Open Banking Expo’s Ellie Duncan caught up with Tom Beckenham, founder and CEO of Comma, to find out what the fintech is doing to solve SMEs’ bulk payment problems and to hear more about its partnership with Yapily.
1. Comma is a relatively new business to market, so can you tell us what’s behind the launch and your aspirations for the business?
I started Comma because, prior, I was running financial operations at another business and I became aware that corporates had access to certain sorts of systems, such as corporate banking and all sorts of other billing systems which small businesses had no access to at all. The scale of the problem for small businesses, especially very small businesses, is enormous. Close to £1 trillion a year is transferred and most of this is done manually by literally copying and pasting from things like payslips into online banking accounts.
It’s a tedious process for a small business that I’ve experienced, many people have experienced and it’s something I really wanted to get rid of. That was the driver for me in starting the business and our company mission; to remove the pain in payments.
For me, it’s about doing something for other businesses that will help them and the whole Comma team is focused in that manner. It’s always been about the customer, solving problems for them and doing it using new technology. I think Open Banking has opened up so much, it has enabled us to solve this problem in a way that’s never been tried before. It’s actually enabled us to offer something that businesses have always believed they should have been able to do with their bank accounts, but it just hasn’t been possible. Now they’ve seen what we’ve been able to do, it’s like, ‘yeah, that’s how it should have worked all along’.
2. How is Comma doing things differently to support SMEs on their own growth journey?
In terms of how many businesses approach payment problems, there’s been this assumption that if you’re small then you just have to wait until you’re a little bit bigger before you get access to any sort of tool that’s going to help you out. The reason for that is actually the hurdles that solve a payment problem are often bigger than the problem itself, in some regards. So to set up initial accounts or to set up corporate banking, for example, it’s overkill in terms of trying to solve payment problems for very small businesses.
So that’s been the biggest challenge to solve. What sort of technology can you introduce that you can use within seconds and can use instantaneously? The approach that we took to building Comma has always been about that instant gratification. You can set yourself up instantly, you can use your existing account instantly and that has really been the key to unlocking this whole market.
3. What has been the response so far from SMEs?
It is early days. We’ve been partnering through accounting firms and their clients, and that’s been going really well. From a client perspective, they kind of think it’s magic when they first see it and it’s like [they ask] ‘does this actually exist?’.
There are new parts of Open Banking coming out all the time and, together, the industry has to campaign for Open Banking in general, so that the customer understands that it’s real, that it’s secure, it works and it’s reliable. That is something that as an industry, we all face.
4. You work closely with Yapily. Can you explain this partnership and what it means for the industry?
We approached Yapily at the end of 2020. The reason we went with Yapily was they were exposing the cutting edge – the newest parts of Open Banking that other providers were not yet exposing. As a company, we knew that bulk payments were going to form a very big part of what we were doing and it was brand new, no-one had really tested it. We essentially worked together, with Yapily and the banks as well – bank by bank – to uncover exactly what fields and requirements each one had.
There are two aspects to the whole project: there was the API connection itself, which was complex and is what Yapily was working on. Together, we figured out that part of it because much of it was undocumented, or the documentation the banks provided was not matching exactly what the reality was when you caught the API, so it’s been a hard task. In terms of what that can now offer the industry, bulk payments are real and they’re possible.
The other side of the API is all the stuff we had to figure out, which was how to make a clean experience for the user and to work with the logic that the bank applied. Imagine you had a list of 20 payments you had to make, and they can be to anybody and they could be any size. Each bank had different requirements around what they accepted in a bulk payment and that was really difficult to figure out. You couldn’t just push these 20 payments to a bank and expect it to work. A lot of that was a user interface design exercise, we had to figure out the least possible clicks that the customer would have to make to push payment through. It goes back to what I was saying earlier about the hurdle to solve the problem has to be less than the problem itself.
Yapily has been a great partner, very supportive and it’s given us a very good conduit to the banks as well.
5. What do you make of the UK’s Open Banking journey to date?
The UK is way ahead, I think the only other market so far that has introduced bulk payments is Germany. Even in terms of the rest of Open Banking, the adoption of Open Banking was very widespread very early.
I think there’s been these little leaps that have brought it into the mainstream. Now, with what we’re doing with Comma, we’ll be getting Open Banking into the hands of many small businesses. It’s exciting because we think it can become a mainstream way to pay and it could become the primary way to pay in a few years.
6. Open Banking payments adoption is set to rise in the months ahead – how might this be a game-changer for the industry?
I think that the biggest thing about Open Banking payments which is interesting is that you can now connect a payment to data. So you can now get information into your bank, which is something that traditionally has been only able to be done by keying in manually if you were small, or if you’re slightly bigger, inputted via files and some of those files are quite complicated formats. It’s an absolutely huge leap and it means that you can start to automate processes in a much better way.
There is still a way to go. The API reliability has become much better in single payments and with bulk payments it needs to get to where it is in single payments. The advancements that are happening are huge. I think the advancement with HMRC and being able to pay taxes within the HMRC portal is a really good example of how you connect data into payment. Previously, keying in some of the reference numbers HMRC gave you was a big area for error and the fact that can now be done without having to key it in has been an improvement.