"Data will let us tailor our financial advice and product recommendations to each individual customer"

Question: How do you think the banking sector is doing in Spain, and globally, at the moment, and are banks becoming trusted advisors to people around their money and their data?

Answer: I think banks are trusted, in a way, but we still have a way to go if we are to do everything that we believe we can do to support people.

Q: What do you mean? 

R: Well, take BBVA’s stated ambition to bring the age of opportunity to everyone. At the moment I think banks - good banks like BBVA at least - are trusted to protect people’s financial assets and to keep their data secure.

To bring that age of opportunity to everyone, we have to be more involved in their lives - we have to be proactively looking at each customer’s needs, challenges, hopes, dreams - all of it, and helping them achieve that. At the moment, honestly, I’d say banks are not always trusted when it comes to offering each customer exactly the right product every time, or being transparent and always competitive on things like pricing. Now, part of that is about not fully understanding the customer and part of it is simply about offering generic products and services.

This, though, is where we are looking to change things. All the work we are doing with - for example - the launch of the AI Factory, our integrated design teams and the leading role data scientists and the behavioural economists play within the business - this is all focused on being able to increasingly personalise the products and services we offer people and corporations.

But equally, perhaps more important here, is the advisory role we can play. It’s not just using their data to recommend them the right product, data will let us tailor our financial advice recommendations to each individual customer. So, if a customer is falling into debt at the end of every month, how can we help them? Right now with Bconomy we can alert people to the fact that they are going to be short of money at the end of the month for the expenses we expect them to have - based on their historic transactions. And we can increasingly offer them basic advice - move money from a savings account, ask for a pay advance, etc.

"All the work we are doing is focused on being able to increasingly personalise the products and services we offer people and corporations."

However its the next step that is coming that’s really interesting. That's the bit where we start offering specific solutions - for example, based on your current weekly shop, by moving from this supermarket to that supermarket, you could save X euros every month. Or looking at things like utility bills or insurance - anywhere where we can use machine learning tools to examine the customers data, and against data from other people, shops, providers - whatever - and make an actionable insight that supports the customer to make the most of their money and their data together.

Q: So how far off is this?

A: It's getting closer, but there are still a number of things that have to happen for it to become a reality.

For a start we need to do the insight element in stages. We have spent the last few years building the basic tools to provide the insights - the data examining bit. And those elements are already coming into play in tools like Bconomy. This aspect is about empowering the customers to change their behaviour through a deeper understanding of their financial lives.

Feeding in the other data requires a few more challenges - one of which is simply getting the free flowing data from third parties that will support this. Here, as our executive chairman wrote about a few weeks back - regulators could play a key role in supporting a level playing field and promoting customer-data ownership.

But there's another element too - time and trust. The end game here is the self-driving bank account. Autopilot for your finances. But that’s - in the context of self-driving cars - level five. So to get from level two where we are, to level five where the bank not just alerts you to opportunities or problems, but finds solutions, proactively proposes them to you and actions them for you. That needs trust and that comes from us proving we always work in the customers interest over time.

One example, already live, of where we sync together customer data and third party data is Valora. Valora can give specific insights for the customers on a house they are thinking of buying. But actually it can do more - it can tell you whether a better move might be to rent a property rather than buy it. Clearly there's less value for the bank in people renting, but that’s not the point - the point is to help the customer make the right decision.

Q: So, data driven AI is going to continue to make a big impact in banking, but what other technologies are you watching and why?

A: I think two things regarding technology. If we talk about technology today, that is disrupting the industry already, then I would highlight mobile and data. These are the ones that are already changing the ways in which people bank, where and how they bank, and really who they bank with. Also because of the frequency of interactions, which is a game changer.

"The AI powered systems we have coming down the pipeline in this area will be a game-changer for customers - being able to have a conversation with your bank account"

And data because of all the things we mentioned just now about advice, and data is at its core. These two are already our reality.

As for what’s next - I don’t foresee massive disruption in the next couple of years - but blockchain for example is becoming an increasing useful and viable tool. BBVA has already completed deals in the corporate world with blockchain based products. When it comes to retail, its slightly different, as the long negotiation process is not the primary need. But there is definitely a role blockchain could play in things like identity and in sharing sensitive data. This could be extended into areas like zero-knowledge data sharing - where no actual sensitive data is shared but just confirmation through token exchange that someone’s data meets the requirements of the other party.

I think voice interaction services will grow too - and especially areas like smart assistance - enabling people to talk to their bank in everyday language to get things done, find things out or ask for advice or specific products. Again it's about giving the best customer experience in the right way - the way that best suits each customer. The AI powered systems we have coming down the pipeline in this area will be a game-changer for customers - being able to have a conversation with your bank account, where you don't just get numbers told to you, you get specific advice that will allow you to make better decisions, whether that is buying something, saving something, investing something, changing something in your behaviour, to just ensuring that the aims you have in life are on track.

That for me is the real future of banking - shifting from operating around transactions to operating around the best customer experience, from advice to personalized proactive offers to helping people navigate through the increasingly complicated digital world and all it can offer.