Former Westpac workers launch fintech solution to common office headache

Daniel Kniaz and Russell Martin reckon they’ve solved one of the most annoying inconveniences — the dreaded expense form.

The 27-year-old former Westpac workers, who met in the bank’s innovation team, have launched a new fintech start-up they believe will solve what is a major issue, particularly for small businesses.

While banks offer large organisations corporate credit cards, small businesses are “greatly underserviced” in the sector, according to Mr Kniaz.

“You might be a fast-growing start-up with a couple of million in the bank but you’re not yet cashflow positive, so the bank doesn’t want to give you a credit card, or simply, you have a growing team and the bank will only give you 10 cards,” he said.

The pair left Westpac in 2017 and entered the H2 Accelerator program, where they initially began work on a consumer product.

Their company started as a sort of shared bank account for split payments that would allow groups access to a shared virtual card to make payments for things like rent or utilities.

“We had some good traction but essentially what we found was it was very difficult to get customers to actually activate,” Mr Kniaz said. “We saw lots of downloads but pretty slow activation.”

The second iteration of their virtual card was pitched as a security mechanism for online shoppers who didn’t want to use their real card details.

“We scaled that very quickly and got into a couple of online communities and forums where people liked how easy it was to create an instant virtual card,” Mr Kniaz said.

“But ultimately we found it very difficult to monetise consumers, particularly in the finance space — consumers want everything for free.”

Many of those customers said a similar product could be applicable to their business — it’s common practice for small businesses to share the owner’s credit card around or have employees cover expenses and claim them back.

DiviPay, which launched in January and recently inked an integration deal with accounting software firm Xero, is a virtual credit card and automated expense reporting system for small businesses.

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Source: Westpac: How two bank workers solved one of the biggest office headaches