SME Banking Conversations: Karol Leszczyński (Comarch)


With this fourth episode of SME Banking Conversations with Olena Gryniuk, we are continuing the series of inspiring interviews on SME Banking, digital transformation, and people making the innovations happen in the industry!

The recording of the fourth episode took place in June in Krakow (Poland), in Comarch Innovation Space. Olena Grynuik – CEE Regional Director at SME Banking Club, interviewed Karol Leszczyński – product development manager at Comarch Factoring Platform. Comarch is one of the biggest providers of digital factoring solutions in the CEE region. And Poland is the biggest market by the factoring volumes and innovations.

Listen to this conversation on our SoundCloud channel:

OG: We are here in Comarch Innovation Space, could you tell us more about the space itself and the innovations you present here?

KL: This is the place where you can learn about the wide range of products that Comarch offers. Every visitor at our headquarters in Comarch can book a free tour to see this space. We present here the products from different sectors, for example, from financial sectors like factoring, Comarch Open Platform, mobile, and many more. We have also other sectors presented here, like e-health, care, telecommunication, and public administration. So, this is the place where you can see a wide range of our products.

OG: How big a team is involved in the development and support of digital factoring solutions at Comarch?

KL: I think right now it’s about 50 people. And what makes me really happy – we are still growing, and I think it’s also worth mentioning that we are working in Agile methodology, and we are working in sprints, usually two-week sprints. That means that our clients are able to see every improvement in usually less than two weeks, sometimes four-five days. I think it’s very important right now.

OG: How many people usually are involved in the project from your customer’s side when you are implementing with the bank or factoring company? Which capacity is needed?

KL: It depends on the implementation. Usually, there are many people involved, product manager, scrum master, testers, analytics, and, of course, developers and usually myself. So, it’s about 50, maybe even 30 people, it depends on how big is the implementation. It will be different for a large factor or a large bank, and a little bit smaller team is needed for the fintechs, for example.

OG: What is your path to Comarch Factoring Platform?

KL: My professional career started at Raiffeisen Bank Poland at that time. It was in 2010, and I started as a relationship manager. My daily task was to take care of the portfolio of over 100 clients. And my job was also to gain new clients and cross-sell banking products, like factoring, overdraft loans, investment loans, guarantees, letters of collections, and many more. And at 2015, I decided to focus on one product, which is factoring. And I think in 2017, I became the head of sales of the southeastern region in Poland.

OG: In Raiffeisen, right?

KL: Yeah. And I think when I became the head of sales, this was the time when I was truly interested in product and product management. And at the end of 2019, I joined Comarch. I joined Comarch Factoring Platform Team, and I’m still here.

OG: How does your working day look like now?

KL: I think my typical day is fulfilled with meetings with the clients and with the team. And also my main task is to analyze the market because, at the end of the day, we need to know, that we need to be sure that our solution and our proposition for the solution meet the standard of the end user. So, we need to know that we are able to fulfill their needs.

OG: Let’s talk about the market and trends in the factoring market. Based on our study that we do every year, and you know that here in the CEE region we have 80, maybe a bit more, banks and factoring companies delivering factoring services to business customers. And from them, we have 17 companies that implemented at least an online application for the factoring for business or SMEs because the solutions are really many focused on micro and small businesses. And 12 of them have a fully digital factoring process. So, my first question to you here, is how you evaluate the Polish market of digital factoring because from these digital solutions we have here in Poland the biggest number of them. So how do you evaluate it? And do you consider fintechs as your competitors?

KL: The situation from previous years showed that digitalization is necessary, and I think many banks weren’t prepared for the stay-at-home regulations. So, I think they still need to catch up with fintechs because they are showing the trends and the path in some way. And when I’m thinking about the fintechs, I’m not sure we can call them competitors for the traditional factors or traditional banks. First of all, they are doing a great job in educating smaller clients, micro clients especially, because a few years back traditional banks and factors didn’t want to cover this segment, especially in factoring. I think they are showing how the online process can be done. The best ones on the market can grant a limit in less than 8 seconds, with a fully online process. I think this is amazing. And when we are comparing this to the traditional factors, I think the process right now, it’s better, it’s faster, and it takes about five days. It’s also a good result. We need to remember that fintechs are granting significantly lower amounts of limits because we are not speaking about the limit of 1 million or 2 million euro. We are above much less maybe 50,000, maybe 100,000 euros. So, the difference is big. But when I’m thinking about SMEs, I think fintechs right now are starting also touching or covering this segment. And if they are able to build a big amount of clients, they will be able to be more competitive with banks about the price because I think right now, especially the price is the issue because fintechs are much more expensive.

OG: Yes, the price is high.

KL: But I think it’s changing. And they are providing, as we mentioned earlier, a fully online process. This is very important right now because the younger generation, in my opinion, they don’t want to go to the banks.

OG: Yes, I don’t like to go to a bank branch either. So yes. And actually, SMEs for the recent years, I mean, the knowledge of what factoring means as a terminology increased during last two years actually among micro and small businesses.

KL: I think factoring is a much safer product than a simple overdraft loan or an investment loan because the risk diversification is based on few debtors, and I think this is very important and that’s why fintechs showed the so the opportunity to start the factoring business.

OG: Which challenges do you see banks and factoring companies facing right now? And how to overcome them?

KL: I think the biggest challenge is when we are implementing the system for a new client. I think it needs to be done in a way that doesn’t affect the end user. In this case, we are talking about the factor’s clients and employees. We strongly recommend dividing the implementation into two phases. The first phase is when we give the go life system when a factor can earn money already. We prepare the branding, the logo, and all the necessary legal regulations. The second phase is when the system is already in the live mode, and we adjust other customer requests.

OG: I know you have a cloud-based software for the factoring companies and banks, which includes, amongst others, matching of receivables and payments, automatic upload of the invoice. Could you tell us more about all the functions available?

KL: I think with today’s mindset and the rapid development of mobile applications, we need to be prepared for the one-stop shop where everything is in one place. Right now, the end customers expect full automation, they need to have everything in one place. For example, they want to have integrated ERP systems, they want to send the reports for external accounting automatically. This is the direction that we need to face. And I think a factoring system should be able to, for example, get every invoice from the ERP system and the only task that customers need to do is to select these invoices and put them into the purchase. I think this is the direction right now.

OG: What banks and factoring companies should do, what are the main steps, on your opinion, for the automation of factoring services?

KL: That’s why I am a big fan of usability tests. This is how we started to implement our software. For example, we invite a few clients from the factors we cooperate with, we write our scenarios and ask them to find this scenario in the system, for example, to attach some files for the invoices, etc. I think this is the only right direction right now because this is how we can understand what they really need because they are dealing with the system on a daily basis. Every day they need to log in, log out and see what’s happening in the system. This is why we started doing this. And of course, when we are talking about the back office, the same thing we are doing with factor employees.

OG: What are you working at Comarch right now and what are your plans for the nearest year?

KL: Recently, we finished developing the new version of our front office system, the 4.0 version, which is based on the newest UX technologies. It’s important to mention that everyone is telling about how good a factoring system should be. But I think about what a good factoring system shouldn’t have, and in my opinion, it shouldn’t have a user manual. If the end-user is not able to navigate through the system intuitively, the system is poorly prepared. Now we are focusing on the back office – the heart of the factoring system – for the factoring employees and factoring workers because we want to simplify their work as much as we can. I really like the quote “If you don’t talk to your clients, your competition does”, if you are not able to provide some solutions for your clients, your competition will provide them. So, we want to be sure that factoring employees do not waste their time on unnecessary things in the system.

OG: Totally agree, Karol, good luck with it. And thank you.

KL: Thank you.


SME Banking Club thanks Karol Leszczyński for participating in our new project and sharing his experience with the audience!

Watch the conversation below: