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Fintech Act. 22 Aug 2017

How ‘fintech’, ‘bitcoin’ and ‘crowdlending’ help SMEs to work

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Fintech, blockchain technology – together with bitcoin – and crowdlending are tools that help SMEs, which play an increasingly prominent role in the labor market.

The BBVA Innovation Center organized an event to discuss these issues with experts in the different areas concerned, who pointed out many of the possibilities offered by these new tools.

José María Casero Camacho, international financial adviser and founder of the blog “The financial sherpa” spoke about fintech as an SME funding tool.

José María Casero said that “SMEs are at great risk when being financed”. He then gave the reasons for this:

- Lack of knowledge.

- Lack of time.

- Lack of figures.

- Lack of strategy.

The financial adviser also said that “Spain is behind in terms of alternative funding: around 20% of funding in Spain is non-banking, compared with 50% in France and 70% in Britain”.

With regard to SMEs achieving good funding, José María Casero underlined that "the problem lies in the combination, in finding the combination that allows me to meet my needs today and that will allow me to continue to gain funding in the future to keep growing”. He concluded: “New forms of funding exist, but they require something from us, they require us to be involved in our finances”.

Sergio Antón, co-founder and CEO of MytripleA  – a  crowdlending platform – discussed trends in the fintech market and market places.

He explained that “fintech has exponential growth, peer to peer has changed and institutions are now entering in the equation, and, furthermore, returns are fixed regardless of the cycle”.

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The CEO of MytripleA said that “another trend is agreements and alliances between traditional banking and alternative lenders. Banks prefer this because, if there is some customer they cannot fund, they prefer this customer to be funded by an alternative lender with whom they have an agreement, rather than by a bank from the competition”.

Sergio Antón defined MytrypleA as a market place and highlighted the advantages of this over banks. He explained that ”if we go broke, nobody has to bail us out. We are more transparent in general. We don't need capital reserves or a branch network, so we can invest that money in technology, marketing and loan acquisitions. Another feature is that we try to reach everyone – democratizing credit –, whether they have a million euros or a thousand euros”.

Víctor García Pastor, an expert in IT security and Blockchain, and CEO of Criptopay  – a  bitcoin payments management platform –, along with the communications director of the European Institute of Entrepreneurship, who is also a client of Criptopay, spoke on the benefits of Blockachain and bitcoin.

Víctor García explained that “Blockchain is a distributed system allowing everyone to know what is going on. And, what is going on? Well, transactions, movements, whatever. We can move bitcoin money or assets, whatever we want, from one place to another”.

The director of communication for the Entrepreneurship Institute said “we decided to use bitcoin for the uses of our programs, we didn't want to ignore what is going on, the present”. He added: “we receive entrepreneurs from all over, so payments get complicated, but with bitcoin everything is a lot simpler”.

Víctor García ended saying "we have given it added value, obviously payroll still can't be paid with bitcoin, they need cash, so when this payment has been received in bitcoin we automatically convert it into euros and send it to the clients, and these are accepting bitcoin, but what goes into their account are euros”.

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