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Marc Torrens, CIO and Co-Founder of Strands, explains at the Digital Transformation in the Financial Sector - 4YFN Programme how to innovate in the financial sector and how they are doing so at Strands, by providing solutions for banks around the world.
Has Disruption Already Reached the Financial Sector?
The answer, according to Marc Torrens, is "not yet".The financial sector is currently immersed in Digital Transformation, applying the new digital channels to its business, but the business model itself has not changed.Offices have undergone a significant transformation: first the online model and then, the mobile model; however, the business model remains the same.There has not been the disruption that other sectors have experienced.
Let’s consider, for example, music: the music business model has undergone a complete transformation. Marc Torrens states that real disruption in banking is yet to come and consists of creating user-centric processes.Offering customers what they really need at all times, instead of a catalogue of products.
In the future, banks will move from providing financial services to providing solutions.Proof of this is the arrival of new agents on the financial scene: large digital companies and fintech startups that are beginning to play an increasingly important role.
What Differentiates Banks from Fintech Companies or Large Digital Companies?
Data. The bank collects users’ day-to-day data over a period of decades.Unlike companies like Google, which collect data referring to users’ intentions, the bank collects real data.It knows what users have bought, and not what they intended to buy.
"Banks are losing their monopoly on banking.(…) The good news is that we still have one significant advantage, which is the vast array of financial and non-financial data that we accumulate”.
Francisco González, CEO, BBVA
From Product Catalogues to Customised Services
A bank knows when users bought their last car, when they use it, what kind of family they have, what their needs are, so it can also know if they need a new one and which one would suit them best.Real disruption in the banking sector is transforming all this data into knowledge so as to offer a valuable service to the user.
This may be easy to say, but hard to do.It is very complicated to have a single data repository which accumulates a customer’s information, and all the more taking into account, for instance, bank mergers.
Strands:Innovating in the Financial Sector
Marc Torrens' company is a leader in innovation. Strands are experts in Big Data, Machine Learning and UX.This means that its strength is processing (with Machine Learning) the data (Big Data) to provide the best possible user experience (UX).Today, Strands is present in 36 countries and more than 100 million users already use its products. Barclays, BBVA and ING are prominent customers.
Its challenge is to offer solutions so that banks can respond to this new way of doing banking.Among these solutions is "What if", a service that helps customers take financial decisions.The customer can ask if they can afford to buy shoes or not, depending on what they have spent that month and their savings goals.
Another of the many solutions provided is CLO (Card Linked Offers), already implemented in a Swiss bank with very good results.A marketplace between small merchants and end customers where we can see, through the bank's data, which customers are more likely to make a purchase.
These and many other solutions are still being developed on Strands under the guidance of our expert Marc Torrens; even though Digital Transformation is already here, disruption in the financial sector has not arrived yet, and much remains to be done.At GoingDigital, we want to support you on the road to innovation.