Collaboration between banks and financial technology startups could be key for finding solutions in the new environment that the COVID-19 pandemic has brought about. The digital event ‘BBVA Open Talks Global: Fintech Post-Covid’ included how the innovation ecosystem is reacting in the various countries where BBVA is present. Where Spain is concerned, innovation has accelerated and there are already tech solutions on the table to build a post-pandemic future.
Crises raise endless challenges, but there are also opportunities. Faced with an unfamiliar landscape such as the one that the coronavirus pandemic has brought about, companies need to find a way to move forward in an agile manner, able to guarantee their present, but without forgetting to envision the future.
The financial sector is now looking decisively towards this landscape, after years of preparation, in its commitment to innovation and the adoption of new technologies. Fintechs have flourished, with the banks having encouraged this and at the same time fed off it. In the current context, strengthening partnerships with these companies could be key for adapting to change.
Collaboration with fintechs, essential after the crisis
“Fintechs are undoubtedly part of the solution to the problem”, affirms Ainhoa Campo, Global Head of Open Innovation at BBVA. The expert maintains that, in the post-crisis scenario, banks should continue their commitment to strengthening ties with the financial technology ecosystem, from which new opportunities for the financial sector will keep emerging.
Specifically, Campo highlights a range of areas that, given current circumstances, may well be strengthened moving forwards. New opportunities could surface from these areas, and investors may well be more interested in them. “For example, solutions related to e-commerce, digital payment, insurtech, regtech, and proptech - areas on which I have worked in the recent past, both for the bank and working alongside third parties - and on others that may now experience better growth, such as home delivery solutions and small business payment solutions”, she adds.
"This acceleration will also happen because of much tighter collaborations between banks and fintech companies, and many of these startups are already bringing ideas and solutions to the table"
In this sense, the BBVA executive believes that “the most significant challenge that startups are going to face is having access to enough financial muscle to make progress, now that capital risk funds are going to be more demanding”. What is clear, according to Campo, is that the “collaborative trend” will continue to be present in the initiatives that arise because of the crisis.
Technological innovation, faster than ever
In fact, because of the coronavirus crisis, many activities have ground to a halt. However at the same time innovation has been happening at a faster pace, so that technology can find solutions quickly. This is how Pedro Muñoz, Head of Open Innovation for BBVA in Spain, sees it: “There’s going to be innovation coming much more quickly from the market and from banks. It’s necessary to have new agile solutions on the market that are fast and inexpensive”.
This acceleration will also happen because of much tighter collaborations between banks and fintech companies, and many of these startups are already bringing ideas and solutions to the table”, indicates Muñoz.
Among these, Muñoz foresees a clear prominence of technology and a change in customer relationships: “User identification will be reinforced using biometrics and other advances; and signatures will be deferred and remote. New solutions will emerge to cover customer service in the virtual world and to continue digitising administrative processes. Increased use of digital transactions and less use of cash for health reasons is a clear example”.
So this is how the field of financial innovation in Spain is shaping up - banks and startups will work together to support recovery from this situation caused by coronavirus, making use of innovation and technology.
Rodrigo García, CEO of Finnovating, agreed with this point during his participation in the digital event ‘BBVA Open Talks Global: Fintech Post-Covid’. “The fintech sector is trendy in Spain. It’s going to be one of the stand-out industries within the range of opportunities in post-COVID Spain. We are moving towards a new paradigm in which customers are going to be more digital and volatile. Fintechs are going to be the big winners, and banking will collaborate more than ever with the sector in a world that will become a series of platforms”.
BBVA Open Talks Global, a window into the fintech world
This collaboration between banks and fintech and the commitment to technological innovation is not just happening in Spain. BBVA’s international presence and its involvement in the innovation ecosystem make it possible to also be in touch with other countries’ collaboration initiatives with the fintech world.
The ‘BBVA Open Talks Global: Fintech Post-Covid’ event, an initiative from the Open Innovation teams in Spain, Mexico, Colombia, Peru and Portugal which took place simultaneously in all these countries on 20th May, brought together the views of the participating experts on the changes that the crisis will bring about in different regions of the world, and advice on how to continue to innovate in such uncertain times.
Jorge Camacho, co-founder of Diagonal and research affiliate at the Institute for the Future, spoke about strategic foresight: “A discipline that explores a space of possibilities and alternative futures to make better decisions in the present. If we were to have a relatively speedy recovery, the period that we are living through would be a window of opportunity to boost many fintech and digital transformation initiatives”.
From Colombia, Andrés Mauricio Ramírez, Head of Digital Transformation and Financial Inclusion at Asobancaria (the Colombian Association of Banking and Financial Entities), talked of the impact on the country’s financial and innovation ecosystem: “If before coronavirus we were experiencing the growth of digital channels over physical ones, this crisis has meant that mobile banking has skyrocketed, as well as financial operations carried out over the internet”.
This trend is corroborated from Peru by Discipline Head Enterprise Products & Relationship Model at BBVA in the Andean country, Juan Carlos Ramírez: “We found that SMEs were making more intensive use of digital banking solutions. Everyone’s main obligation at the moment is to ensure that the whole payment chain, from what a business generates to the end user, doesn’t break”.
Lastly, Director of Portugal’s Fintech House, Marco Nigris, summarised the Portuguese ecosystem: “We’ve brought together more than 45 Portuguese and European startups that work here to have fintechs as solutions to the coronavirus crisis”, he stated, and he concluded with a call to collaboration, which has been the subject of this event: "It’s important for Latin America and Europe to exchange talent, and by doing so we will generate synergies to tackle this crisis”.
The future if always uncertain, but coronavirus has escalated this uncertainty and we must react quickly and unerringly. The financial sector, working hand in hand with the open innovation ecosystem and new technologies, is ready.