role of the regulator has increased, although
political instability in recent times has
slowed down the changes. However, AEFI
has been working with the regulator and
supervisor for the approval of a Sandbox
within the law of digital transformation of
the financial services sector. The Spanish
cabinet has approved a draft bill that
includes the creation of the Sandbox. This
is expected to speed up the development
of fintechs in general and creation of
innovative ideas in both the finance and
the insurance sectors.
DIGITAL DISRUPTION
In spite of the constraints, the fintech
sector has come up as a leader in the
digital disruption of the financial services
industry in the country, as a growing
number of startups have developed
innovative solutions without bank licenses.
The ecosystem as a whole is reported to
have grown by 41% in the last 15 months.
Some of the startups that have come up in
the last 15 months are those in insurance,
crowdfunding, financial management,
wealth management, corporate lending and
payments. According to FinTech Global,
Spanish companies have raised over $
million in 2017 across 19 deals, which is a
10x increase in comparison to raised capital
in 2016. This was driven by larger and later
stage equity funding for companies in
the sector.
BETTER DAYS AHEAD
The number of digital payment users in
Spain has been steadily growing, increasing
from 23 million users in 2015 to 27 million
in 2018. This number is expected to grow
to roughly 30 million in 2021 in the area
of digital commerce. According to the EY
FinTech Adoption Index 2017, Spain has
an above average position with respect to
the percentage of fintech users, obtaining
the 6th position in a study that included the
analysis of 20 markets overall. Over 37% of
the internet users in Spain has used digitally
enhanced financial services at least once,
mainly for managing their finances, buying
products online, or making transferences
via their mobile apps.
Recent studies have shown that the
majority of fintech startups operate under a
B2B model (over 52%), while 48% of them
sell their services to the end consumer.
Taking into account both B2B and B2C
companies, 76% of them charge for their
solutions, 21% provide services for free,
and only 3% work with a freemium (mixed)
model. It is also observed that the market
is experiencing growth not only in terms of
companies that develop fintech solutions,
but also in the number of users adopting
new services to manage their finances.
While the country may still be at a nascent
stage compared to leaders like the US, UK
or China, innovation seems to have got into
the minds of Spanish entrepreneurs and the
only way it up.TRUE DISRUPTORS
While Spanish banks like BBVA and
Santander are making huge investments in
new technologies, there has also been a spurt
in number of challenger banks. With the right
financial support, these fintech endeavors are
disrupting the traditional banking models.
Some of these enterprises are:
2Gether Global is a collaborative
banking platform app, which offers 2GT
token. Users need to hold a minimum of € 10
worth of 2GT to access the services and they
get rewarded for their contribution in 2GT.
Bnc10 is mobile-focused banking
service, offering chat banking and
WhatsApp banking through its app. It
does not have its own banking license but
is relying on a license of an undisclosed
established bank.
Bnext is a digital and mobile bank
that follows UK’s Monzo. It has attractedfunding of €1.5 million with the aim of
reaching 100,000 active customers.
EVO Banco of Madrid offers ‘The
Smart Account’, a mobile app, which also
has a smart voice assistant. It has attracted
the young generation of customers.
Ferratum Bank is Germany-based
but came to Spain. It uses behavioral data
analysis to generate intelligent, real-time
and targeted recommendations to improve
customer experience and add services over
time according to users’ preferences.
imaginBank is a mobile-only bank
that uses social media to connect with
customers. It is part of Caixabank, one of
the largest banks in Spain. The core product
is the imaginBank current account.
Ipagoo is not technically a bank, but
covers all the EU and beyond, offering
current/business accounts and cash
management services. It plans to open its
APIs to become a Bank-as-a-Service (BaaS)
company to anyone willing to develop new
interfaces or applications.
Nomo Banking is a digital banking
service catering for freelancers and the
self-employed. It is part of Banco Sabadell,
and offers a mobile app for round-the-clock
working hours, automatic accounting and
tax management.
Openbank is a subsidiary of Santander
and targets the professionals with current
accounts, savings, investment/wealth
management and lending products
(including mortgages), debit and credit
cards. The bank has over one million clients
and €6 billion in deposits.
[email protected]The founding team of Kueski, the online microloan provider