23 January 2017
Madrid Headquarters
José María Rotellar, manager at Banco Popular Español, and Iker de los Ríos, business director at Fintonic, were in charge of spelling out the main changes facing the banking sector. Both were in charge of running the workshop Reinvention of Industries with Digital Transformation aimed at students on Deusto Business School programmes in Madrid.
The experts passed on their experiences to those in attendance regarding the transformation witnessed in recent years by a sector that until relatively recently was noteworthy precisely for being very traditional, with operations that required a high level of physical presence and a large number of financial institutions.
They began their talk with a look back over the first restructuring experienced by banking in the eighties, in the course of which many overseas financial institutions expanded their network in Spain, and following which the first mergers took place between the seven major banks (with the failed takeover bid by Banco de Bilbao of Banesto and the subsequent merger of Bilbao and Vizcaya). They also analysed the subsequent onset of a trade war with the launching of the Santander super account, followed by new mergers (purchase of Banesto by Santander, merger of Central and Hispano, merger of Central Hispano and Santander, setting-up of Argentaria, merger of BBV and Argentaria) which reduced the number of major banks. Immediately afterwards, the managers of Banco Popular and Fintonic went on to describe in depth the changes that had started to affect the sector with the emergence of the Internet and which have increased in recent years owing to its ever more widespread use
Beyond the use of the Internet, the experts maintained that the use of mobile phones is proving to be a genuine revolution that is affecting banking and which, in their opinion, will transform retail banking.
Indeed, the bursting onto the scene of new technologies has radically changed the outlook for the banking sector, driven fundamentally by the change in customer habits. The experts pointed out that it is now the customer who has taken control of the relationship (they demand, buy and ask). Thus, they are of the opinion that this should be at the core of the strategy. “ One has to be aware of the customer’s life cycle and needs at any given time, and anticipate them“, they maintained.
Among other aspects, they also highlighted the fact that customers now seek other aspects beyond price such as service, added value, quality and personalisation, and added that online banking is no longer just a way of reducing costs, but also of offering the customer value.
They also stated that the bursting onto the scene of startups in the financial services sector does not only entail the entry of new agents and new innovative business models, but is also fostering the swift reinvention of the baking sector.
The experts also analysed the phenomenon of change in banking business which the entry of companies emanating from unrelated sectors such as Google, Apple, Facebook and Amazon is entailing, and focused on the new role of Fintechs which in many cases offer a new collaborative framework in certain products with more traditional banking.
Lastly, they described the main specific features of one of these institutions – Fintonic. This is a free-of-charge application, the aim of which is to improve its user’s finances. They drew attention to this application’s reliability and ease of use, which enables income and expenditure, mortgages, payslips and petrol expenses, etc. to be viewed. And they also went on to explain that applying big data and advance analytics enables Fintonic to group together customers using a segmentation process to identify profiles that may help to maximise communicative and business efficiency.
