BBVA: Reinventing Banking as a Digital Business
BBVA is Spain’s second largest bank and an innovative global financial group that provides financial services in more than 30 countries to 72 million customers, of which SMEs is a very important client segment. In recent years, the bank has reinvented itself as a digital business, and it aims to be as nimble as a fintech.
BBVA is recognized within the industry for being more pro-technology than many of its competitors. The bank is investing in technology, and both acquiring and allying with fintechs. Under Chief executive Francisco González, BBVA started early. It began overhauling its computing systems in 2007. Since then, BBVA has bought fintechs, a digital design company, digital banks in America and Finland, and a stake in a British online bank, and it invests in young fintechs. But it also has a capable in-house design team and a “tech-savvy” culture.
BBVA is using that “tech-savviness” for and with SMEs, leveraging new technologies and collaborating with the start-up ecosystem. One example is Commerce 360, in which BBVA uses credit card payments data to help retail businesses in Spain to take informed decisions, understand their clients buying patterns, and compare their sales with their competitors. Another example is Azlo, a start-up in which BBVA invests, that helps entrepreneurs in the U.S. to run their business through a digital account: to make national and international payments, pay their bills, and integrate with their e-commerce and PoS solutions. “At BBVA, our aim is to bring the age of opportunity to everyone, and we think that by providing digital solutions, we help our clients to make decisions for their business in the most convenient way.” Ignacio López-Perea Páramo, Global Head of Distribution Models for Corporate and Commercial Banking, BBVA.
Since access to finance is one of the main concerns for SMEs, in Spain BBVA launched Click&pay working capital loans, a short term line of credit for paying payrolls, suppliers, taxes or imports that can be accessible online with one click. Once the line of credit is authorized, the client can use that line anytime, anywhere, from the website or the app. More than 65,000 SMEs and entrepreneurs have signed up for a Click&pay credit line since its launch in April 2016 and as of March 2018, 80% of the disbursements were made online. Similar solutions have been developed in Mexico, Colombia and Peru.
BBVA Group joined the SME Finance Forum last year. Garanti Bank, its bank in Turkey, had joined two years before. BBVA wanted to tap into the Forum’s ecosystem for SMEs, to improve financing and innovation for small businesses, especially in emerging economies.
“We have been able to attend very interesting webinars and events organized by the SME Finance Forum, and especially access and connect with the network of fintechs, banks, regulators, and other very interesting members of this great initiative,” says Páramo.
“Banks are not going to be banks in the future, they will be service providers, they will be platforms for financial and non-financial services.” Francisco González, Group Executive Chairman, BBVA.
At the SME Finance Forum annual event in Berlin, BBVA presented its Open Talent Competition at a gala dinner. The competition, now in its tenth year, looks for the best fintech ideas that will shape the future of banking and gives them a chance to grow their business with BBVA. Ultimately, the bank seeks to ensure that technology works as a catalyst for positive change in an environment where industry lines are blurring.
BBVA’s membership with the SME Finance Forum has strengthen their knowledge of the SME finance space and the collaboration with other financial institutions who seek to accelerate finance to SMEs.