European payment provider Klarna has become the first customer to go live with smart accounting for financial instruments (smart AFI), a new functionality based on the SAP Bank Analyser set of applications, 9.0 release.
SAP implemented the solution, including accounting rules configuration, data integration and a full setup of the SAP HANA database environment, in just three months.
“Our growth necessitated a centralised accounting system, one that gave us visibility across regional lines of business,” said Max Fischer, vice president, Klarna.
“We were concerned that getting that visibility would take a substantial amount of time and resources, but with SAP we were able to do it in only three months and with zero lag time in operations. It’s had a positive impact on our business.”
The business can now run a centralised sub ledger solution to allow for rapid expansion into new regions and product offerings, while remaining compliant with International Financial Reporting Standards (IFRS) and US GAAP standards.
SAP said smart AFI replaces the classic AFI as the new flagship of the accounting engine in SAP Bank Analyser, developed and optimised for SAP HANA, and can handle multiple GAAP policies across different geographies.
Reno Sager, global head of services for financial services industries, SAP, said the project has shown “that good business outcomes don’t always have to be tied to multiyear, multimillion-dollar projects”.
“We learned that monumental change can happen in a short amount of time when there’s trust, close collaboration and a commitment to delivering the best technology and expertise,” Sager said.
A recent survey conducted by IDC Financial Insights and sponsored by SAP found that six in 10 global banks are open to partnering with financial technology firms.
The stud food that while the relationship between banks and fintechs is improving, banks still need to do more to implement key lessons learned from fintechs to achieve full digital transformation. Although banks might believe they are digitally savvy, the study found that most digitally transformative initiatives are still business-led “islands of innovation” only posing as digital transformation, rather than true business-wide transformation.
“The relationship between banks and startups is an interesting and nuanced one,” said Rob Hetherington, global head of financial services, SAP.
“Banks are in the midst of digital transformation, looking for ways to speed their time to market and to deliver new value or services to customers. Startups on the other hand are mobile, agile and built solely for the customer, yet they lack the regulatory know-how and customer confidence that large, global banks have. Both have something the other wants, and I anticipate that we’ll witness far greater collaboration, integration and – in some instances – acquisitions happening in the next year.”
