Fintechs have managed to put Spain in 6th place in the world for the number of fintech companies. The main benefits include more personalised service, speed, agility and greater financial inclusion
The rise of fintechs has caused a radical shift in the financial paradigm, and consumers are now much more active
Fintechs in Spain have managed to gain ground and put the country in 6th place in the world for the number of companies in the sector. In the new financial ecosystem where the customer is mostly digital and very active, traditional financial institutions no longer see fintechs as a threat and now prefer to collaborate instead. These collaborations have led to greater stability, a wider range of products and increased knowledge about the customer. Furthermore, fintechs are also able to offer richer data, an improved user experience and more modern platforms.
Together, fintechs and digital banks are able to offer a positive experience to their customers. Their cooperation is key to strengthening the current financial sector by improving efficiency and profits, generating new business opportunities, improving the customer experience and increasing customer loyalty. In fact, in 2021, the fintech sector stood out for its high growth and investment figures. In 2022, it is predicted that the sector will continue to grow, set new trends and generate new opportunities to establish new partnerships and reduce risk. At the same time, it will open the door to greater centralisation of services around a digital architecture that will put fintechs at the very heart of the industry.
But fintechs are not just a good thing for traditional financial institutions; they also have many benefits for customers. According to GDS Modellica, the main benefits for consumers include:
Personalised service: they offer specific financial products and services adapted to the needs of the customer.
Convenience and speed: they are able to offer real-time, 24-hour services every day of the year.
Easy access to efficient, agile and simple paperless operations without having to leave the house.
Technology that can guarantee the veracity and security of transactions from any device.
Financial inclusion and democratisation of access to financial products: access to financial products does not have to be in person and can be digital, thereby improving financial inclusion.
Transparency and fewer fees.
New products and services, whether it is mobile payments, automated advice, access to credit through a participating platform, etc.
The rise of fintechs has caused a radical shift in the financial paradigm. Consumers are no longer passive and now have expectations. If they are not convinced, they can change provider with relative ease. According to the recent World Retail Banking Report 2022 (WRBR) by Capgemini and Efma, “75% of customers surveyed are attracted to Fintech’s cost-effective and seamless services, significantly raising their digital banking expectations.”. However, according to their study, “it is critical banks better leverage data and Artificial Intelligence to tailor the experience, create stronger connections and maximise customer value” because today, customers are “able to switch providers at the tap of a screen”.
In the current financial ecosystem that demands increasingly faster services, being able to identify, assess and prevent potential risks or vulnerabilities is a top priority. For fintechs, strong cybersecurity is an absolute must when it comes to communication, transparency and instilling confidence in customers when managing their finances. The success of fintechs is largely due to the fact that they are much more than just payment platforms. They offer automated processes and a wide range of tailored products and services that improve the customer experience. However, those customers are not immune from the inherent risks of financial crime. According to García Rouco, managing director at GDS Modellica, “ a permanent and continuing challenge for fintechs will be to guarantee security, and always being prepared for the potential risks is the best form of defence.”
On the 16th and 17th of November, Madrid hosted the 14th National Credit Congress, organised by CMS Group and attended by more than 1,000 people to discuss the latest challenges and innovations in the industry.