Open banking: Bank on savings

With spiralling costs in every direction, no wonder wholesalers are exploring ways to save money and cut costs

Every wholesaler is under pressure to protect its already thin margins and while selling products remains the focus, it’s also critical that costs are reduced where possible.

As Wholesale News talks with wholesalers across the UK about the best ways they’ve saved money, open banking quickly emerged as one of the most impactful solutions.

HT Drinks introduced open banking for customers last year: Director Sagar Thakar said: “HT Drinks had been considering open banking for some time and we are very pleased to be working with Bankzy. We launched open banking at our branches in early December 2023 to offer customers a simple and secure payment option in just a few clicks through their mobile device.”

However, as with every new technology, it’s not as simple as just introducing it to customers and hoping for the best. To find out how wholesalers can make open banking work most effectively, we spoke with Gregg Morris, Director of Bankzy Open Banking.

Bankzy provides open banking for more than 30 wholesalers, processing millions of pounds in payments each month. Clients include Time Wholesale, HT Drinks, Lioncroft Wholesale, Imperial Cash and Carry, KCS Cash and Carry and Elbrook Cash and Carry, with more wholesalers getting on board as we go to press.

So, first of all, what is open banking?

Put simply, open banking allows wholesale customers to pay for goods by bank transfer instead of using a business or personal debit card.

How does this save wholesalers money?

Every debit or credit card payment attracts a transaction fee, paid by the wholesaler. With open banking, wholesalers save on those transaction fees which can equate to hundreds of thousands annually, and they also receive the money instantly.

How does it work?

Open banking can be rolled out in a number of ways, including face to face in depot, an online ecommerce checkout or using virtual payment links sent out via WhatsApp, text SMS, or email.

What kind of savings can wholesalers make?

Typically, wholesalers can save up to £10,000 for every £1m processed by Bankzy.

The benefits are clear for wholesalers, but what about retailers?

Incentives are essential to encourage retailers to sign up. This is why Bankzy Rewards, our customisable retailer/customer incentive solution, is embedded within our platform and transaction flow so that wholesalers can create an incentive for retailers to get started. Wholesalers can decide what amount they want to incentivise retailers with, and the Bankzy solution manages it for them.

This can be a one-off, recurring or transactional amount discount, which are really well received by retailers. The combination of discounts and a great user experience means it’s been a winner for retailers too. It is incredibly fast, really easy to use and retailers can see all their transactions in one place within the app.

We currently have more than 2,000 retail users and the number is growing rapidly. This brings significant benefit to our wholesale customers, plus retailers are using Bankzy at multiple depot locations. In fact, some now prefer it to such an extent that they are choosing only to use wholesalers that offer open banking.

Are there any challenges?

Adoption of customer usage in a face-to-face setting can be difficult. To support wholesalers with this, we have our in-person team present at all our live wholesaler depots throughout the year, engaging and teaching customers how Bankzy Open Banking works. This drives optimised value for wholesalers by leveraging our team to drive results.

What is your one piece of advice for wholesalers looking to make open banking work within their depot(s)?

Use a solution built specifically for wholesalers. Bankzy Open Banking is a bespoke solution created for wholesalers and encompasses a rewards mechanism, virtual payment links and on-site team support to drive engagement with customers. Without the combination of these three key elements, a successful open banking programme would be a non-starter for wholesalers. There will be little to no volumes processed and minimal customer adoption.

WHOLESALER VIEW

DR JASON WOUHRA OBE CEO, Lioncroft Wholesale
“While the reduction in costs are most welcome, particularly as the cost to do business increases, we also recognised open banking as an innovative way to move towards a more modern, frictionless payment solution to enhance our customer experience. As a result, we have not only saved money and added value for customers, but we all benefit from a more efficient payment process. I have no doubt that working with Bankzy will continue to reap rewards.”

RETAILER VIEW

RUHULLUH NOOZAI, Convenience retailer
“I find Bankzy very easy to use. The payment is instant, I don’t need my card and it’s a fast process to complete my payment. I use it for all my purchases at HT Drinks and spend around £3,000 per week.”

MOHAMMED CHAND, Carters News
“I like the rewards I get for paying by Bankzy. I shop 2–3 times a week and I use it for every purchase that I make. It’s easy, simple and straightforward.”

 

MANOGARAN RASARETHINAM, Aishwarya Price Buster
“I have been using Bankzy for some time now and I like it because I know my money has been transferred right away. It’s easy to use and really fast, and I’ve started spending more at Lioncroft because my other wholesaler doesn’t have Bankzy as an option.”

This feature was originally published in Wholesale News issue 2403, which you can read in full here.

Banking Bankzy Gregg Morris Jason Wouhra Lioncroft Wholesale open banking Payment Pros