Banking Industry: The (Great) Threat of GAFA
Some very large, enormous GAFAs cloud the vision of the future of the banking industry. Google, Amazon, Facebook and Apple (GAFA) are going to enter (yes or yes) in the business of financial transactions, Therefore, traditional banking could lose 30% of its business by 2020, as reflected in the Banking 2020 report, carried out by Accenture.
The irruption of the technological giants to financial services becomes a significant risk that can erode the income of banks, especially in commissions. “For the client, it may mean a greater offer of services, with increasingly competitive groves,” explains Roberto Gomes, executive director of EY in the Financial Services division in Central America.
These companies have two key elements when it comes to being successful in consumer loans and payments: data and the relationship with the client.
And something is that it is already happening. Amazon introduced new financial services in India and Mexico. Facebook, and Google have made their way to handle payments in the United Kingdom with products such as pay-by-messenger, which was released in November, and Google Wallet, with which you can send payments by email.
And they are not the only ones. Big technologies are attacking big markets. In China, WeChat (which began as a platform similar to WhatsApp), has been incorporating services and its payment system WeChat Pay it is widely used.
antfinancial, Fintech created by the founder of Alibaba, “not only does Alypay dominate more than 50% of mobile payments in China, but it also competes in the financial sector through a bank, an insurer and an investment fund, and even tried to buy Moneygram is one of the most important traditional players in the world of remittances, but it was blocked by the US ”, comments the EY expert.
Facebook today has the capacity to analyze 150 million credits per hour, simultaneously, thanks to the knowledge of the user, and its predictability. What does this represent? That banks have to see it in their business model and develop a lot of response capacity. No bank in the world has the capacity to grant a loan in one hour to 150 million people.
The entry into play of the GAFA "It is a situation that must be examined by traditional banks", points out Juan Carlos Arcila, president of the Latin American Congress of Digital Banking, who also points out their empathy with the public, in the face of the bad image of financial institutions.