Spendesk is a complete spend management platform that gives 100% visibility into company spending.

Spendesk replaces complicated and bureaucratic money management with one complete spend management solution that lets customers manage their spending from start to finish – from procurement to multi-currency payments, corporate cards, invoice payments, expense reimbursements, budgets, approval, reporting, compliance, and pre-accounting.

Trusted by over 5000 finance teams, Spendesk increases team productivity and collaboration, provides businesses with visibility and control, and frees up valuable time so finance teams can focus on strategic initiatives to grow the business.

Moving funds is core to Spendesk’s business. Spendesk operates three bank payment flows to enable its customers to:

• Credit their customer accounts and cards via SEPA credit transfer or SEPA direct debit payments

• Pay their invoices from their Spendesk accounts via SEPA credit transfers

• Reimburse their company expenses from their Spendesk accounts via SEPA instant credit transfer or SEPA credit transfer

Spendesk launched its operations using a Banking-as-a-Service provider. It allowed the company to rely on its provider’s license, partner banks, access to SEPA and card networks, core banking system, and compliance services to quickly take its product to market.

As Spendesk scaled and acquired more customers, it encountered limitations that slowed its operations, constrained its product and limited its customer experience.

“As a BaaS customer, we didn’t have our own BIC and IBANs. So when a transfer was sent or received by our clients, they would see the name of our partner, which was very confusing for them,” says Axel Catetand, CEO at Spendesk Financial Services.

Spendesk's reliance on a third-party Banking-as-a-Service provider restricted its product innovation, preventing the fintech from offering key features like instant SEPA payments and Apple Pay support. Spendesk's operations teams also faced frequent instabilities and outages from their provider, which at times prevented customers from making bank payments for extended periods.

Spendesk's greatest challenge was its strategic dependence on its Banking-as-a-Service (BaaS) provider. The provider's generic compliance rules and KYC requirements created significant friction, delaying customer onboarding and even preventing Spendesk from serving certain companies. While the partnership enabled Spendesk to deliver valuable services, being tied to a single provider became a major dependency risk.

Spendesk decided to obtain its own payment institution license to overcome these limitations and integrate a more significant part of the value chain into its operations. It chose the SEPA indirect participant model to do so.

Becoming a SEPA indirect participant means connecting to SEPA CSMs through a sponsor bank, BPCE and its processing operator, BPCE Payment Services. After evaluating several banks in France and Europe, Spendesk chose to work with BPCE Payment Services.

Building bank integrations takes time and requires to build-up internal expertise. In addition, bank integrations have to be complemented with a number of payment automation features to send, receive, and reconcile payments at scale with the appropriate level of visibility and controls.

As much as it brings multiple advantages to fintech companies, the SEPA indirect participant model introduces additional technical and functional complexities.

These include managing R-transactions, incoming payments, and confirmation or rejection of incoming instant credit transfers.

While various solutions exist to send and receive bank payments at scale, the options to connect with banks as a SEPA indirect participant are limited. For Spendesk, it went down to building their bank integration and payment automation capabilities in-house, using legacy vendors servicing traditional banks, or using Numeral.

Because they wanted to focus their engineering resources on their core product, including card issuing capabilities, Spendesk chose Numeral to connect to BPCE Payment Services and manage their SEPA indirect participant payment flows.

The result

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Streamlining millions of payments per year

Spendesk now benefits from Numeral’s direct integration with their SEPA sponsor bank and its overlaying payment automation capabilities to send and receive billions of euros of SEPA payments per year for their 3,500+ customers.

By working with Numeral instead of building in-house, Spendesk saved valuable product and engineering resources to accelerate the development of their platform. In the meantime, its banking operations team now benefits from automated management of incoming and outgoing SEPA payments at scale, allowing it to spend more time improving its processes and supporting its customers, while significantly reducing costs.