Julio César Fernández, Director of Business Development and Operations Support for Technology Services at Cecabank.
The way in which citizens execute payments and monetary transactions has evolved enormously over the last decade, and more acutely since the outbreak of the pandemic. Mobile phones have accelerated this change and have become an essential payment instrument, either for the payment itself by tokenising our cards and accounts or for securing the payments we make.
Data seem to support this unstoppable trend. According to the 2021 Global Findex Database, two-thirds of adults around the world currently make or receive digital payments.
The Funcas Report on Financial digitalisation after the pandemic, what has changed?, published in April 2022, shows that 69.1% of purchases are made using non-cash means of payment; three out of four respondents use Bizum.
Bizum, with 20 million users, has become a standard for person-to-person payments in our country and is a paradigm of this change. It now intends to extend this success to other payment scenarios such as e-commerce.
In July this year, N26, with Cecabank as its processing partner, launched the Bizum service for its customers. Prior to this, Cecabank had already assisted a mobile bank such as Orange Bank to embark on this same path. These developments indicate that Bizum has become a payment standard in Spain, and no bank can expect to compete in the person-to-person payments market without offering this functionality to its customers. For those banks that portray themselves as innovative or disruptive, especially in younger segments of the population, not offering Bizum is no longer an option.
At Cecabank, in our role as a wholesale processing bank and as a one-stop shop for payments for the financial sector, so far this year we have processed more than 1,100 million card transactions issued by financial institutions and more than 92 million Bizum transactions, with double-digit growth since the pandemic.
What Bizum or other payment methods such as Apple Pay demonstrate is that to be successful in today's world of digital payments you have to: provide value to the customer from the outset; usability must be completely frictionless; and a network effect must be achieved, that is, it must be immediately available to a large number of customers from the outset. In this manner, the apostolate of the service is performed by the users themselves, who perceive its advantages.
The coming years will see a battle of systems and solutions that will define the customer's preferred digital payment method. It won't be like the famous film The Immortals, where "there can be only one", but there will no doubt be many who fall by the wayside.
