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Fintech 12 Nov 2018

Banking on new models in the age of fintech

Who will win the battle between fintech and banks in an age where geographic borders matter less and data is a critical factor in business growth? Actually for BBVA Chief Executive Officer Carlos Torres Vila the answer is simple – it will be the customer. This was one of the key messages he delivered in front of several thousand people at the world’s biggest fintech conference in Singapore, earlier today.

The CEO was taking part in a panel debate alongside Standard Chartered Group CEO Bill Winters, Chairman and President of AMTD Calvin Choi and the President of Nanyang Technological University in Singapore, Professor Subra Suresh, at the Singapore Fintech Festival.

In a wide ranging session, the panelists covered off a broad set of questions, from how the explosion in data can be managed and mined, to how technology is shaping the future of the sector.

Responding to a question around who will be best placed to lend to customers in the future, traditional banks or the fintech startups, Carlos Torres Vila said it was really a question that went to the heart of the future of the sector. He said: “Customer’s financial lives will become much more self-driven, invisibly automated and a lot of that will happen within the wider ecosystem that includes both banks, fintechs and actually big tech.

“Really, though, the question loses its meaning because the landscape will be more fluid, with industry lines blurring. The winner will be the customer, because they will turn to whoever gives them the best experience, and who they trust.”

“The winner will be the customer, because they will turn to whoever gives them the best experience, and who they trust”

The answer also came as part of a wider debate amongst the panelists around the nature of trust, and how data needed to be better analysed and protected. Asked by session moderator Haslinda Amin, Chief Internationalist Correspondent for Bloomberg in Asia, about the explosion of data and how it was being managed, the panelists all agreed data was one of, if not the most important, driving force for the sector.

For Professor Suresh, one of his main concerns given the huge volume of data now being generated, and the multitude of sources it was coming from, was the accuracy of these data sets. He said: “The veracity of data is critical, especially in this now connected world where you have so many data sources. But banks have a great opportunity here to help validate the data sets, and this becomes even more important in a cross border world where the sources have different standards.”

Carlos Torres Vila - Consejero delegado de BBVA - Money2020

Carlos Torres Vila, BBVA's CEO, during 'Singapore Fintech Festival'.

He added that it was a tremendous opportunity, and that at his university one of the key elements they were instilling in their students was around data management – something that was key to producing, as he put it, the next generation of citizens.

It was a view echoed by Winters, who said the successful banks will be those that use data from many sources, but that their success will depend not just on how they get that data but rather how they use it effectively and responsibly.

For BBVA’s CEO, he stated how for the bank data was really the cornerstone for it to succeeding in its purpose of bringing the age of opportunity to everyone. He added: “Data allows us to create solutions, to make predictions and anticipate problems and in doing so to better serve our customers and clients.

“We are seeing a big shift in what owning data means, though. Regulation and awareness means data is increasingly, and rightly, only accessible with consent. And this consent requires a relationship built on trust.

“It’s something we, banks, have had in the past around money, and we have a big opportunity to extend trust into the data world that, and I think, will be a defining element in the future of the industry.”

He added that while there existed big differences around the world in terms of how data is managed – for example the opening up of data sources via the GDPR rules in Europe – the one central core theme around the issue continues to be trust.

He said: “As we move into an era where borders matter less and data continues to explode, the complexity for people to manage their data gets ever greater – because potentially so many different businesses can have access to it.

“But therein lies an opportunity for banks, to help protect people’s data assets and help them get more value from it. It’s a natural extension of our brand. We move from being a money bank to a data bank.”

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