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Innovation 24 Apr 2019

"It’s crucial that the data revolution reaches the most vulnerable"

Carlos Torres Vila studied at the prestigious Massachusetts Institute of Technology (MIT), which is where he gave his first interview since becoming BBVA’s Executive Chairman. He was in Boston to present OpenMind’s new book, ‘Towards a New Enlightenment? A Transcendent Decade’ and sat down with the Spanish newspaper, ‘El Mundo,’ to discuss the explosion of technology in the banking industry. He believes data is fundamental: “It is crucial that the data revolution is universal. The most vulnerable in society cannot be left behind.”

The banking industry has reached an undeniable turning point: the before and after of technological disruption. This is why “the definition of banking – what we offer our customers and what we contribute to society – is changing.” says Carlos Torres Vila. At BBVA, “Our purpose is to bring the age of opportunity to everyone. Hence our motto: Creating opportunities.”

The definition of banking – what we offer our customers and what we contribute to society – is changing

But how does this impact the customer? “It’s about complementing the traditional role of banking,” he explains. It is the responsibility of the banks of the future “to help our clients deal with a problem that’s bigger than money: we have to help them make decisions.” With advances in technology and data science, banks should “develop tools that help customers make more efficient day-to-day decisions,”, like how much they are spending compared to their savings, a feature that is already available in BBVA’s mobile app in Spain. “More and more, banks are providing financial guidance and moving away from a mere transaction-based relationship with our customers.” he observed in his interview with ‘El Mundo.’

In addition, “Technology is helping us to close unfair gaps in society because it facilitates financial inclusion,” he stresses, “in a world where everyone has increasingly powerful phones it is easier to provide our customers with services via this channel.”

Carlos Torres VIla - presidente de BBVA - MIT

Carlos Torres Vila, BBVA's Executive Chairman, at the interview of 'El Mundo'. - Foto de portada: @MIT Technology Review

“Data ownership should be a fundamental right”

Data is the the subject of one of the biggest debates related to the digital revolution. “We believe that data ownership – be it personal data or business data – should be a fundamental individual right,” Carlos Torres Vila affirms. “This means that the use of data must be based on consent. This is something that the EU, with its  Data Protection Directive, has in theory made clear.”

But BBVA’s Executive Chairman believes it has to go further: “We need to identify a blueprint that will allow us to implement this principle in such a way that effectively guarantees the individual right of data ownership, ensuring data is only used when consent is given. This doesn’t happen today.” he says. Traditionally, banks have safeguarded very important, valuable data, and “in the same way we have looked after their money, we can help customers look after their data: helping them monitor and manage the use of their data by third parties,” he points out.

“We need to identify a blueprint that will allow us to implement this principle in such a way that effectively guarantees the individual right of data ownership, ensuring data is only used when consent is given. This doesn’t happen today.”

How is personal data currently managed? “Companies collect data and keep it for themselves. And this data has value, it’s like the oil of the current economy, but as opposed to oil, it can be used over and over again. So it can be useful not only for the company that has collected it but for other companies too, provided the customer has consented to having her or his data shared.” Still, Carlos Torres Vila believes that “everyone should have the power to decide if the data that BBVA has obtained should remain only with BBVA or if other companies should have access to it.

With regard to data, in Europe the rules that apply to banking are different to those of other sectors. “And they should be the same,” he maintains. Why? BBVA’s Executive Chairman gives two reasons: first, “because individual rights should be the same across the board;” and secondly,  “because banks are increasingly competing with companies that come from other sectors.” In short, players in the banking industry are contending with asymmetric regulation.

With regard to the new entrants who are competing with banks, he emphasizes the “clear convergence of industries. In the digital world, there is a blurring of boundaries both geographic – between markets and countries – as well as between different industries,” Carlos Torres Vila explains. “We have also witnessed this in other industries: competitors whose origins were exclusively digital – Apple, Amazon, for example – have ended up opening brick and mortar stores. What is true is that our customers can increasingly do more with their phones; what’s more, that’s how they prefer it,” he concludes.

Cover photo: @MIT Technology Review

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