ALUMNI SPOTLIGHT: NORDIGEN
Nordigen participated in the Mastercard Lighthouse Program during the fall of 2019. We sat down with Rolands Mesters, CEO and co-founder, for a conversation about Europe’s first freemium open banking platform and their experience from the program, as well as a discussion about the open banking industry. Nordigen is operating within the open banking field; helping banks and lenders improve the speed and accuracy of their credit decisions. They do this by offering account-based income verification, transaction categorisation, and behavioural scoring solutions. Mesters says that “Nordigen is a new company every 6 months – we have reinvented ourselves 6 times since the start, but today we are operating as an open banking company.”
The open banking space is interesting, but also challenging. Nordigen is on a mission to make open banking data easy to use and with this, Mesters wants to figure out how to help others to adopt open banking using Nordigen’s free banking data APIs, as well as formalising how Nordigen can help their customers in handling data.
According to Mesters, they joined the Mastercard Lighthouse program to get exposure in the Nordic fintech scene. When Nordigen joined the program, they were just launching a self-service model, and Mesters says that meeting with the banks and attending events acted as a great platform that allowed them to check their new concept. The program also helped them in testing how to communicate about the platform, what parts of the messaging they had done right and on what areas they could improve. Nordigen was also launching a cooperation with Tink during this time, and Mesters points out that the program allowed them to explore that collaboration and get some insights from the larger open banking platforms. Nordigen did not sign any partnerships during or after the program, but they engaged in several discussions.
“The Mastercard Lighthouse Program allowed us to shape the vision of the company. We have nothing but positive feedback about the whole experience. Through the program, we also got the opportunity to present on stage at Slush,” says Mesters.
Regarding trends in the industry and expectations on how the market will evolve after the crisis, Mesters has a lot of insightful thoughts about the market,
“The industry dynamic in general has lot to do with consolidation. I think what is happening is an unnatural consolidation to some extent – it will be a handful of actors that take a large part of the market share and open banking is super fragmented, there is about 6000 bank integrations that someone has to do. A good chunk of companies will be able to do a big part of that, all across Europe. My gut feeling is that it is going to be companies such as Tink, Mastercard maybe Klarna who will focus on serving the enterprise segment of the market, while companies like Nordigen will cover the non-enterprise parts of the market with a freemium open banking model. This is going to develop in the next couple of years, to eventually consolidate to a couple of mega companies as we saw in the card space with Mastercard and Visa. It will take time and it will be messy on a country-by-country level.”
CEO & co-founder
Looking ahead, there is a lot of work to do when it comes to the collection and treatment of data. Mesters wants to continue working with these challenges within Nordigen as well as continue figuring out how to help developers and companies adapt, especially when the market is not adapting fast enough in the eyes of the players in the open banking field.
Finally, in late 2020 Nordigen launched a free PSD2 data API covering Europe. The feedback from the market was polarizing, some thought this is way too early to do while others celebrated. Nordigen continues its growth journey leading a new path within the open banking space.