and sit them with a startup that’s disrupting that world in a way that they never anticipated, it’s like a physical transformation comes over them,” he says. BBVA has repeatedly made clear its aim to transition from traditional bank to software business. It invests in fintech through its venture capital arm, Propel Venture Partners, and through its recent partnership with Anthemis to create a venture creation studio in London. And has also launched several fintechs of its own – including insurtech Denizen, identity protection startup CoVault and money transfer app Tuyyo. White describes himself and his colleagues at BBVA as ‘user-centric technologists, creating the future of an industry’ – one that will be increasingly autonomous. As in the car sector, which started on the same trajectory some time ago, he says there are five levels of autonomy in banking. It begins with one single, automated element; level two adds more features until, at level three, the driver (in BBVA’s case the account holder) can be hands-free for periods of time. Level five automation has a steering wheel that’s merely optional – this is where banking is completely invisible; fully realising BBVA’s ambition for it to be intuitive, smart and fully customised. Autonomous driving is an example of car makers seeking to capitalise on disruption within their sector to help their customers make decisions in the future. Ditto digital banking. BBVA’s key principle for building a digital business is to make every product and service available in such a way that it can be done ‘above the glass’, as White puts it, by any customer. “The future operating model for any company, regardless of industry, regardless of vertical, regardless of the size of the company, is one human above the glass making decisions,” he says.
The power of data This is where customer interaction and data can prove revolutionary, says White. While the average banking customer visits his/her branch around 10 times a year, they visit the banking application on their mobile device more than 300 times, he points out. Overall, they complete more than 3,000 to 5,000 interactions per
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annum in such digital ecosystems, where there are multiple functions, such as chat, social media, entertainment and gaming. The ‘distributed nature of human behaviour’ these are encouraging is having a similar impact on society to blockchain's on technology, believes White. He cites the example of his sons having ‘distributed social interaction’ with their friends through a screen; the equivalent in his day of playing football with friends on the front lawn. “Sit that interaction model across a distributed technology model – that’s fascinating,” says White. Consumers are increasingly interacting in a range of digital ecosystems, where traditional industry lines no longer exist. From such interactions, one can glean
First you make interactions smart. It’s then about making them autonomous – to a point where customers don’t even have to make decisions about their money data. The banking industry has long talked about creating ‘data lakes’, but having data and not actioning it is useless, says White. This is where emerging technology like artificial intelligence (AI) becomes vital. AI and machine learning can translate data into interaction, personalising each and helping customers make decisions that are not purely transactional. “The power of AI is in changing the way people make decisions about their money in a digital world,” says White. He believes the bridge between digital ecosystems will be payments because they facilitate movement both within an ecosystem as well as in and out of it. And if payment technology drives our financial decisions, White sees banks as the engine. In the financial industry, the big tech world tends to consist of high-frequency, low-value interactions. Meanwhile, the banking industry is largely made up of low-frequency, high-value ones. But these ecosystems are beginning to converge,
White says. Big banks, with tens of millions of customers, are seeking to move upstream into where an increased number of digital interactions are happening, while big tech is looking to move downstream into higher-value transactions. “Where they converge, and who wins in the future, will partly be decided by human behaviour,” says White, the other crucial factors being regulation, currencies and who controls them, alongside fiat versus crypto.
Banking on trust Despite big tech leading the revolution in terms of payments, one advantage banks still have is the trust of customers, particularly when it comes to moving money. It takes a large degree of trust for someone to push a digital button and have the confidence that their hard-earned cash will be sent safely to somebody else, White points out. To get them to push more of those digital buttons, it is vital to create experiences that are ‘as human as possible around how people make decisions’. This can be done by using their data in a humanised way and leveraging tech to help, says White. “We also, of course, are helping to build trust in the physical environment, whether customers are visiting an ATM, a call centre, or one of our branches. But, increasingly, the traffic is in the digital world.” The principles are the same for both individual and corporate customers, he adds – individuals making decisions about their own money and those making decisions about their company’s money both demand personalised products and services. BBVA’s ambition is make sure they are available to every customer above the glass. “First you make those interactions smart, it’s then about starting to make them autonomous," he says, “to a point where customers don’t even have to make decisions about their money, whether to buy something for instance, because there are rules that are defined by the user themselves in an environment that they trust implicitly.” And that’s driverless banking.
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