Global Fintech Interview with Ryan Frere, EVP of Payments at Flywire

As AI develops and powers more functions in fintech and finance, it will change how the industry shapes up. While that happens, how will the mainstream evolution of technology impact fintech on the whole? Catch this interview where Ryan Frere, EVP of Payments at Flywire shares his thoughts.

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Can you tell us a little about yourself Ryan? Tell us a little about how you’ve built and scaled a global payments team over the years?

I’m sort of a payments geek really. I love solving complex problems related to how money moves around and how that delivers impact for organizations and their customers.

I’ve spent over 15 years in payments and technology; the last six plus with Flywire.  In that time, we’ve grown the company from 35 people to roughly 500. When I joined Flywire, I was a payments team of one and now we have almost 30 people globally. As I’ve built the team, I’ve focused on some key attributes that we value at Flywire.

• Execution – the desire to drive to impact through our payment initiatives; for example, finding ways to make international education payments easier, making healthcare payments more affordable through flexible payment plans, or getting PPE from China to hospitals in Boston more quickly by using our global payment network.
• Ambitious innovation – a constant push for solving complex problems in ways that they haven’t been solved before.
• Global collaboration – pretty self-explanatory in running a global payments team, but we need people who are able to understand their local markets well and apply it to a global payments strategy. It’s critical to be able to work collaboratively across the many teams needed to achieve our objectives. The global payments team, more than any other group in the company, has to work with every other department in the business.
• Cultural adds – Most importantly, we look for people (Flymates we call them) who add to our culture and bring new ways of thinking and problem-solving to the team. Of course, we also like to have fun along the way so it’s important that new Flymates like that as well.

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How have you seen the fintech / finance segment (especially innovations in payment solutions) evolve over the years?

I would point to several big themes.

Combining global and local. As the world becomes more connected it is becoming both simpler and more complex. It’s easier than ever to access goods and services – no matter where you are in the world. At the same time, delivering that experience in a seamless manner is more complicated for organizations. To win on the global stage, organizations need to deliver a local experience. This requires unifying fragmented systems, navigating a fast-moving regulatory landscape, and delivering on unique customer needs.

The mainstream evolution of technology.  It used to be that only tech companies did tech. Now small companies can build software, scale it globally using the cloud, and make it available via self-service. And many big companies – regardless of industry – consider themselves tech companies first. As a result, proprietary systems are both proliferating and fragmenting with a lack of interoperability. This can paralyze companies. How do they know what to choose and how will it work with everything else?” Making the wrong choice has big implications. This is especially true in payments—the lifeblood of any business. Organizations can’t afford to be too far behind or in front.

Combining technology with human touch. Almost every business is undergoing digital transformation. It’s a journey with multiple connected intermediary goals striving towards continuous optimization across processes, divisions and the organization’s wider ecosystem. But fewer than one third of digital transformation efforts succeed. That’s because it requires more than technology alone. People don’t want ‘digital’ for everything. Face-to-face interactions have increased in value as they become scarcer. Organizations need to find harmony between people and technology. Not to be trite, but the combination needs to equal more than the parts.

Digital expectations. Instant, digital-native, always available, low-cost solutions are table stakes for most businesses and their customers these days. While services become more transparent and easier to access at lower price points than ever before, many organizations still struggle to offer their customers a reasonable payment experience – the ability to pay when they want, how they want and with whichever method they choose. Unless payments are brought in-line with digital-native services, organizations will face customer experience, retention and acquisition challenges. Conversely, handled the right way, payments can unlock valuable insights that can help organizations deliver better services. Payments need to be repositioned from cost center to competitive advantage.

In payments, one size fits no one. Organizations require payment experiences customized to their vertical industry, their business and their customers. Unfortunately, most payment services are off-the-shelf when they should be tailored to fit. Rather than working with existing systems, processes and people, ‘one size fits all’ payments work against them. As a result, organizations are losing time, money and customers.

‘Billers’ don’t want to own the payment process. As the requirements get more demanding, they will look for solutions that can shield them from the complexity and risk of payments so they can focus on their core business.

How according to you will the demand for personal fintech apps/financial payment enablers change with time, and given the current world situation (due to the pandemic)?

The coronavirus crisis has created an urgency around digitization unlike anything we have ever seen before. Whereas digital was a significant competitive advantage for forward-looking businesses, today it’s become a basic matter of survival. We’re seeing organizations move more quickly than ever before to automate more of their front and back-end processes like payments and receivables – to facilitate remote work requirements, meet changing customer needs, and gain new operational efficiencies. None of these things are necessarily new, but they are far more urgent than they have been for a far greater number of companies.

What are your thoughts on how new innovations in fintech and payment solutions will evolve with the influence of AI?

At the moment, the hype outshines the reality, but AI absolutely plays a very valuable role in fintech and payments. It’s not a panacea though. The applications are unique to the use cases that each market is trying to solve. Banks are anticipating their customers’ needs based on past experience with other customers, deploying chatbots to support service inquiries, and using intelligent automation to provide faster and more targeted financial scoring.

As AI matures, and more use cases are proven out, it has the potential to improve many aspects of the payments business. It’s already being used very effectively to automate more of the receivables process, streamline payment reconciliation requirements, and reduce the potential for fraud.  AI also plays a role in enabling Flywire to predict and manage foreign exchange rates – reducing costs for our clients and their customers.  Additionally, in our healthcare vertical, AI helps determine which patients might have difficulty paying their treatment bills. This allows us to proactively engage patients earlier in the process, and (also using AI) offer that patient a payment plan, based on his or her ability to pay. As a result, fewer receivables go to collection, the provider gets paid in a more timely fashion, and the stress is reduced for patients.

We’re also looking for opportunities to extend it to our worldwide multi-lingual customer support operations with AI to give our customer support team more insights into the needs of both our clients and their customers.

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When it comes to fintech needs – payment apps, contactless payments will now grow in demand; what are your thoughts in terms of how this segment will now evolve as a result of the world crisis/the effects of Covid-19.

I would point to the acceleration of those trends discussed – increased digitization all things payments, managing globally but acting locally, increased transaction transparency, more verticalization of payment experiences, and finding the right mix of technology and human touch.

When it comes to streamlining and optimizing the payments delivery and the accounts receivables process: what are some of the top features that business users should look for when they identify/shortlist fintech platforms?

• A convenient and secure digital experience for payers that promotes adoption of the digital channel. They are getting this in most aspects of their life – and they expect the same regardless of what type of payment they are making.
• Complete transparency into their transactions – for both the customer (payer) and the receiver (biller). The paying customer wants to know what they are being charged and why – regardless of whether it’s a domestic or international payment. They want to know when they initiate a payment for a certain amount that that same amount is received on the other end. And they want confirmation when it is received. This is especially true for higher-value payments that typically take longer to process.
• On the biller side, they need the same level of transparency — into when a payment is initiated, received and reconciled. They also want/need to automate the reconciliation of those payments as much as possible to control operational costs and cash flow. As I mentioned earlier, AI can assist here by separating transactions that require manual intervention from the majority that don’t. The technology can also help with least-cost routing to speed payment flow and minimize fees for both billers and their customers.
• I think you’ll also see a demand for more flexible payment options for customers. This is especially true where large sum transactions are in play; e.g. education and healthcare. Tools that can match payer financial profiles with flexible payments plans. This can ease the burden for customers while ensuring higher percentage of collections for the biller and reducing the cost of collections.
• The ability to handle cross-border and domestics payments through the same platform. The more global our economy becomes, the more billers have to be able to treat all payments the same. This impacts both their operational efficiency as well as the experience they offer their customers.
• Choice – Customers want to be able to pay via the option and currency that best meets their needs. As payment continues to become more of an integral part of the customer experience, it’s essential businesses pay attention to this.

How do you think the payment-as-a-service niche will evolve with time to meet the needs of both B2B users and individual business owners over the years?

We only have to look at the overall Software-as-a-Service model to see what will happen in payments.  Payments-as-a-Service makes more complete capabilities readily available to businesses of all sizes. There are no big software installations and companies pay for the value they receive, or in some cases, the service is paid for by transaction or convenience fees – at no cost to the business.

The key is the combination of technology, payments, compliance and customer support – that allows businesses to properly serve their customers. Companies will no longer have to create their own payments teams.

Consider a travel business organizing adventure trips to exotic locations. They have to worry about getting paid by their customer and then distributing some portion of those funds to the multiple suppliers on the ground that will deliver the actual experience for them – rooms, food, transportation, excursions, etc. In many cases that will be in another country and require a different currency. The travel company has to factor in exchange rates, currency fluctuation, local regulations and more.  Every industry has its own complications. Payment-as-a-service is essentially getting rid of all that complexity and friction.

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Tag (mention/write about) the one person in the fintech industry whose answers to these questions you would love to read!

Matt Harris, from Bain Capital Ventures. He is a member of our board and someone I seek out all the time. He has incredibly valuable insights on what’s happening in payments and fintech.

Your favorite FinanceTech quote

I could pick a lot of things from Matt Harris at Bain.  The one that comes to mind right now is less inspirational and more practical. And it really speaks to how we approach out business at Flywire. We hear a lot of noise about disruption in the fintech space, and new startups competing with the big incumbents and banks, but in Matt’s words: “It is impossible to build a financial services product without having an incumbent as part of the mix. You cannot be a payments company without having a bank partner.”

At Flywire, we feel like we are disrupting the payment experience, not necessarily the payment business. That’s an important distinction and one that I think has enabled Flywire to have a lot more impact.