Wow, the year 2023 was an incredible ride from my perspective. I love waking up on weekday mornings with my head full of thoughts about the small steps I will take today to move Finax a little bit further. However, when you are surrounded by almost a hundred colleagues who share the same mindset, it all turns into an unstoppable machine. In this blog, I will walk you through our plans for 2024.

Our Goals and Plans for 2024

The financial markets experienced a solid growth already in the past year 2023. The current development of markets, however, often reflects the expected future path of the economy, which the consumers will only feel later. We expect the markets to continue growing this year, but the average consumer has yet to feel the improved economic situation in their pockets. Therefore, from the perspective of sales goals, we have set more conservative targets (though still very ambitious given the current economic situation):

• 1 billion euros in assets under management, solidifying our position as a leader in asset management among investment brokers in Slovakia.
• 100,000 active clients with some assets under our management, aiming to obtain them not only through traditional managed portfolios but also through the pan-European Pension Product PEPP and via B2B partnerships.

Surpassing these milestones will catapult us into the top European fintech league in the field of investment management. Here are the initiatives through which we aim to reach our targets:

• Integration of the software we obtained via acquisition into our systems.
• Significant growth of pension products in Poland, Croatia, and Czechia.
• Launch of the new Financial Wellness program, which will provide financial education to companies.
• Development of a B2B sales division for our software solutions.
• Portfolios denominated in local currency.
• Improvement of our core Intelligent Investing service.

Software Integration Will Enhance Finax’s Scalability

One of the main reasons for the acquisition of the investment division of the Belgian Aion Bank was to obtain their software for the management of client assets. This software, which was developed over several years, fulfills most of our requirements for a new and better trading software, which we originally planned to develop ourselves, starting from this year.

Therefore, the acquisition and the product itself came in very handy. What are our expectations from the software?

• Increased flexibility when reacting to changes and product needs.
• Increased processing speed of all operations – receiving payments, trade realization, generation of client documents, or regulatory reporting.
• Greater scalability, enabling us to serve millions of customers in the future.
• Better preparedness for the Western-European client in terms of portfolio management and tax optimization.

So far, we’ve been running on a software used by most Slovak and Czech investment brokers. However, we find the possibility of individual programming according to our needs (brought by this software) to be crucial for our future fintech development.

Pension Products Should Become Our Key Acquisition Channel 

The first year of our pan-European Personal Pension Product (PEPP) is now behind us. As of now, it is not very widespread in Slovakia, especially due to limited tax benefits granted by the state. However, in other countries where we have implemented PEPP (or plan to do so this year), the product received attractive tax and levy benefits. See for yourselves in this table:

Taxwise, the product is specifically attractive in Czechia, Croatia, and Romania. This is because, provided the product is set correctly, there will be no obligation to tax the money when making a deposit, during the process of savings accumulation nor during the payout of retirement benefits. It is also interesting in Poland where a very strict tax regime applies to ordinary investments, while PEPP was granted a tax exemption.

The product already represents a significant acquisition channel, and we expect its significance to continue growing in the upcoming years.

Launching Our Financial Wellness Program to Increase Financial Literacy in Companies

This year will bring the launch of our unique Finax Financial Wellness program designed specifically for companies and their employees. Our long-term experience in increasing financial literacy has now been used to create a complex educational program, covering all aspects of financial health.

The courses offer practical tips and tools that help to manage personal finances efficiently – from creating a balanced family budget to building up an emergency fund and ensuring a stress-free retirement.

Here in Finax, we believe that having one’s personal finances in order is one of the foundations of living a comfortable life. Moreover, it has been proven that employees who have their finances under control are happier, more productive, and make a greater contribution to their employers. If youu’d like to learn more about the ways in which we can help your colleagues and employees, be sure to contact us at business@finax.eu.

However, our education efforts will not be limited to companies, we would like to provide this kind of knowledge to schoolchildren as well. In cooperation with the non-profit organization financie.sk, which I co-founded, we have recently introduced a new textbook for middle-school students.

We will try to interconnect these two projects and use company sponsoring to supply schools with as many textbooks as possible. Because we realize how crucial and beneficial such kinds of knowledge can be for our children.

Establishing a B2B Sales Division

Investing is slowly becoming a mainstream affair in Europe. The growth of client assets is significant, especially through modern fintech solutions, such as those offered by Finax. Investment applications are springing up like mushrooms after the rain.

Acquiring a license and building everything from scratch is difficult, but also costly. Thanks to our software solution, our partners will be able to create their own investment platform under their own brand. We got this service by acquiring a part of Aion Bank's business and intend to spread it to other investment and pension products.

We’re already offering such assistance to our German partners. For example, UnitPlus – one of the fastest growing German fintech companies – offers their clients investment products under its own brand, but utilizes our license and software.

If you can’t imagine this in practice, here are a few examples:

• Intermediaries selling investment products can create an investment platform under their own brand, setting their own fee policy.
• A bank which does not offer investment products can add the offer into its app.
• An app which offers other investment products (e.g. crowdfunding, crypto, financial education, tax management) can create a new product for its clients – investing (thus gaining additional stream to monetize its client base).
• Banks, insurance companies, or asset managers can now start offering pension products using our software, thus adding this “sticky product” (product where the client stays with the provider for a longer period of time) into their stock.

We know it would be too difficult to establish ourselves in the saturated Western-European market by relying solely on our Finax brand. We do not possess knowledge of the local environment, the market competition is high, the entry costs would be significant, and an Eastern-European platform is simply not trustworthy enough in these countries. Therefore, we want to focus on established players with an existing client base, to whom we may offer a good-quality product and our experience.

Preparing Specialized Portfolios in Local Currencies

Interest rate differences can be quite unpleasant, and clients are highly sensitive to currency movements in Euro-denominated portfolios. Slovak and Croatian clients do not have to worry about exchange rate developments, as they both use the Eurozone’s common currency.

However, in Poland (where the Zloty strengthened against the Euro significantly in the aftermath of the elections) our most dynamic portfolios have only shown a 6.3% annual return in 2023 after conversion to Zloty, while the annual return in Euros was 14.6%. In Czechia, on the other hand, the annual return of our 100% stock portfolio was 17.2% thanks to Koruna’s depreciation against the Euro.

That is why we have been planning to create portfolios denominated in respective local currencies for some time. Poland will be the first market in which we’ll introduce this offer. However, the process is indeed technically challenging, and we will need a few months before these products get to see the sunlight.

The product should be composed of tools traded at the Warsaw-Stock Exchange, and we are really looking forward to this challenge.

Intelligent Investing Remains Our Core Product

Intelligent Investing as you know it, including the Intelligent Wallet and the Smart Deposit, still remain our core products, and we shall approach them as such.

We are not planning to slack off when it comes to content production, as we deem it one of the highest pieces of added value our clients receive. However, we also see room for improvement in this sphere, especially in the field of AI and deepdub technologies, thanks to which we would be able to deliver our educational podcasts and videos abroad in respective local languages. We monitor these technologies closely, believing that AI development will continue at a sufficient pace to make this vision possible this year already.

Since our IT capacities will be mainly used for the development of our new trading software, there will be likely less visible changes for the clients themselves when compared to previous years.

That’s why I will make fewer promises this year, but we care all the more about their fulfillment.

We are going to redesign the basic dashboard in our Finax app to make the information more neatly organized, providing the client with a clearer overview of their assets in Finax.

After several postponements, we will finally launch the option to track accounts of multiple clients at once in the Finax app.

Thank You for Your Trust! 

What else to say? After all, it is you, our clients, who are moving Finax forward with all your suggestions, ideas, or by seeking solutions to problems that bother you. All we have to do is listen closely and be open to changes that will improve the quality of our services. Step by step.

Finax now consists of more than 80 people who work diligently to ensure your life stays on a solid financial footing. Thank you for your trust!