The opportunity was unbeatable, but the Spanish 'fintech' have not fully seized it. With the coronavirus, Spanish savers and investors were expected to rush to use neo-banks, 'roboadvisors' and any other type of 'fintech' to the detriment of traditional banks, but this has not been the case. It is recognized by the co-founder and CEO of MiCappital, one of the most important tech fintech ’on the national scene. However, other equally useful conclusions have been drawn from the crisis: "The target audience has shrunk, but has become more aggressive in its investment needs."
MiCappital's opinion is one of the most valued among the Spanish 'fintech' sector since it won the BBVA Open Talent in 2017. After two and a half months of confinement by the Covid-19, its top manager looks back to weigh what he has learned. “We have generated more content and have been much more on top of customers. When the client is more advised, he usually makes fewer mistakes ”, reveals Miguel Carmiña. First lesson of the crisis.
In March, the toughest month for the coronavirus, this online financial advisory firm had no client losses, yet 60% invested more, taking advantage of the sharp falls in the stock market. The advice of the experts was "Not invest everything in one, but in a staggered way", and thanks to this simple guideline, the equity advised by MiCappital, between the revaluation of assets from minimums and new contributions, has shot up 30% compared to the level prior to the state of alarm, up to 22 million euros.
The advisory model of the Madrid 'fintech' is to work on the range of financial products that the banks with which their clients operate have, be it an open or closed architecture. Especially, advise on investment funds for its transparency, taxation, diversification and professional management, but also include pension plans, insurance, deposits or remunerated accounts.
With an average client whose savings amount to 12,000 euros, the firm has three different rates: free for those who want to try, where the only thing that can be accessed is a calculation of the risk profile and a recommended asset allocation; since two euros (custom plan) only the months that the client earns, with a detailed selection of funds or exchange recommendations when the market moves, and a flat rate of 20 euros per month (extended plan) where the investor, in addition to all of the above, meets via Skype with his personal advisor.
The second lesson that those responsible for the pandemic have learned is that they may have to aspire to a smaller piece of the pie, although more committed to your investments. According to an internal study carried out by the firm before the crisis, in Spain there are some 40 million checking accounts without advising, classified as potential customers who lose purchasing power at 0% rates. But the coronavirus has also shaken up these projections. “The target audience has been reduced to 30% of that total. The majority 70% are people with a lot of uncertainty who need liquidity, because they are unemployed or they are in an ERTE. But the 30% who still want to go from saver to investor, are more aware of the need to invest and have become more aggressive in their investment needs. Before, he made decisions in weeks, and now he makes them in minutes. The descent of the bags have made them put the batteries ", justifies Carmiña. They are savers who "want and need advice."
COLLABORATE WITH BANKING, DO NOT COMPETE
And in that advice, banks will rely on third-party players, but they will not disappear, nor will they give up too much ground. Third lesson of the crisis. Carmiña predicts that banks, 'fintech' and technology companies will collaborate in certain parts of the business of the former (such as electronic payments or investment advice), something that already occurs today and is "much more likely" than the theories of some gurus. about whether the second or third will occupy their place.
"Fintech or big technology will have a larger share than the current one, it is obvious, but banks will modify some aspects of how they do their business and relate to customers and, therefore, they will not disappear," he says. the person in charge of MiCappital. What's more, in Spain, the ‘fintech’ are still starting. "Neobanks, which are the best known, many people on the street are not even located. Spaniards have a love-hate relationship with their bank. They don't fully trust the product they offer, but they do value being in a large entity ”, Carmiña acknowledges.
Thus, the future depends on collaboration between sectors, not on direct competition. Also for specialization and innovation, and impact investments will play a relevant role. MiCappital is already studying how to set foot in this niche. “Impact investing, in addition to improving the world, has to be profitable. In entities, it is difficult to find quality products. Many wear the ASG and ISR medal, but the client on many occasions does not earn money or, if he does, he lacks relevant information on the extra-financial metrics, ”criticizes this advisor. In this new step, in MiCappital "We want to be more like a microcredit or sustainable energy start-up" than the "roboadvisor" of a bank that has one or two funds named sustainable. " A future that is already present.
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