Wednesday, October 21, 2020

Interviews with practitioners: How to transform SME banking with Jason Oakley

 Interviews with practitioners: How to transform SME banking with Jason Oakley

Watch the second episode of DueDil Live Series to find out what Jason Oakley, Founder an CEO of Recognise Financial Services thinks the future of banking looks like.

During the second episode of DueDil Live Series, Denis Dorval, COO of DueDil, welcomed Jonathan Oakley, Founder and CEO of Recognise Financial Services to the discussion table.

In episode two of our DueDil live Series, COO Denis Dorval hosted Jason Oakley, Founder & CEO at Recognise Financial Services. Like many of DueDil’s partners, Jason has selected our holistic KYB-For-Life platform to enable him to accelerate engagement with SMEs and to help his team build relationships with partners as they prepare for launch.

As with our previous DueDil Live episode, this interview is an opportunity to showcase a real practitioner of transformation and innovation in the SME financial services market. We feel lucky to be able to share Jason’s insights and vision of how FinTech such as DueDil can be a mechanism of change and growth as the world continues to deal with unpredictable and unprecedented times.

So, Jason, could you please tell us a bit about yourself and how you became the CEO of a new UK bank launching in 2020.

I’ve been in the industry for 35 years. I was very fortunate to start my career in sales roles, then to move into marketing and operations, and I’ve also been an IT director. I’ve led major franchises for the last 20 years. Working for RBS and NatWest. I was head of SME for both before moving into M&A and then to Metro bank as the MD of commercial mortgages. So I’ve had a very broad spectrum of experiences but it does not compare with how excited I am about this.

In our first interview we also found our practitioner to have quite a diverse background. Your experience must have put you into a good position to transform. It seems that you have the sort of cross-functional background that you need to ensure people listen to you.

I agree. To my mind, it’s about people, communication and inspiration. It's about creating conditions so that people can be the best they can be. Whether you’re looking after IT or operations, financial services is all about people.

You’ve been a successful operator in commercial and SME banking for many years across the Tier 1 banks. So why launch a new bank?

It’s always been an ambition of mine because, while I think banks should have a passion for what they are trying to do. And what I observed at other banks was SMEs being forced into call centres. Having a lack of continuity and accessibility. SMEs make up 52% of GDP and are 99% of all employers. They employ 60% of people. If we want to address the productivity gap and re-establish ourselves in terms of economic growth as we come out of this pandemic, we’ve got to support those SMEs.

It’s clear how important the human factor is to customer experience and it’s clear you want to address those issues, but how do you go about creating a new bank from scratch?

The segment of the market that I feel is most poorly served is the £100,000 to £5 million market. We see a real gap in servicing and relationship support in this area. And Covid-19 made that a lot worse. In terms of building a bank, it’s an incredibly daunting process. Getting the team in place with the skills and capabilities was so important. But once you’ve got that right, we saw an opportunity with cloud-native for IT, which was able to disrupt costs in terms of implementation and distribution.

What was your vision and the mandate you gave to your team when building the technology stack to support your mission?

SMEs are about high value, low volume transactions so heavy fix costs from a billing perspective is really unpalatable. The technology we use is incredibly powerful and I was really pleased to see the innovation that DueDil is achieving with its partners. But I’m a purist from an architectural perspective. I love the API, open banking, and the flexibility and future-proofing, but some of our providers don't have that technology so we still have to have a data warehouse and have to do the mapping. I’m delighted DueDil is very much part of that forward-looking movement. We’ve had to compromise a little, but the core engine is scalable and future proof.

Technology is here to simplify things and engagement should also be simple to give the human touch as you mentioned. You believe in cloud-native and API integration first, and this is what we see in the movement towards building best in class technology. It delivers value by providing the capability to innovate faster.

Exactly. But also it’s very disruptive from an economic perspective. Costs for disruption are significantly lower than they would be. The key is the customer. What does the customer experience feel like? How can we be easy to work with? How do we honour the fact that they create significant value in our economy and they deserve a better service? Hence the name Recognise. We need to recognise their critical role and the importance of technology in allowing us to enhance and enrich relationships.

When are you going to launch?

We got our completeness at the end of September and the only other requirement is proof of capital. We have now completed a £27 million raise so we are starting as soon as we get the green light from the PRA/FCA. We hope that will be in the next two or three weeks.

And what do you expect from technology partners? How will they serve you?

It’s about mutual understanding and adding value. When I look at DueDil, I don't just see you as a vendor, I see you as a partner and I look at you and say right how are you going to help me improve the SME client experience. Let’s work together to make it better.

That's what we’re hearing. This market is evolving fast but what you need to identify is the right partner. Digital has changed one main thing - speed. If you don't have the capabilities to enhance your service you’re in trouble.

And also what speed and technology does is educate and make things more transparent. So things will start to change, people will start to expect more. So I want to disrupt and encourage SMEs to say ‘I’m an SME and this is not a relationship service’. My mission is to work with people like you to give them a lot better.

Fast forward, what is your vision for the next two to three years?

It constantly evolves. We’re a licensed bank but we have a deposit restriction, which is for proof of concept, so once that’s lifted we will proactively seek out the opportunity to work with debt and relationship hungry, growing businesses. And Covid-19 is one of the drivers. A lot of good business models are now struggling, but family-owned businesses tend to strengthen their balance sheets and retain profits so some of these businesses see the pandemic as creating opportunities, and we want to help them continue to grow and build value.

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