Fernando Rodriguez Ferrer (1983, Madrid) is the Bizum Business Development Director, a money transfer system between individuals, an alternative to bank transfers. Bizum emerged as a digitalization and collaboration project for the Spanish banking system with the aim of creating a universal, simple, immediate and secure method of payment via mobile phone, first between individuals and later extending the service to e-commerce payments and , later, face-to-face commerce. To find out more about this project, we talked to Fernando Rodríguez Ferrer, its director of development, who will tell us about the changes in the online payment sector, benefits and users of Bizum, future projects, among other topics of interest.
You have been working at Bizum for 5 years. Since then we have experienced the popularization of eCommerce, the use of mobile phones, the loss of the fear of paying digitally… How has the online payment sector changed since then? How do you remember your beginnings?
In recent years, the way of making payments has changed significantly, especially in the case of mobile payments, which have become part of the day-to-day life of many Spaniards.
The launch of Bizum in 2016 marked the entry of a payment solution between people without the need to use cash (a need not yet satisfied with a universal solution). And this, betting on an instant payment solution from account to account, which allowed payments between individuals to be made in a simple, comfortable, secure way and regardless of the user’s bank. Quite a novelty.
And the users were testing and adopting Bizum, but not only that. They were (and are) our greatest prescribers, the true speakers for the extension of the service. And it was surely so because Bizum came to satisfy a real need of the population and facilitate their day to day life. So much so that today “make a Bizum” is part of the everyday language of many Spaniards, also in payments in electronic commerce and physical commerce, functionalities that came later.
Has the pandemic benefited the use of this payment method?
The great boom experienced by online payments during the pandemic is an undeniable fact, although it is true that the strong growth in users, operations and associated volume driven by Bizum already occurred before it.
In fact, during the first times of the harshest confinement, there was a slight slowdown that later gave way to the recovery of the exponential growth trend. In addition, the circumstances also accelerated the digitization of businesses, both large and small, some joining to sell online and others providing their customers with a better shopping experience, which was reflected in the fact that, while Bizum began 2020 with 200 participating businesses, the year with more than 8,000, thus also increasing operations in electronic commerce.
And the growth continues right now. The number of payment transactions between people carried out in the first half of this year equaled the figures recorded throughout 2020.
Thus, to date, more than 500 million operations have been carried out between individuals and 5 million purchases with Bizum, with associated volumes of 35,000 and 300 million euros, respectively. And we already have more than 24,000 businesses that accept payments with Bizum.
What is the user profile that Bizum uses? What do they use it for?
The users of Bizum are, in general, digitalactive in mobile channels and online payments, although their profile by age group is very broad.
Bizum has users of all ages. Although in the first years, the predominant age group was 35 to 44 years old, in the following three years the younger age groups gained weight. Already in 2020, with the pandemic, it has been observed how the older segments have gained weight, starting to use Bizum, becoming familiar with the solution and appreciating its ease of use and security. Thus, last year, those over 55 years old already accounted for 15% of users and the age group between 45 and 54 years old is 20% (compared to 11% and 16%, respectively, in 2019).
The most frequent payments by Bizum are those in which individuals share expenses or carry out joint social activities: dinners, gifts to friends or family, Netflix, rent… In addition, the use of Bizum for online purchases is growing, driven, among other reasons, by the growing interest of businesses in offering their customers this payment method. In fact, the goal we set ourselves for this year was to have 18,000 businesses accepting Bizum by the end of December, a figure that we already reached in June.
It also highlights the solidarity aspect of bizumers who, since the functionality of donations to NGOs was launched, have made more than 515,000 donations worth nearly 20 million euros.
How many users does the platform have?
We reach practically the entire population. We like to say that 99% of Spanish adults have Bizum, even if they don’t know it, because Bizum is in their online banking application; they just have to activate it.
We currently have 18.3 million userswhich represents more than a third of the total Spanish population.
What benefits does Bizum provide at the user experience level?
The truth is that, although there are many mobile payment alternatives, there is no solution that allows payments between individuals and in commerce, both electronically and in person, with the same immediacy, ease of use and security as Bizum. These are the most outstanding features and appreciated by users.
Bizum is a collaborative project between practically all Spanish banking entities, a universal service. This makes it a project, already starting, very different from existing and apparently similar initiatives.
Its universality is precisely one of the characteristics that users also appreciate. In addition, it is included in the bank’s apps, so that the customer feels comfortable in a known environment, which gives them security and confidence, since they do not need to download new applications or transfer data to third parties.
And, lastly, another highly valued feature, especially by businesses, is that Bizum was created in compliance with the criteria established in the transposition of the European payment directive PSD2, which regulates transactional information relating to customers of banking entities and encourages the development of new forms of data processing to try to protect them.
What level of fraud does payment with Bizum have?
Bizum guarantees its users a means to make their payments quickly, conveniently and, above all, safely. That said, there are always cybercriminals who take advantage of people’s good faith.
Criminal behavior or fraud attempts are not due to Bizum’s security flaws at all, but what they do is use Bizum as an instrument (as is the case with other solutions) or simply take advantage of its popularity.
To prevent unwanted situations, at Bizum we proactively communicate security advice through multiple channels and, above all, we focus on the difference between sending and requesting money. In money transfers, the recipient does not have to take any action, the amount reaches your account directly. In the case of requests, on the other hand, whoever receives a request must confirm that they want to make the payment through a message that clearly specifies whether the user wants to make a payment to the person who is sending the request.
On the other hand, we must also highlight that Bizum’s advantage is that each transfer can be traced and we provide this information to the authorities that request it so that they can carry out their work.
What are your goals for 2022?
Our goals for 2022 include continuing to increase the base of users and merchants, and accelerating the expansion of payment with Bizum in electronic commerce. We also set ourselves the goal of developing the face-to-face payment with Bizum through different technologies and the expansion and/or specialization of our value proposition for professionals, businesses and companies.
We will continue with our strategy of consolidating our services, analyzing and testing new features in parallel that expand the possibilities of mobile payment for its users.
Likewise, we want to focus on expanding and specializing the value offer for businesses, professionals and companies, and exploring and testing new services.
Bizum has many possibilities, but we are going step by step, slowly and consolidating projects before launching the next ones.
Where does the evolution of Bizum go in the coming years? Do you think about adding new functionalities?
We always say that we want Bizum to be the preferred means of payment for Spaniards in all areas of their lives. And so we hope it will be in the future.
To do this, we will continue to emphasize the benefits of Bizum, both for users and businesses. In addition, we will continue to develop new projects and functionalities, and expand our experience in face-to-face payments.
For its part, in parallel to the development of Bizum and on top of the common payment layer with Bizum, each Bizum bank will continue to incorporate its own differential services and additional payment functionalities. For example, currently, some entities already offer multiple payments, the possibility that users can accompany the payment with photos or emoticons; make Bizums from virtual assistants, keyboards from other apps or chatbots with messaging applications; or some entities also allow automatic distribution among several people of a previous payment made by a user on behalf of all.
Do you consider internationalization in the future?
Bizum is a solution promoted by Spanish banks that, at the moment, only works in our country for a matter of business focus; but its interoperability with other European solutions can be perfectly achieved. In any case, we have made ourselves available to the competent administrations to offer our help and knowledge for possible projects in this regard.
What headline about Bizum would you like to read next year in Marketing4eCommerce?
I would like to read that Bizum is the payment method that the Spanish prefer. That is our goal. And above all, that they are satisfied with the solution and that they continue to recommend it to friends and family, as they have done so far.
quick quiz
● What is the first social network you open in the day? Wiggle me for quick headlines and Twitter follow trends.
● iOS or Android? I started with iOS and the transition to Android was hard but I’m very happy right now.
● App or web? app.
● In which eCommerce and how long ago did you make your last online purchase? Today in two stores that accept payments with Bizum: Mifarma and RENFE.
● And what was it? Parapharmacy products and a…