The mobile payment solution for Spanish banks, Bizum, has about five years of history. He was born in 2016 at the right time and in the right way. It could be the success story of a startup who came to solve a problem and was rewarded by the public, but the idea comes from a traditional sector and even centuries-old companies.
It is the result of the union of different Spanish financial entities that believed that joining forces to offer a universal mobile payment solution for all entities, with a single infrastructure, added up. And yes, it has added.
From Bizum they expect to have real experiences of payment in physical commerce in the last two quarters of the year
Bizum doubled its number of users and greatly tripled operations and volume in 2020. At the end of March, they have also announced that they have reached 15 million users and continue to grow in 2021 with an eye toward obtaining benefits for the first time. Although that is not your main objective as explains Fernando Rodríguez, Director of Business Development at Bizum, what an adventure to Genbeta the progressive arrival of the service to physical stores in the coming months.
From instant transfers to a true payment system
The numbers that Bizum is reaping in recent months speak for themselves. The pandemic has driven its use and the brand has already penetrated everyday language, even becoming a kind of meme when WhatsApp falls. "Anything, Bizum", is a recurring joke on Twitter when the instant messaging platform fails.
The milestones that the service of Spanish banks is reaping they assure him, for now, to emerge stronger from a crucial year for them. Since 2019, 2021 has been the period set to abandon the losses of a company whose objective was never to register large profits, although it may be striking. "Our idea is not not to be a more profit-oriented company, but rather a company oriented to contain costs," says Rodríguez.
Bizum expects to disembark in the coming months in physical commerce with payments through QR codes
They keep the business plan and the projection follows the steps set. If there are benefits this year, what do you expect, These benefits will be distributed in the form of dividends to the entities that financially support the project or will be reinvested in the initiative. Because the banks are the ones that pay fees for the use of Bizum and what they decide if, later, they charge their customers for the use of the system or not. In addition, over the next few months, Bizum hopes to enter physical commerce with more than one experience essentially based on QR code technology. A technology widely used by platforms such as WeChat, the super application China in which, of course, they are fixed as they confirm us.
In the end, in practice, the movement involves commercializing the experience acquired with State Lotteries and Betting. For the administrations of lotteries and at the request of the State Lotteries and State Betting Society, Bizum developed a system that is based on QR codes and serves both to pay bets and to collect prizes. The idea is to take advantage know-how and open it to all types of physical commerce, large or small. Generalize this system.
The idea is to begin to generalize payments through QR codes this year
"What we are doing right now is studying the different user experiences that we would have at our fingertips and seeing the impact. The one we already have is the generation of the QR by the user. We are also evaluating the generation of the QR by the business and also the possibility of the payment being contactless ", indicates the manager." That is, a user can show a QR and be able to pay and the idea is to take advantage of that first experience and launch it in other types of stores: large chains and small stores ".
It also involves using a technology that a second youth lives during the pandemic because it is being used, for example, in the hospitality industry to display cards. Although it is not used to pay, more and more people are familiar with this evolution of barcodes. Although they do not rule out other payment methods for the future.
And when will QR payments arrive at Bizum in a more generalized way? "We hope it will be this year", answers Fernando.. "Q3, Q4 ... in the last two quarters of the year we hope to have some real experience. It also depends a bit on the merchants. They have to make their adaptations and, being a new payment method, we have to see what the times are We are working right now on what are user experiences, technical development and we trust that sometime this year this will be underway. "
"In the last two quarters of the year we hope to have some real experience"
As has happened in electronic commerce, The idea is that banks market this solution to all those businesses that are interested. "We launched the possibility of payment of sales on-line with Bizum at the end of 2019 and we have noticed a very strong increase over the past year. We ended up with 200 stores in 2019 and in 2020 we were close to 10,000. The objective this year is to practically double these stores, to stay at around 18,000 stores, "he explains.
"It would be like it has happened with electronic commerce. Interested businesses have to talk to their bank, hire it ... Large businesses, like electronic ones, also have their own systems and require almost personalized development of any type of new integration. So I think that will take a little more time, but surely we will see some great businesses accepting physical payments this year. "
Many small businesses use Bizum, especially in recent months, apart from the business solutions of the Spanish banking system
However, especially in recent months, anyone has seen how small businessmen in the hospitality industry and other types of businesses have informally adopted Bizum with the solution designed for payments between individuals. The idea is to offer them solutions soon so that they do not have to provide the phone number and use the service in a regulated way, so to speak. And to avoid this unanticipated use, among other reasons, there are limitations.
"Bizum at the end it is still a transfer right now, but with limits. I can make a transfer, the amount that anyone wants and without any limitation, but in the case of Bizum we can only receive 150 operations per month ", says Fernando. In addition, the maximum amount of daily operations is 2,000 euros These uses outside the established are monitored by the company.
Bizum's particular strategy: a service integrated into bank applications
While other highly successful solutions such as Swish, the most popular payment application in Sweden sponsored by the six large banks in the country, chose to launch as an application, the Spanish banking solution decided to be integrated into the applications of the entities.
"The decision responded in the end to a strategic question," says Rodríguez. "Or parts of an application that has zero users and you make it grow or parts of N applications that already have thousands of users behind and you only put that service for them to use, adding little by little more value to the bank's application". It was the decision taken, although on the table there was also the possibility of lighting an independent application. An idea that they do not rule out for the future with the idea of being able to integrate any user of third-party entities not participating in Bizum.
The idea of an independent Bizum application is not ruled out for the future
This decision, however, involves certain complications. While Bizum as such is in charge of "maintaining the brand, setting the rules of the game (that is, the limits of the operation), working on the definition of new use cases. [como la solución de gestión de pedidos recientemente lanzada] and that all entities are on the same plane ", hence its famous seven employees, these entities are the ones that must make the developments on their own platforms. The service operators are, at the same time, different partners technology with different speeds.
This is why the new functionalities, basically payment in electronic or physical stores, do not reach everyone at the same time.. Currently, of 31 financial entities that are part of Bizum, only 19 offer payment in ecommerce (the functionality is over a year old) and 9 the use of QRs in lottery administrations. An uneven experience of using the service that works against it. During this time, in addition, the payment experience on-line It has been renovated.
Of 31 banks with Bizum, only 19 offer payment in 'ecommerce' after its launch at the end of 2019 and recent renewal last March
"We are seeing that perhaps some entities adopt this type of development at a greater speed and what we do with those that are a little further behind is to work with them so that they can remove the functionalities as soon as possible," acknowledges Fernando Rodríguez. The idea is, he explains, "to present a homogeneous user experience in any entity". For this reason, he assures that they are working to shorten deadlines and, in addition, ensure that the new entities to arrive, ING was the last large one to arrive, are released with all the functionalities in place. "Whenever the Bizum logo is seen on a site, any user must be able to use the service offered there."
The pandemic and Bizum
We said at the beginning that the pandemic and the need to reduce contacts of all kinds, even when paying, have driven the use of Bizum. Something that corroborates its director of Business Development to this medium. Immediately after the declaration of the state of alarm in Spain, several weeks of falls were chained in use after the initial shock, but soon the situation began to normalize, although payments were already going beyond those made between friends.
In 2020, the segment of Bizum users that grew the most was that of people who are over 50 years of age
Classes were paid on-line, purchases made by a third party were paid ... and its use was also increased in terms of charitable causes. Bizum allows making donations to non-governmental organizations or religious organizations and sending money, especially to churches, set records. "More than 50% of the 3,500 NGOs that we have right now are parishes," exemplifies Fernando.
The impact of the coronavirus on our lives has also led to an increase in digitization in practically all segments of the population. If before the pandemic in Bizum they saw how users from 18 to 34 years old grew, in 2020 the segment that grew the most was that of people who are over 50 years old. "Is very striking", concludes Rodríguez.