper in a branch office than getting through all the security features digital banking offers. As far as I’m concerned, the electronic banking solutions we already have are by far the safest available among all other options.

Q: Besides the internal IT departments, what is the competitive environment like, how many other vendors like you are on the market?
There is very intense competition and there are quite a few very good companies on the market. Fortunately, most of them are about our size, meaning the playing field is level and there isn’t one or two multi-billion dollar corporations dominating the segment that we would somehow have to overcome. IND Group is a leading player in this game.

Q: How was 2013 for you and what are your plans for 2014?
We are aiming to keep the current dynamic and continue growth, as we did in 2013. We are looking at revenues of HUF 5-6 billion in 2013, which compares to HUF 3.5 bln the year before. We are constantly looking at new opportunities and new markets.

Q: Does this mean the expansion of your clientele or expanding on the agreements that you already have going on?
Right now, our main focus is the introduction of new clients. We currently have the opportunity to set up our business with new companies and new parts of the world, which is something we definitely want to take advantage of. Thanks to the nature of the business, we could easily provide our services on a global scale without the need for personal presence.

Vinnai was born and educated in Miskolc, where he got a law degree. He founded Interactive Net Design in 1997 with college friends. Vinnai himself has received several commendations throughout his career from the profession as well as the state, most recently being named EY’s Entrepreneur of the Year in 2013.

IND develops software solutions that are integrated into core banking systems, such as online banking or various finance management platforms. IND operates offices in nine cities, servicing 40 clients in 18 countries, and is rapidly boosting its annual revenues as it enters new markets. During its 15 years of existence, IND has received numerous awards and recognitions.

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