Bringing new energy into financial services: interview with Enel X
At the end of last year, we had a chat with Matteo Concas, Head of Global Digital Banking Solutions at Enel X – the man who’s taking one of the largest energy companies in Europe into financial services. He shared his views on how financial services are a part of an ‘electrified world’, the opportunities of open banking, and going the extra mile to bring value to customers.
Matteo Concas is Head of Global Digital Banking Solutions at Enel X.
We had a chat to find out more about why one of the largest energy companies in Europe is betting on financial services – and what opportunities they are looking to embrace.
Matteo also shared great insights and recommendations for aspiring open banking leaders.
Matteo has a vision and understands open banking – and he walks the walk. He oversees the development of Enel X Financial ecosystem, and the launch of services in the retail and corporate market. As a serial entrepreneur, he’s always been known for challenging the status quo. After working at N26 he founded Penta, a neobank for businesses, and is now at Enel X, where he's breaking the mould and doing things differently.
Here’s what he had to say.
Can you give a bit of background to Enel and Enel X?
In Italy, Enel is a household name. It’s not just the largest energy company in the country, but one of the largest in the world. And just like your banking sector, our energy sector is currently undergoing a lot of change.
For example, regulations are liberating the market, thus allowing new entrants to challenge incumbents. We're going through a digitalisation transformation, meaning that we need to become software-driven to create smart electrical grids and connect smart home appliances. And we have a responsibility to help reduce carbon emissions and guide the transition from fossil fuels towards renewable energy.
In the energy sector, you can only differentiate yourself by focusing on either price or customer services. And at Enel, the customer is at the heart of what we do.
As we see the society become digital and sustainable, we're literally seeing it ‘electrify’. That's where Enel X comes in. Enel X was founded to help society electrify across all verticals. Ultimately, we aim to enable smart living by adding financial services to provide an integrated series of Enel X services, all based on our knowledge of clients’ needs.
Why step into financial services?
Digitalisation and cashless societies, it's all part of an electrified world. We would never become a commercial bank that does everything – we would partner for that – but there are segments where Enel X can create valuable services.
We’re building an ecosystem enabled by cutting-edge financial technology for our customers and our business partners. We’re providing highly personalised financial management services with the ability to manage payments and expenses. And for the merchants, we have developed payment acquiring services with point-of-sale solutions where we can help them accept electronic payments at a much lower cost.
How will Enel X differentiate itself from other banks?
We may not be a traditional bank, but we are a household name. Our proposition is really targeted at families – helping the home situation.
One of the solutions we recently launched is called Enel X Pay. It includes a nice product for kids in the range of 11-17 years old: a card connected to a digital wallet, which can be managed through a PFM application used by the parents. Parents can use the app to see where the money is going, set budgets and manage allowances.
We learned early on that multi-banking and a couple of pie-charts don't really engage the user. PFM needs to be about education. Users engage when they get the insights they need to best manage their home finances. At a traditional bank, this would be an expensive wealth management advisory service. We're doing many of the same things, but making it available to everyone.
What's the underlying business case?
There are many parts to it. An important one is bundling services and increasing household share of wallet. The insights that we present to the user stand at the core of the monetisation engine. Our goal is to identify opportunities to help users pay bills, save money, help them make investments, manage insurances, and of course to optimise their energy bills.
We’re also looking at setting up partnerships where we could co-brand or white label our technology to enable business partners to launch a digital bank of their own. This could be a retailer, a transportation company, or another business that would benefit from getting closer to the customer.
As mentioned, we're creating an entire ecosystem. The Enel X Financial Services division is broad. We want to power and finance the small business segment. Enable them to accept and make payments, manage invoices, pay taxes, and much more. Our agents go to small businesses to sell energy and gas, and now they can upsell digital business opportunities.
What recommendations do you have for aspiring open banking leaders?
Today, every industry has an opportunity to move into fintech, and it has the potential to transform customer journeys. I would suggest executives should focus on three things:
One, take advantage of modularisation of the financial services infrastructure. Executives should look at the entire technology stack and vertical of services and carefully select which systems are needed to really transform the business.
Two, focus on your customers. You're not going to be disruptive if you only offer a credit or debit card. You need to understand what your customers expect from you. Usually, that means that you should pick a segment close to your core business and go for it.
Three, optimise for big data. We're still at the beginning of the open banking movement, and it’s already enabling unprecedented access to data that can transform operating and business models.
Enel X is exploiting open banking because we see it as a way to understand our customers – both consumers and businesses – and help them manage their financial situation. Over the next couple of years, open banking is just going to get better – and bigger.
This interview was originally featured in Tink’s survey report ‘Taking advantage of open banking’, published in December 2020.
If you’d like to find out more about how Enel X is tapping into our tech, read this post about Tink’s partnership with Enel X.
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