An amazing journey- From a local software house, to an international FinTech disruptor
It all began in the summer of 2008. The negative effects following the collapse of Lehman Brothers started resonating across the globe, leaving no business unaffected; especially those in the financial sector. At the same time, on this side of the Atlantic, local regulators were busy implementing the first European Payment Services Directive. Banks and other businesses in the finance industry, were trying to figure out how this new framework, combined with modern technology, could substantially change the landscape.
The timing for Viva Wallet was perfect. A medium-sized software house, founded in 2000, highly specialized in the development of large-scale transactional applications for Banks, was about to embark on an amazing journey.
How did Viva Wallet grasp this situation as an opportunity for innovation and growth and what were the challenges?
The company identified a great opportunity in the beginning of the financial crisis. Having gained valuable experience from developing payments and banking software for 8 years, Viva Wallet applied for a Payment Institution license. The process reasonably took some time to complete. In 2012 the company started operating as a Payment Facilitator, initially registering merchants for e-commerce. In the following years, Viva Wallet became an e-money licensed institution and a Principal Member of all major Card Schemes for Issuing and Acquiring.
The major challenge was for the software engineering team to make a lot of critical decisions on the platform architecture. The goal was to deliver a future proof solution in a scalable manner, while simultaneously meeting strict regulatory requirements around security and compliance.
The cloud was obviously the way forward. Microsoft Azure was chosen for a number of reasons related to technology compatibility and cost efficiency. The design goal was to create a secure, robust and scalable infrastructure, that would allow Viva Wallet to expand its business to all EEA-31 countries, covered by the e-money license.
What were the major principles that you based the platform architecture design on, to address the challenge?
A basic principle was No mainframes, no monolithic design. Creating a core banking system from scratch, gives engineers the ability to build on a modern framework, without carrying the weight of a legacy monolithic system – usually running on a mainframe, somewhere in a building’s basement or an external data center. Instead of replicating the architecture of a traditional core banking platform, we decided to break it into microservices. A set of smaller components with only a few hundred lines of code each, that communicate asynchronously using a complex yet extremely efficient fabric, woven by queues and events. Having smaller applications dedicated to performing simple tasks, the solution becomes easy to test, manage, maintain and extend.
Another basic principle was No black-box components. Not relying on legacy payments software often means using third-party services from vendors that do depend on legacy systems themselves. This approach does indeed get you to market quickly, however, you will always be limited by the vendor’s platform capabilities and cumbersome processes.
Having tested this approach in the past, we knew that if we wanted to offer truly innovative Acquiring, Issuing and IBAN account services, we needed to own the technology. To do this, we had to control the internals of every single transaction end-to-end. From the Card Terminal software, to the payments host and all the way to the direct interconnection with the Card Schemes and Payment Systems. Developing our own software, allowed us to build everything on solid ground.
How did you secure continuous service without any breaks or downtime?
The principle of Always on addressed this. When was the last time you wanted to search the web for something, and Google was “down for scheduled maintenance”? You cannot remember, right? Maybe this is because it has never happened. We live in an era where everyone expects online services to be available 24×7, uninterrupted and unaffected by updates, maintenance and all kinds of shortages. Payments should be no exception.
Scheduled downtimes for batch processing, session change, maintenance and updates, are quite common in legacy banking platforms. With that in mind, we designed independent applications that communicate asynchronously in a resilient manner, running on multiple availability zones, across different European regions.
How was openness addressed?
Delivering an open payments platform has always been a key commitment to our customers. We offer a well-documented API that supports every single function, allowing an ecosystem to evolve rapidly. This is what drove our engineering team to create and publish SDKs and API documentation on Github from day one. Customers can easily integrate e-shops, electronic cash registers and enterprise applications (Accounting, Invoicing, ERP, CRM etc.). This approach eliminates manual processes and creates economies of scale that cannot be achieved with the tools provided by traditional acquirers.
What additional success factors for growth and development were integrated in the architecture?
A scalable, personalized and global platform were the principles that would pave the way for growth.
By removing the limitations of on-premise hosting, the cloud empowers scalability. It automatically adapts to sudden or unexpected increases in traffic and transaction volumes. Additional resources are added when required. IT capacity planning to support business expansion into new countries becomes a lot easier.
The cloud is not just a replacement for traditional hosting. Several “platform as a service” solutions are available in the ecosystem of every major cloud provider. Such services enabled Viva Wallet to also build an efficient solution for supporting international sales, by leveraging the power of enterprise cloud-based applications. These vary from CRM, ERP and integrated Marketing Automation, to AI-driven advanced anti-fraud, BI and Analytics tools, just to name a few.
Concerning personalization, it is important to recognize that every individual is unique. The wide adoption of various social media platforms has increased the standards and user experience expectations to a point where it can make or break a business relationship. This is why we decided to disrupt the traditional “customer segmentation” approach, widely adopted by Banks for many years. And since no two social media feeds are alike, we developed a feed engine, that will allow us to offer a personalised communication experience to our customers across multiple channels (web, mobile, even via our Android smart card terminals).
Designed to be a global platform from a technical point of view, the principle of globalization is also very much a strategic challenge. Although significant progress has occurred, it is beyond doubt that the European payments market is still fragmented, hence difficult to penetrate with a product that is identical for all countries. By carefully plotting our course, investing on market research, and integrating with local Card Schemes and Payment Systems, we manage to overcome several barriers to entry. Viva Wallet expands into new markets by offering innovative Acquiring and Issuing services, tailored to the unique business requirements of each country and provide local IBAN accounts for the majority of its European customers.
What can other companies, and especially managers in charge of making technology decisions, learn from your experience?
There is a famous quote by Reid Hoffman, the founder of LinkedIn, which really applies to the IT department of every company operating in a highly competitive environment: “If you are not embarrassed by the first version of your product, you’ve launched too late”.
This Launch First, Ask Questions Later principle, is the new reality; a fundamental lesson for all companies and managers making technology decisions today. The luxury of creating highly sophisticated flowcharts and over-analyzing business requirements can easily drive you behind the competition. This is never an option when you want to innovate and disrupt.
Cloud services have evolved to a point where they provide various options for rapid application design and deployment. Businesses are now able to implement and evaluate new services fast and inexpensively, then quickly decide if they want to invest further or withdraw them. This can only be achieved by an initial investment on a robust and secure architecture; then build on it by taking advantage of the numerous Platform as a Service (PaaS) options offered by the cloud providers.
What is the way forward for Viva Wallet now?
A true Digital Payments Factory, fully operating on the cloud, is where we stand today. We are a multinational company, with local presence in 7 European countries, serving business customers across different time zones and multiple currencies.
Reflecting on how Viva Wallet got here and the challenges ahead, I realize every day that this is only the beginning of an exciting quest. A constant pursuit for technical innovation and disruption in financial services.
About Makis Antypas
Mr. Makis Antypas is a Co-founder of Viva Payments SA, Chief Information Officer and board member of the Viva Wallet Group, leading the company’s Technology Division. He holds a MSc in Information Systems from the University of Sheffield and a BSc in Industrial Management from the University of Piraeus. Senior IT professional, with over 18 years of experience in implementing large-scale transactional systems for the banking, retail, ticketing and electronic commerce industries across Europe.
About Viva Wallet
Viva Wallet is a global, cloud-based digital payments factory providing innovative and reliable acquiring and issuing services to professionals and businesses of any size, based on their individual needs. The company was founded in 2010 and has presence in the UK, Belgium, France, Portugal, Greece, Cyprus and Romania. Viva Wallet is a licensed e-money institution and Principal Member of MasterCard, Visa for issuing and acquiring and a partner to leading global companies, such as American Express, Microsoft, Alipay, and PAX.