Case study: Game changer in the FinTech market expands into foreign markets
Initial situation
A fast-growing German FinTech offering innovative payment solutions was planning to expand into several foreign markets. The company's technology and services were already enjoying strong success in Europe. The strategic decision to internationalize was intended to further accelerate growth. In particular, tapping into the US market promised great success in a scalable market.
However, the company faced new regulatory and operational challenges as it expanded into countries outside Europe. It was particularly important to meet the legal requirements in the target markets and at the same time ensure that all significant corporate risks were covered by insurance in order to continue to act with agility.
Challenges
The expansion presented the FinTech with a number of specific challenges:
- Regulatory complexity: Each target country had its own legal requirements for financial service providers, including licensing obligations, data protection regulations and financial security requirements.
- Hedging local risks: Some markets required country-specific insurance to ensure local compliance, while other markets allowed for flexible global solutions.
- Business interruptions: Setting up new offices and adapting to local requirements increased the risk of delays and interruptions, which could quickly lead to high costs.
- Cyber and fidelity risks: As the company's digital solutions are used in highly regulated markets, both cyberattacks and potential loss of trust by employees were significant risk factors.
- Cost management: The company was looking for a cost-effective solution that would cover the new risks without slowing down growth through high insurance premiums or extensive deductibles.
Our solution approach
To overcome these challenges, we have developed a comprehensive risk and insurance strategy that takes into account the specific requirements of the FinTech company and the target markets.
Key aspects of the solution
- Regulatory compliance:
We analyzed the local requirements in the target markets and ensured that all legally required insurance policies - such as professional indemnity or cyber policies - were in place. - Modular insurance concept: To maintain the company's flexibility, we developed a modular solution that covers both global and local risks. This made it possible to use country-specific policies where they were required, while global cover was used for other markets.
- Cyber and fidelity insurance: We integrated comprehensive cyber insurance that not only covered data loss and business interruption, but also liability in the event of data protection breaches. Fidelity insurance was also implemented to cover potential losses caused by employees or partners.
- Cost optimization: Through careful tendering and negotiation with insurers, we were not only able to secure competitive premiums, but also strategically optimize deductibles to keep costs low.
The implementation
The risk strategy was developed and implemented in close consultation with the fintech company's management team.
- Risk analysis: Together with the company, we carried out a detailed analysis of the industry-specific and country-specific risks. This included legal requirements as well as operational and technological risks.
- Tendering and negotiations: Based on the risk analysis, we put the insurance policies out to tender on the international market and negotiated with leading providers. The aim was to achieve an optimum combination of scope of cover, flexibility and costs.
- Implementation of the insurance solutions: The modular structure enabled us to seamlessly integrate local and global insurance policies. This not only fulfilled regulatory requirements, but also ensured operational continuity.
- Claims management: We also established a clear claims management process that was specifically tailored to the international requirements of the target markets.
Results
Thanks to our customized approach, the fintech company was able to successfully implement its international expansion while creating a strong risk base.
Regulatory compliance
All requirements in the target markets were met, which accelerated market entry.
Comprehensive protection
The insurance strategy covers all material risks, including industry-specific and technical risks.
Cost efficiency
Despite the complex requirements, the premium burden was significantly reduced through clever negotiations and optimizations.
Future security
The modular solution enables the company to flexibly adapt its insurance strategy to future market or company developments.
Conclusion
With our support, the fintech company was not only able to overcome the challenges of internationalization, but also create the basis for sustainable growth. Our expertise in developing flexible, cost-efficient and future-proof insurance strategies played a key role in ensuring the success of this project.
Please feel free to contact us,
if we can also help you to secure your international expansion plans.
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