BudgetBakers has been developing the Wallet app, which helps consumers track their spending and save money, since 2014. Soon after it was launched, Wallet crossed the borders of the Czech Republic and today provides services to clients all over the world, especially in the USA, Russia and Indonesia. The app is currently used by 300,000 active users, and has over three million downloads.
The European PSD2 Directive instructs banks to make their client account data available to third parties, in order to increase pan-European competition and participation in the payments industry by non-banks. PSD2 will come into full effect in September 2019, and BudgetBakers is one of the few fintechs that has so far obtained the licence, demonstrating its progressive position on technology and economics. BudgetBakers plans to extend this utility to other EU markets, as a licence issued by a National Bank opens doors to other EU countries.
“I see the whole PSD2 initiative mainly as a helpful step from the European Union towards financial and technological innovation,” said BudgetBakers CEO Michal Kratochvíl. “So far, banks have had a monopoly on their clients’ transaction data, and now they will be sharing it with fintech, which is driving the force of innovation in finance. This is exactly what the European Commission aimed for with this Directive. We want to continue developing Wallet with as much innovation as the industry allows, which is why we were one of the first to apply for a licence last January. Although the licence was issued by the Czech National Bank and is therefore valid for the Czech Republic, passporting can extend its validity to other EU countries through a simple notification procedure with no additional authorization, which really makes Europe the centre of fintech innovation.”
Wallet has already been linked to user bank accounts, but the Czech National Bank’s licence will provide the application with a direct connection to data in bank API interfaces, under the supervision of the Czech National Bank. After client approval, Wallet will automatically obtain transaction information directly from banks, and not only through auxiliary applications. However, only a few Czech banks are currently prepared for this new procedure. Others still have time until September 2019, when the PSD2 Directive comes into full effect.
Wallet is one of the first non-bank entities to acquire the licence, even though the European Union Directive already came into effect last year, on 13 January 2018.
“The process of obtaining the licence was particularly difficult, because at the time the Directive was created, no one really knew how to proceed,” added Kratochvíl. “We also handle sensitive personal data, and therefore the number of requirements by the Czech National Bank was understandable. All parties want stable and secure banking and fintech markets, so the year-long licence acquisition process is an acceptable cost. Passporting will also help with further growth on the European market.”