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Mambu

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Our Advisory team explains how cloud-native infrastructure, composable platforms, configurable products, and low upfront investments are paramount to unlocking value and scale faster, cheaper, and with a better customer experience.

Scalability has proven to be a key success factor for banks in the fintech era. Businesses can scale through expansion within existing revenue pools (more users - ‘scaling up’) and by tapping into new markets (geography/products - ‘scaling out’). Banks that scale up or out tend to have a competitive advantage and hence better returns, with our research* showing that banks achieve an average improvement of 11% in their profit margins as they scale to new geographies.

However, the key to unlocking value is to scale faster, cheaper, and through better customer experience. Enabling this type of scalability requires a different approach on how organisations leverage technology: cloud-native infrastructure, composable platforms, configurable products, and low upfront investments.

It’s by following these principles that Mambu enables neobanks, fintechs, incumbents, and non-traditional players to transform financial services and become more scalable. In fact, when we look at Mambu's customers, we learnt they are 32% more likely to scale across geographies** than comparable peers.

Four technology design principles to enable scalability

Cloud-native infrastructure

  • No local hardware requirements enable deployment of solutions in weeks (vs. months)
  • Processing power and storage are optimised to each location’s needs
  • Technological reliability and recovery is managed by Cloud vendors – minimising in-house requirements to ensure business continuity standards (E.g. overhead, redundant servers, etc.)

API-first, composable technology platform

  • Participate and orchestrate local ecosystems through APIs
  • Tailor, complement and create more sophisticated value propositions integrating third party solutions through composable architecture
  • Provide a local flavour to global solutions when required (regulatory, customer preferences, etc.)

Customisable solutions through configuration

  • Thousands of product configurations enable an efficient product customisation to different micro markets with a single code base
  • As maintenance and updates of SaaS solutions are handled by vendors, resources are focused on innovation - operative processes are automatised and outsourced

SaaS technology partners with low upfront investment requirements

  • SaaS models enable a more risk-adjusted use of resources, reserving investments to scale when there is market validation (rather than for initial set-up)

Some examples of how Mambu's customers are reaping the benefits of scalability

This inherent scalability which is enabled by our technological platform has allowed our customers to generate significantly faster, more efficient time-to-revenue and better customer experience, launching new products, expanding to new geographies, or serving new customer segments:

  • New products: Banco Itaú leveraged Mambu’s composable platform to deploy its digital wallet “Ank” MVP and test market opportunity in only 13 days. Mambu customers typically experience a 60-80% reduction in time to market and can launch MVPs in weeks and full digital banks in under six months.
  • New geographies: Ferratum used Mambu to enter seven new markets in just three months, and another 10 in one year. Single code base and ability to quickly add processing capacity using a public cloud, were the key enablers of this fast expansion.
  • New customer segments: Uala, a successful payments and lending solution for the unbanked and mass Gen X and Millennials in Argentina, was able to develop and launch new value propositions to minors and micro merchants – Uala Biz- in less than six months with an API-first approach
  • Better Customer Experience: ABN Amro launched New10 for the SME segment, achieving 60+ NPS scores - well above industry average within the segment. In fact, Mambu enables its customers outperform peers by +18% and +10% in their end-customer engagement and experience respectively (Source: Mambu analysis).

* Methodology: A sample of 125 big banks (having a market cap> $10Bn), from all over the world, are divided into cohorts based on the number of countries they are present in. Average profit margin is calculated for every cohort. Source: Mambu Research, S&P global.

*The improvement tapers post expanding to three-four geographies.

** Mambu’s EMEA customers had an internationalisation rate (expanding beyond their HQ) of 23.2%. This internationalisation rate was then compared to 57 similar-sized public banks in EMEA, who had an average internationalisation rate of 17.5%. Source: S&P Global, Mambu Research.

**Compared EMEA only as the region offers a certain level of market integration which helps ignore the impact of extraneous factors (like laws, protectionist policies etc). This enables focussing and comparing solely the technical scalability of the core banking platforms

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Prateek Gupta and Ricardo Ribelles
Prateek Gupta is an Associate with the Mambu Advisory Services in the London Office, and Ricardo Ribelles is a Principal with Mambu Advisory Services based in the Amsterdam office.
Prateek Gupta and Ricardo Ribelles