In a pivot that may be indicative of a broader future trend, Spanish bank BBVA is shifting its focus to the digital realm. As Richard Handford reports in a post on the website for the Mobile World Congress, where BBVA CEO Francisco Gonzalez spoke in a keynote session, BBVA sees the threats posed by non-traditional financial services companies as a welcome invitation to innovate and compete.
“We need to be more efficient but we can also collaborate with them,” Gonzalez added. He explained that BBVA is currently developing a cloud-based wallet app, having an American banking startup last year and also having partnered with an online payment company called Dwolla. He said that while his company only has 3000 of its 110,000 staff currently working on digital projects, he believes in five years’ time the majority of BBVA staff will be working in that area, and he expressed optimism that the availability of non-traditional routes to getting bank accounts could present opportunities to attract more customers.
The traditional banking industry is facing a number of challenges from the digital revolution. For one thing, commerce is going digital and consumers are starting to embrace the convenience of mobile payment platforms like Apple Pay and its forthcoming rivals. That is increasingly pushing banks out of the commerce picture, effectively eliminating the middleman, though it’s also presenting opportunities for financial services organizations willing to partner and collaborate with such platforms, as in the case of Visa. Another danger comes from digital-only banks, which are able to operate at a much lower cost and to offer customers more innovative services. The whole financial services sector is shifting quickly, and it’s prudent of banks like BBVA to take a proactive approach towards innovation and adaptation.