Vladislav Dimitrov, manager, has been a part of the birth of fintech in Bulgaria. Now his company is a local leader, with ambitions for international growth

Vladislav Dimitrov Dais Software (c)Dragomir Ushev.jpg

Each day, millions of users in Bulgaria use effective, secure and fast bank services from their mobile phones and computers. To a large extent, this is thanks to the vision and targeted efforts of a Bulgarian software developer, who started working in this nation's nascent fintech sector in the late 1990s. Today, the e-banking platform developed by Dais Software is used by four of Bulgaria's five largest banks. The company is now ready to make a step forward and introduce itself on the international market.

Vladislav Dimitrov, director of Dais Software, shares more about this exceptional journey that started with landlines and faxes and is now firmly embedded into the digital reality.

What changes in Bulgaria's fintech field have you witnessed since you entered the field, 25 years ago?

I would give a more general answer – back then, the fintech field in Bulgaria was practically being born from nothing and grew to its current condition as a vital and irreversible part of work for consumers in solving their personal and financial needs and tasks. Our first projects that started in the previous century (sounds weird, doesn't it?) used landline telephone and fax banking, today we have online and mobile platforms with full banking and financial functionalities, and extended AI capabilities offered in the cloud. The changes are hard to grasp. Indeed, this is an entire history of the creation, building and development of a large business field.

How is Bulgaria positioned in global fintech trends?

There is a positive and not that positive way to look at Bulgaria's positioning in global fintech trends. On the one hand, the country has a rather compact banking and finance environment with a relatively small number of financial institutions. For years, these have been connected in a robust, standardised interbanking infrastructure. Additional plus is the fact that the local environment is harmonised with the EU regulations. In the past years there has been a clear focus on the sector's digital transformation and, in particular, on developing digital channels and user experience. So, Bulgarian financial institutions, both banks and others, have a good and stable range of core functionalities and options that allow consumers to do their job.

On the other hand, when comparing Bulgaria to the leading markets in this field, the country lags significantly in terms of innovations and functionalities with added value above the fundamental level. This, of course, is also an opportunity for the local market to learn from the experiences and mistakes of more advanced markets and to skip some of the levels in its pursuit for more comprehensive e-banking services.

What is the near future of the fintech industry, in your opinion?

As a company that narrowly specialises in fintech and more particularly in digital channels for banking and financial institutions, it is only natural to be optimistic and to hope for the intensive development of these services. The goal of the fintech industry, or to put it more broadly, of all players on the market (traditional banks, innovative startups, non-banking financial institutions, technological giants with ambitions in this field), is to give a digital shape to all processes and scenarios for financial services to the clients and to make and keep that a successful and profitable business. As I already mentioned, the starting point of the local market is relatively low and the perspectives are excellent. By all means, this is good for the customer who will have a broader selection of digital financial services to choose from. However, there are many challenges. One of the biggest is the user's attitude and digital culture. It cannot change overnight and needs time to mature. There are many examples, including from our experiences, in which digital services outpace the local market. Of course, this is a natural part of the process of adapting and development.

What are the main trends in the field?

I would outline the following directions. Let's start with the development of payments which have a major function in the society. The natural evolution in payments, which is additionally supported by European regulation, is turning them into a generic and easily accessible service that is almost transparent for the customer in all usage scenarios. Open banking (the capability provided to consumers to access their bank accounts not only directly through their bank, but also through other suppliers) and instant payments will open opportunities for a wide range of flexible payment services. This is related to the broader topic of embedded finance – the opportunity to integrate banking and financial services transparently for the consumer in nonfinancial services and applications.

The trend for digitization of all processes, connected to the relations between financial institutions and the users – or simply put, the largest possible part of the activities that require clients to visit a bank and to physically communicate with financial experts, will now be possible entirely online or via a mobile app.

The development of services with added value on top of the basic standard financial services will also continue. For example, part of this trend is the transformation of run-of-the-mill bank mobile apps into superapps with diverse functions that clients can use, even ones without pure financial aspect.

We cannot skip AI, it is a matter of short time to see a real quality and effective application of AI in different usage scenarios – from client service by a help desk and a call centre belonging to the financial institutions to, for example, hyper personalised offers to the consumer.

When you were starting Dais Software, what convinced you that the company had a future on the market? Why did you choose to push on with the idea?

When we started our first projects in the banking sector over 25 years ago, these were some of the first steps towards implementation of more modern and user-oriented systems for banks in the Bulgarian market. It started almost by chance, when we were contracted to work on a new project for a system for remote banking via landline telephone and fax. The client was one of the foreign banks that were entering the Bulgarian market at the time. It was similar to the current IVR systems used by mobile operators for checking one's account and service management on the phone. However, when the Internet became a staple on the Bulgarian market, we somehow quickly identified the excellent opportunity to develop our own product for online banking services. At the time, some people thought it was the pinnacle of innovation. Joking aside, we developed some of the concepts that are now seen as a given, like omni-channel, banking services on web and mobile phone, as early as 2000. Of course, these used the available technologies at the time. Apparently, we were pioneers on the market and within a couple of very tough years, some of the large banks trusted us and we took the key decision to focus entirely on digital channels for banks and financial institutions. We have never looked back, although during a significant part of this period, basically until 4-5 years ago, digital financial technologies were still not a priority for the financial sector. We had to fight for the development of these services.

Which were the core steps towards success that Dais Software made from its founding until today?

I believe that the success of Dais Software is based on the core principles that were present since the company's very beginning, both as a business and a team. We have always tried to demonstrate reliability and continuity, and strived towards making our clients comfortable that they can trust us to do the required job. Our projects and engagements are very long-term and we are obliged to offer consistency and integrity even in the most dynamic processes of transformation and restructuring in the respective institutions. The company was more focused on the technology and the product to ensure effectiveness and benefits for the clients, and less on the sales and aggressive business growth, with all the advantages and disadvantages of this strategy. Last, but not least, at Dais Software the focus is on maintaining the highest level of expertise and pragmatic adaptation and implementation of the innovations in our field.

How the services and products of Dais Software improve the user experience?

Our core product is a platform for online and mobile bank and financial services that is currently used in different configurations by four of the five largest banks in the country. The scope of our platform is very broad, covering financial functionalities for individual clients, small and mid-size companies, and corporate clients. Happily, this type of services have been now on focus in the past couple of years. The development of our product today is very intensive, a significant part of our efforts towards offering to the consumer easy and convenient online processes. In the end, the financial field cannot stay aside from the trends for user experience imposed by the leaders in other online fields.

An interesting direction for development of our product is its adaptation as a fintech service for end-customers, based on open banking, that gives opportunity to individual and business users to manage their personal or corporate finances via analytical tools, to initiate payments, to use additional services between banking and accounting such as e-invoices, cash flow predictions etc. We are developing this service together with BORICA under the brand name InfoPay.

What do we, bank's ordinary individual and corporate clients, not know about the "mechanisms" powering modern digital banking?

It is hard to answer in just a couple of sentences, but we can sum it up by saying that these are some of the most complex and difficult to implement projects in the field. It is mostly because of the need of integration with extremely diverse systems, processes and environments in the back-end of the respective institution. The end users can hardly guess this complexity and it mostly remains hidden from them. Sometimes, behind a single seemingly simple functionality consisting of 1-2 screens and buttons stand thousands of lines of code, dependencies, relations and exchange of data between several systems, including ones outside the bank. All of this is subjugated to strict and unconditional requirements for security, high performance and service reliability.

Tell us more about your international plans. What is the biggest challenge when working on foreign markets?

Historically, up until now, our company has been focused on the Bulgarian market with a couple of relatively small projects in neighbouring countries such as Northern Macedonia. Our plans for the upcoming years include offering our products and services to foreign markets. The main challenge is the specifics of our potential clients – mainly large, even multinational financial corporations. They have exceptionally high requirements towards their suppliers, including to their size, team and financials. Also, our platform requires complex adaptation and integration, and in practice it is always a part of a broader digitization project that includes other platforms and components of the bank or other suppliers. We consider ourselves a leader on the Bulgarian market, but objectively speaking our size is relatively small to make it on our own in Germany, for example. This is why we need well-positioned local partners that can provide the bridge that we need with their already established local sales and integration expertise. So, our approach includes building a network of partners in the target markets with which we will share synergy and will be able to offer together optimal solutions for digital services.



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