BBVA API Market
Just over 10 years ago, the digital companies that have become giants today were the first to open their APIs to third parties. Any great businessman from the last century would have torn his hair out if his company had clearly shown a lot of its inside workings to other companies, but behind that decision to share information underlies a complete change in mentality: companies like Twitter, Facebook or Foursquare sought to create an ecosystem of services and products around their own offering, thus reinforcing their appeal and reach even at the cost of creating new businesses that other capitalize on.
Now that strategy, assumed as the basic paradigm of the digital economy, is already a reality in the most dynamic banks, which operate in a sector with very marked peculiarities, such as its systemic nature and its strict international regulation.
On June 20 BBVA organized the Fintech University in its Innovation Center in Madrid. This was a full day intended to share experiences and knowledge about the digital revolution in finance in which there is great talk, and a lot at that, about APIs. Four Spanish startups in this sector shared their experiences with APIs, key to the development of their business.
Despite his youth, José Luis San Julián has already had an extensive career in creating and developing digital companies specializing in apps. His team’s latest project is Chances, which is an application that graphically defines: “We put the analytical capacity of large companies in an entrepreneur’s pocket, transforming it into a simple market study”.
The basis of everything are APIs, the open information of which is mixed and distilled for the app’s users in a business model that is currently free of charge, in search of volume, but will be fee-based in different layers and levels according to the degree of sophistication of the data.
Evidently the app would not be feasible without APIs
“An API does not stop being a source of data of a third party, which it lets you access for you to use its information. Our added value is that we can access a lot of data sources that generate a large volume of information that is as valuable as it is unwieldy. We break it down to the millimeter, and offer an extremely chewed up version.”
The application of big data to improve business management is the key to GeoBlink. It is, explained one of its creators, Jaime Sánchez Laulhé, an application aimed at companies with a network of outlets: thanks to GeoBlink they can get to know in detail how each of these points performs, which is affecting their results, where to open new stores and geotag their direct marketing campaigns. Everything is based on open source software, such as Angular (developed by Google), Node, Postgresql and Mongo.
APIs are also crucial in the Bankast model. This company was created in Valencia and is led by Carlos Castellanos offering immediate payments between current accounts, 24 hours a day, seven days a week. “The connection to a bank, understood as a payment service provider and an account manager, is much more robust through an API”.
In this regard, he added: “We’re not talking about security, that also, but, above all, about availability and speed, which is very important to the user. If we have an API, the process is much more robust and scalable: In other words, people may use their current accounts to pay in many more cases. It’s the best tool that you could have,” Castellanos explained.
The user wins in the end, and that’s the most important thing, but the advantages for the company that uses third-party APIs are also evident. Anfix, an online management platform for SMEs and the self-employed, is a good example, as one of its sponsors Miriam Bailón explained at the Fintech University: “We have a great product, but we cannot develop all its aspects. What could be better than allying with someone who is specialized in providing such services, to provide the best possible service to our customers? I cannot spend time and money in obtaining information, and moreover very good information, that others give me such as BBVA Open APIs.”
Another computing concept that is much more common, cloud computing, is basic to Anfix because all the information of its users is stored in the cloud: “it’s not enough to simply make a back up, as many mid-sized companies believe. Cloud-based data are much more secure,” Bailón maintained.
Sanjulián highlighted the increased security offered by APIs: “APIs also function as a series of layers of security, and in fact it’s easier to distort data through a credit card, which does not stop being a piece of plastic, than in a computing communication which is very much encrypted.”
In the era of open platforms, the most necessary change may be in mindset
The creator of Chances understands a certain reticence, but it should be remembered that “there were also some people who didn’t trust credit cards.” In the era of open platforms, the most necessary change may be in mindset: beyond technological advances, the key is that now large enterprises and startups must work together in a relationship in which everyone wins. Only those who are able to understand this will lead the fintech revolution.
More information about ‘Fintech U’:
Various case studies are used to show how open finance enables the financial inclusion of SMEs and the economic growth of developing regions.