Bassel Chakhachiro (Rabobank): ‘Consumers will not wait for their money’

Being paid directly makes an important difference for consumers, says Bassel Chakhachiro, Product Manager Open Banking at Rabobank. “The longer it takes before you get paid as a consumer, the greater the friction in the customer journey.” To this end, Rabobank has developed the API product Business Instant Payout, which companies can use to make payments to consumers automatically and directly. “Fewer and fewer payment transactions will go through Rabobank’s channels.”

Until three years ago, Bassel worked as a mortgage adviser at Rabobank. In 2019, he switched to Product Manager Open Banking and became co-responsible for PSD2 & Open Banking. “The mandatory opening of account data and payment services to third parties was an eye-opener for banks. We had to open the doors,” says Bassel. Rabobank decided to go all-in and set up the organization accordingly. “Not only so that we can easily implement PSD3 in the future, but also to develop new API services that go much further than what the law obliges us to do.”

Bassel is now working on Business Instant Payout, a paid API service that allows businesses to pay out instantly – within five seconds – automatically. It is one of many open banking products that Rabobank has in mind. “Our strategy is to deliver the best connected bank to be.”

Being the most connected bank, what exactly does that mean?

“That we would like to keep up with the spirit of the times. As Rabobank, we want to be where the customer needs us. It can still be the Rabobank platform, but also in a software package or in the application from a third party.”

What impact has this strategy had on your organization?

“Five years ago, the Tribe B2B services were founded to market all open banking services. They manage the developer portal, which acts as a kind of supermarket where you can find API products from the other tribes, such as housing, payments, investments and insurance. Tribe B2B Services develops the overall vision and manages the portal. From my Tribe Payments, Tribe B2B Services markets our product Business Instant Payout.”

What exactly is Business Instant Payout?

“With Business Instant Payout, a business can perform automated (instant) payment transactions. This is possible via a direct API connection between the customer’s application and Rabobank. This reduces manual actions outside the own system, improves cash management activities and reduces costs and risks. Business Instant Payout is suitable for companies or payment platforms that want to be able to transfer money 24/7 to their customers’ and employees’ accounts.

Think, for example, of health insurance, payment providers or companies that work with deposits for renting tools, holiday homes or cars. With API Business Instant Payout, the customer can send signed individual payment orders to Rabobank at any time. These euro payments are processed instantly without a user interface like Rabo Business Banking. Confirmation of the payment is based on two certificates.

Instant payments are already there, right? What is the added value of Business Instant Payout?

“There is already instant payout for individuals but not for businesses. They prepare payments in a batch in their software and manually sign the payments in the online environment. This works fine for B2B payments, manual approval is an important control step and instant plays a minor role in B2B payments. But for B2C companies there are many scenarios where they want to pay consumers directly based on preset triggers. Some applications are for example:

  • Temp workers or students who work during the day and submit a pay request in the evening via their HR app.
  • Rental companies that immediately refund the deposit upon return.
  • Insurance companies that want to pay out claims immediately.
  • Get a deposit on cans and bottles in your account immediately upon return.
  • Payment service providers who, on behalf of the business, want to pay customers faster.
  • Hardware stores that consumers prefer to pay online rather than cash.

Being able to cash out instantly removes friction from the customer journey. As a consumer, you can also get paid in the evenings and weekends. We see that this also creates a powerful feedback loop, such as when you return your can. You immediately get your deposit back, so you are more likely to do it next time.”

How does this change your customer relationship?

“At Rabobank, we have determined how payments can be signed, such as Touch-ID or Rabo Scanner. With Business Instant Payout, payments are automatically signed using certificates. The responsibility for signing payments therefore rests exclusively with the business customer. We do not test who can or cannot authorize, we only see the API call coming in with a payment order. If this matches our data and the certificates are correct, we arrange the payment within five seconds. It requires the necessary IT strength to set this up correctly and securely. Therefore, we cannot offer this to SMEs, only to business customers with, for example, their own IT department. This can also be a software provider of accounting software that offers Business Instant Payout in Rabobank to its SME and self-employed customers.”

What dot on the horizon do you have in mind?

“Instant payments are now the standard for individuals, and we expect it to become the standard for businesses as well. So fewer payment files via a batch, more real-time requests. Soon everything will be paid as quickly as possible with a high degree of automation, but still with the security you can expect from your bank. This will also go less and less through the Rabobank channels and more through third parties. I expect a shift in customer service over the years. Where previously we primarily tried to bring customers to the Rabobank platform, we see now more added value in positioning Rabobank in a third-party customer journey.”

Arranging banking matters outside the bank, of course, takes some getting used to.

“We actually saw it with PSD2. There was only a small group at the beginning who were open to sharing account information with a third party. There is more and more willingness to do that because you get something in return. The Netherlands is now a leader with Instant Payout for individuals, for businesses, we are currently the first bank in the Netherlands to enable Instant Payments on such a large scale within the business payment system. We see that there is a demand for it in the market, and then suddenly it can move quickly. It is exciting how open banking will eventually take shape, but we are ready.”

About the author: Thomas Lapperre is a copywriter and entrepreneur.

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