SEBx: Unlocking innovation in the financial services world with Google Cloud
About SEBx
The innovation studio of Sweden’s SEB Group, SEBx seeks to drive progress, push boundaries, and break new ground in the banking industry.
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About Thought Machine
A Google Cloud Premier Partner, Thought Machine provides banks with Vault, a modern API-based platform that can be customized to the needs of individual clients.
SEBx is building its next-generation banking platform in Google Cloud to leverage the benefits of cloud technologies, including cost efficiency, flexibility, and scalability.
Google Cloud results
- Supported SEBx in setting up, designing and running a cloud-based bank within the incumbent bank
- Allocates limited resources for maximum effect thanks to the elasticity and scalability of Google Cloud
- Integrates innovative technology, such as Vault from Thought Machine, with a modern, flexible cloud-based infrastructure
Generates new clusters in minutes to boost development
Driving innovation in the financial industry can be a challenge. With heavy regulatory requirements, new ideas and technology have to be as secure as possible to ensure clients’ financial data remains safe and processes remain compliant. In an industry dominated by centuries-old titans, recent innovations and disruptions have come from smaller players whose agile setup often allows them freedom to experiment.
Sweden’s SEB, a 165-year-old financial institution, is shifting this paradigm.
In 2018, the bank formed SEBx, an innovation studio that has access to the bank while functioning as a semiautonomous startup. “We’re in a unique position in finance,” says Martina Nordenson, Chief People and Organization Officer at SEBx. “We get to access the resources of a 165-year-old bank and blend that with the agility and speed of a startup.”
“Google Cloud gives us the scalability, modularity, and flexibility to provide the best service to our customers. Protecting our customers’ data is also a key priority for us, and delivering uncompromising security is clearly a top priority for Google Cloud as well.”
—Martina Nordenson, Chief People and Organization Officer, SEBxSEBx began in 2018 as seven people in a conference room. They were tasked with trying to find out how to build a bank from scratch if they could start fresh. After days of brainstorms and pooling of expertise and consultations with the bank, SEBx shaped what then became an important strategic foundation: a dual-purpose mission to “build new products and explore new tech.” In other words, technology exploration should be driven by a mission to build great products, ensuring that innovation also translates into real value for customers. At the same time, the team aspired to build a technology platform that, if successful, should be able to lend itself to other parts of the SEB Group too, as well as to external partners in the way of a “banking as a service” platform. The first product to be created on the SEBx platform was named UNQUO—a digital financial product designed for the self employed, or the “solopreneur.” This is a customer segment which, being both an individual and a business customer at the same time, has often proved a challenge to serve effectively for the banking industry. UNQUO set out to change this.
To start building the SEBx platform in the cloud was an obvious choice. “Most banks with more than 20 years of history are built from the ground up on mainframe technologies hosted on-premises. Today, it’s hard to imagine setting up a financial services business that is not cloud native,” says Christoffer Malmer, CEO at SEBx. Against this backdrop, the SEBx platform was going to live on a cloud-based infrastructure, separate from the main SEB stack. After evaluating the leading cloud providers, SEBx decided to build its infrastructure with Google Cloud.
“We’re looking at an industry on the cusp of a monumental shift toward more powerful technologies, and for SEBx, Google Cloud is an important partner and catalyst to accelerate this shift,” adds Christoffer.
“Google Cloud gives us the scalability, modularity, and flexibility to provide the best service to our customers,” agrees Martina. “Protecting our customers’ data is a key priority for us, and delivering uncompromising security is clearly a top priority for Google Cloud as well.”
“We’re running as many of our workloads in containerized applications as possible. Virtual machines alone are great and easy to set up, but you still need to manage them. With Google Kubernetes Engine, so much of the management is done for us, which has really improved our workflow.”
—Liudas Tautvydas, CTO, SEBxA new kind of infrastructure for a new kind of bank
While the SEB Group already had a very reliable infrastructure, part of SEBx’s mission is to build new technology from the ground up. The team decided from the start that UNQUO would be built on the cloud rather than the existing on-premises platform.
Even with the backing of its parent bank and the benefits that come with being part of an established organization, SEBx is still a small team operating under start-up-like conditions. Forming partnerships was not just strategically important, but also a natural part of a cloud-based operating model.
The first step was to find technology partners to manage the more traditional operational elements of the bank. That allowed SEBx to focus on creating the best possible experience for its customers. For the core banking elements, SEBx chose Vault by Thought Machine, a Google Cloud Premier Partner. Built around APIs using a Google Cloud architecture, Vault provides SEBx with key functionality without the need to build from scratch. Instead, it allows banks to represent financial products as code within the platform itself so they can migrate existing products over, as well as write entirely new banking products from scratch. Being able to do this is essential for delivering UNQUO’s combined card and account functionality.
As well as Vault, Google Cloud provides the infrastructure for the rest of SEBx’s platform. After initially experimenting with virtual machines, SEBx decided to build its architecture using Kubernetes, the open-source container system developed at Google. With Google Kubernetes Engine (GKE), SEBx can offload much of the management overhead.
“We’re running as many of our workloads in containerized applications as possible,” says Liudas Tautvydas, CTO at SEBx. “Virtual machines alone are great and easy to set up, but you still need to manage them. With Google Kubernetes Engine, so much of the management is done for us, which has really improved our workflow.”
SEBx also uses Pub/Sub for messaging services and Google Cloud operations tools for monitoring and troubleshooting. Meanwhile, Cloud SQL automates other time-consuming tasks, such as database provisioning and storage capacity management.
“With Google Cloud, it’s very easy for us to work out how much each service costs and calculate the cost of each transaction. It means we can optimize our resource allocation and really focus on the areas that will improve the service for our customers.”
—Liudas Tautvydas, CTO, SEBxGoogle Kubernetes Engine for a flexible, agile infrastructure solution
With the help of Google Cloud and Vault, SEBx has taken important steps towards its vision to build a technology platform for next-generation banking products. The first product, UNQUO, was launched in beta in the first year, along with building a thriving community of more than 1,000 freelancers. UNQUO, planning to scale up during 2021, gives each customer a mobile app tied to their bank card, which allows them to manage their accounts wherever and whenever they need to.
Instead of dividing customers’ accounts with separate business and personal cards, UNQUO offers a single combined account. Using the app, customers can designate payments as business or personal expenses up to thirty days after making a purchase. This eliminates the need to manage two accounts or deal with payments made using the wrong card.
The app also includes integrated expense management, allowing customers to take photos of receipts that automatically get filed for bookkeeping. “All our feedback from our customers has been about how much easier we’ve made their lives,” says Martina. “We really want to simplify things as much as possible for them.”
Working with GKE and Google Cloud has given SEBx more control and agility than a traditional on-premises infrastructure would have done. One of the most important benefits for SEBx is the clarity that a cloud-based stack provides.
“With Google Cloud, it’s very easy for us to work out how much each service costs and calculate the cost of each transaction,” says Liudas. “It means we can optimize our resource allocation and really focus on the areas that will improve the service for our customers.”
Using managed services in GKE also allows SEBx to work quickly and efficiently, scaling up and down as required without having to worry about configuring new hardware or running up costs on idle servers. “With GKE, there’s a newfound flexibility to our work,” says Liudas. “If I need to create a new instance or a new cluster, I don’t have to plan the capacity or convince anyone to get me new hardware. I just copy the script for the new instance into the pipeline and in just a few minutes, it’s running.”
Ahead of UNQUO’s commercial launch, SEBx is already looking for ways to improve on what it has built so far. The team is currently exploring BigQuery and Dataflow for access to cutting-edge data analytics at speed. “The financial services industry has only scratched the surface of the opportunity to create unprecedented user experiences with new technology,” says Christoffer. “Personal financial management, for example, can be greatly enriched with proactive and relevant advice that takes into consideration each person’s preferences, interests, risk appetite, habits, ambitions, and aversions. The fact that it’s possible to achieve this with data excites me about the future,” he shares.
“The goal for us is to be a data-driven organization,” adds Liudas. “We want to use data in real time, not just to determine how we make our decisions but also to help our customers, for credit scores or fraud detection for example. Strategically, when we look at where we want to go, I think Google Cloud will definitely help us get there.”
Tell us your challenge. We're here to help.
Contact us
About SEBx
The innovation studio of Sweden’s SEB Group, SEBx seeks to drive progress, push boundaries, and break new ground in the banking industry.
About Thought Machine
A Google Cloud Premier Partner, Thought Machine provides banks with Vault, a modern API-based platform that can be customized to the needs of individual clients.