BBVA API Market
Digitization processes have found their way into almost every sector: new production lines, complete automation of processes, improvements in user experience… The digital era provides an opportunity to change how national industries work, and technology is the basis for their growth. As a result, sectors such as retail have embraced e-commerce as a way to meet the increasingly changing needs of consumers, and they are transforming faster than ever.
However, barriers remain in some sectors. The paradigmatic example is the automotive sector, an industry that accounts for around 10% of Spain’s GDP but that, until now, has not managed to catch up to other industries in terms of digital transformation.
It is precisely in this context where we can see a clear example of how banking APIs can play a role in this digital transformation to provide real value and improve the customer experience. The final frontier is the purchasing process, probably the most critical moment in the entire flow, and where APIs can offer the most added value.
Changing market conditions are forcing companies to invest in new technology to adapt to said conditions and to the new needs of users, and especially to support the rising trend in e-commerce that we mentioned earlier.
This also requires companies to have more and more channels and that customer relations be carried out through all of them, not just in physical stores. This omnichannel process, however, has not consolidated in the automotive sector (at least not as fast as it has in other sectors), one in which, due to its special characteristics, a physical presence is still required as part of the car purchase process.
This is, in fact, one of the last barriers that this important industry must break down in order to grow, especially in an increasingly interconnected world where tablets, smartphones, social media and instant messaging apps are part of our day-to-day lives.
A recent MotorK study highlights the importance of new technologies in the purchasing process. 62% of all car purchases in Europe start with a smartphone, a figure that will increase to 86% over the next three years. What’s more, 28.7% of all online car information and price requests that were processed in under 10 minutes resulted in a sale.
Despite this, European dealerships are still not fully prepared for this digital transition. More than half of official dealership websites lack basic features, and 54% don’t even list their new or semi-new vehicles in stock.
This reality is particularly negative in every area involving the purchasing process. Not digitizing means losing potential customers, and a fast response becomes an indispensable ally for distributors.
The digitization process has been especially fast to catch on since the opening of banking APIs, thanks to the regulatory push from European governments through the implementation of the PSD2 law. In recent years, numerous initiatives have emerged that can be applied to any industry, especially in areas related to managing payments and the retail sector. The automotive sector, due to its special characteristics, can benefit from all its potentialby accessing a customer’s banking information instantly to offer the product that best suits the customer’s needs and characteristics.
It is important to note that the vehicle purchasing process is one of the few that almost always involves financing. However, the loan application process is sometimes slow and it doesn’t always adapt to the customer’s needs. This has a direct impact on the purchase, since without appropriate and feasible financing, the customer will opt out of buying the vehicle.
APIs speed up this process and adjust to the purchasing process. Thanks to them, any application, whether the brand’s or a third party’s, can integrate a solution to facilitate the loan application process for the dealership’s customers. The dealership offers tailor-made financing in a simple and integrated way by instantly accessing the offers made by the bank, and it can offer a pre-approved loan based on the credit rating and conditions of the customer requesting it.
One of the APIs that can help the most in this process is BBVA’s API Auto Loan, which can inform users if customers have a pre-approved loan with BBVA and what its conditions are. Thanks to this API, any service can integrate personalized financing into the purchasing process and make available to the user all the relevant data on their loans, such as the limits, amounts, terms and fees.
The advantages of integrating this type of API into the purchasing process are obvious to everyone involved. This is an essential service that rounds out the catalog of features offered by any dealership or distributor.
In short, APIs have become an ally in the digital transformation of companies and industries, and the automotive industry is one that can best take advantage of its full potential. The road ahead is still very long, and the benefits are significant for every stakeholder in this industry.
Taking a customer through the entire buying process until it is formalized is an arduous journey and one that faces the constant possibility of the customer leaving. However, there are ways to make the buying decision happen if you are given facilities such as agile, secure financing.
Open banking is driving the development of new apps that are integrated into company platforms, all in an effort to offer banking services to customers. Thanks to APIs, any banking operation, such as opening an account, can be done without the need to exit an application.