Lester Isaac Simon
3 min read
ccording to Ramy Taha, ALEXBANK’s head of digital banking and the marketing division, banks and financial institutions play a critical role in fostering a better ecosystem for entrepreneurs. To Ramy, banking is an essential industry, and it has to evolve to support startups in fintech and other industries.
Raised in Canada, Ramy Taha moved to Egypt to study marketing at the American University of Cairo. In Cairo, he undertook his first internship at a mortgage startup and discovered a passion for banking. “I felt it was one of the essential industries needed to support any ecosystem,” says Ramy.
In 2010, he joined ALEXBANK, a leading private-sector bank and subsidiary of the Intesa Sanpaolo Group. As one of Europe’s leading banking groups and one of the most agile financial institutions in Egypt, ALEXBANK has a keen interest in the development of startups. “Every single bank and financial institution has a digital stake in the game,” Ramy says.
River Nile, Cairo. Photo: Sherif Moharram/Unplash
According to Ramy, one of the key challenges for fintech companies is to know what regulations to adhere to. Regulations tend to be in a constant state of flux, so startups can face a lot of uncertainty when it comes to following the right legislation and obtaining the correct licenses.
“The regulatory environment, up until recently, was fairly complex and fragmented, making it difficult for some startups to navigate,” explains Ramy. “However, recent developments by key legislative and regulatory bodies have eased the waters significantly.”
In addition, startups face old industry stigmas, such as the idea that when banks adopt newer technologies, brick-and-mortar jobs are eliminated. However, for Ramy, bringing fintech startups into the banking world creates a greater equity position for all stakeholders, and banks can make a healthy gain working with startups while putting impactful businesses into the ecosystem.
Today, you’re not just competing with other banking or financial solutions, you’re competing against every other application on your device.
According to Ramy, as the banking and financial sectors welcome startups and their innovative technologies into the fold, jobs arise in management, distribution, branch experience and other parts of the sector.
Challenges aside, the market in Egypt has enormous potential. Ramy points out that only about 30 percent of the adult population uses bank accounts, so there’s a lot of room for fledgling fintech companies to find their way into the market. Their distinct and vital advantage at this point, says Ramy, is that they have a fresh perspective and are not cluttered with old school thinking.
As a support player in the ecosystem, Ramy has learned that, above all, fintech companies should focus on creating an amazing customer experience. His advice for startup founders is to choose one thing to do and do it well, and focus on translating that core business model into a simple product. It’s vital to model your company around the experience you’re designing.
“Without a strong customer experience, you’re not going to be able to get your product off the ground,” cautions Ramy. “Today, you’re not just competing with other banking or financial solutions, you’re competing against every other application on your device.”
Ramy also reminds founders that, as it’s a long haul to profit, it’s vital to stay lean and not cut your runway short. “A lot of the time, these young entrepreneurs or fintech companies will have the seed of an idea, and it may seem very good and innovative, but in reality, until they go through real-world testing and start to interact with banks or financial institutions who are typically their end customers or end users, they won’t know if their idea will really succeed,” he says.
By working with Startupbootcamp, ALEXBANK has contributed to establishing Cairo’s first dedicated fintech accelerator. The organization engages with entrepreneurs to get them to the next level in their development. “Where we as a bank really try to differentiate is that we are personally mentoring startups,” says Ramy.
The program helps startups improve their products, find and engage with new markets, and open up bank accounts. It also offers digital financial services for participants, giving startups the runway they need to face the challenge of monetizing. People are used to free or freemium solutions, and margins are shrinking in the fintech field. It’s important to understand how it’s becoming a game of critical mass, so you need that longer runway before generating revenue and turning a profit.
“That’s where we are able to play a pivotal role,” emphasizes Ramy. “The easier we make banking, the better it is for everyone.”
Ramy's top tips for founders.
- Understand what your business model is. For ALEXBANK, customer experience is more important than other facets of your business. To give the best service to customers, you should know who you are, what you do, and what you can deliver well.
- Create a sustainable business model. You have to understand how you’re going to monetize your business, especially with people tending toward free or freemium solutions in emerging markets.
- Stay lean. One key mistake startups make is to start spending money left, right and center the moment you get a big injection of cash. It’s important to stay lean to make the most out of that cash. Also, you shouldn’t be so willing to give away equity easily.
Main photo and Ramy Taha profile photo: Dania Hany
