The president of the Spanish Banking Association (AEB), José María Roldán, has defended today the opportunities offered to the banking sector by the «fintech» – companies that provide financial services through technology – that, in their opinion, are allowing entities to "learn a lot from them" in aspects such as user experience. However, his assessment of the «Bigtech» -Great technology companies that operate in the financial services sector such as Google, Amazon, Facebook or Apple- have been less positive, considering that they have a "different DNA" and that they are based "on the exploitation of the data, many in a way that is not transparent to the client»
During his speech at the EduFin Summit 2019, held this Friday in Madrid, Roldán said that these great technologies are a "problem for the sector and the authorities from the point of view of regulation and financial stability". It has nuanced, though, that "every time I see a challenge for the authorities more than for the banking sector itself."
The head of the AEB has insisted that banks already have the confidence of their customers and that, therefore, the goal should be to maintain it, strengthening its strengths. "Technically, We have the ability to guarantee the confidentiality and integrity of our clients' data», He pointed out.
Roldán has also reflected on the benefits and threats of "robo-advisor", that is, a financial adviser who provides advice and online portfolio management using algorithms with minimal human intervention: «From the point of view of costs for the client and of margins for the entity, allows to be in a "win-win" situation» He also defended that "this technology should not be renounced" because it would be to the "future of financial services": "It allows making a suit tailored to the price of a garment suit. It is tremendously powerful, "he concluded.
On the dangers that the "robo-advisor" carries, he has warned that it is advisable to be "very attentive" to the final result because "it can be so complex that you do not know very well why it has come out". "We have to be aware as an industry that those new technical capabilities can have a dark element that we have to be able to control », warned the president of the AEB.
In a context of continuous changes and growing importance of new technologies, also in the banking sector, Roldán has spoken about the role that financial education must play, which he has described as "fundamental" in the achievement of a "more solid in the medium term ».
However, the immediacy provided by the digital environment also entails problems and one of the ones highlighted by Roldán has been the risk of users making decisions that have not meditated enough or that they can be victims of cybercrime, although with regard to the latter it has ensured that the bank is "very well positioned" to be able to give guarantees to customers "increasingly demanding and who are intolerant to the unavailability of services".
The president of BBVA, Carlos Torres, has also participated in the second day of the EduFin Summit 2019, with an intervention focused on the importance of financial education and the challenges of the new digital era. "Preserving the fundamental right to privacy is going to be one of the biggest challenges we are going to have as a society," said the bank's chief executive.
His statements occur in the middle of the Controversy over the alleged illegal eavesdropping by former Commissioner Villarejo to politicians, authorities, businessmen and journalists commissioned by BBVA, which is investigating the National Court.
The banker has lamented that Financial knowledge among the general population is "low", which leads to "a lot of frustration and stress" because people "make decisions that, far from optimizing their financial health, cause problems in their lives or in their businesses".
The president of the Spanish entity added that "it is not only due to lack of knowledge, but often there is not even awareness of the implications that the decisions we make have on our future life", as in the case of consumption. "It is always more tempting than saving because it has immediate gratification and it is very difficult to be aware that the saving, for example for the entrance of a house, has to be built with small sacrifices every day», He pointed.
In this line, he said that if "we are able to provide people with a better financial education we will be giving them a tool that can be key to achieving their business and life goals". On the technological revolution we are experiencing has shown that "it is an unprecedented catalyst" and an "opportunity to accompany clients at times of day when they are making decisions about their finances."
Financial lack of knowledge
The Governor of the Bank of Spain, Pablo Hernández de Cos, was another of the speakers at this edition of the Edu Fin Summit, an event in which he warned that a very large group of Spaniards is not familiar with basic financial concepts.
According to the Financial Competences Survey prepared by the banking supervisor and the National Securities Market Commission (CNMV), 42% of Spaniards do not know what inflation is, 51% do not understand the idea of risk diversification and 54% do not know the concept of compound interest rate. In addition, only one in eight people between 18 and 34 years old is able to answer correctly when asked about these three terms.
"Improving financial education has obvious repercussions on social welfare as a whole and is also very important for financial institutions themselves because it allows them to improve their reputation," he said.
. (tagsToTranslate) roldan (t) bigtech