And I have to go to the branch? This is the question that a young person will immediately ask when they have the opportunity to open a bank account. New customers have massively adopted the smartphone in their lives. Outside and inside the house: always connected. Through it, they relate to people and their environment.
The financial world does not escape from this new customer model
They make their purchases, comparing products and services, prices, and knowing the experience that others have had. The financial world does not escape from this new customer model: they will also want to solve every need they have in this field. They would not have any qualms about asking their mortgage to Facebook or leaving Amazon the purchase they have made. Banking has ceased to be a place to which it goes, to become a series of operations that are made.
Reaching the customer and solving their financial problem is key
And in this new way of doing, the competitive advantages of traditional banking are eroded. The great technology companies -Google, Apple, Facebook or Amazon- are ideal candidates to break into force and play an important role. Google already has a banking license, although it still only offers payment services and has different fintechs for loans and crowdfunding. Apple, in addition to Apple Pay, now offers Apple Credit. In short Facebook, which facilitates payments between friends, will delve into more financial plots and Amazon will extend its Amazon Payments platform.
All have money -mass more than 500,000 million in cash and liquid securities
They have the “new gold”, the data, and they have talent and mastery of the latest technologies to get them performance. They also have millions and millions of customers with whom they establish a close, natural relationship. They do not have to make an effort: the client enters voluntarily and many times a day.
But it will not be only them
The telecommunications companies also want their share of the pie. Movistar Money, which offers financial products, has started to work with the collaboration of LaCaixa. Soon Orange Bank will operate in Spain. Hundreds of fintech are specialized in specific segments. And in reality, any website – the one that sells travel or whatever – has the opportunity to “sell” financial products as well. If they do not have their own financial support, they will have it behind their backs.
Is this the end of banks?
Thus, the financial business is becoming an ecosystem where, as in the biological, there will be all kinds of entities, small and large; each with its objectives, its function and focused on a specific niche. And in that ecosystem the traditional bank has to defend its hole. In the Digital Banking Manifesto: “The End of Banks?” the Massachusetts Institute of Technology already warned that it is not enough for them to perfect the current business model: “Banks are trying to be great and build super-cool digital fronts. … But it’s like putting a lipstick on a pig, ultimately it’s still a pig. ” Either they become savvy or their function will be limited to being providers of those that relate to the clients.