IBS Journal June 2015


‘The music industry, travel industry, now the taxi industry,


each said, not me, not me, then they fell over.’ Daniel Marovitz, Earthport


iZettle ©Håkan Dahlström, Flickr There have been three investments to


date. One is Tel Aviv-based MyCheck which integrates with merchants’ POS terminals and allows customers to use their mobile devices to view, split and pay bills. There is also Palo Alto, California-based Cyano- gen which has developed an open source mobile operating system. The third recipi-


record. An existing company in which Santander has an investment, Stockholm- based iZettle, has been moved into the programme. iZettle has come up with an app, chip card reader and business man- agement software tool for small business- es. There are pilots in multiple geographies for iZettle and MyCheck; Cyanogen will need a telco to work with and there are dis- cussions with Spain-based Telefonica. Clearly, although the Santander fund


is nominally London-based, the invest- ments are international. Unlike other initia- tives, there are not physical workspaces on


be interesting’, says Belinky. Each InnoVen- tures company has an action plan which might include ways to leverage the bank’s 107 million retail customers and three mil- lion SMEs across 25 countries; expertise in areas such as compliance; help with other logistics such as recruitment; and, from the technology team, advice on how to ensure that the solutions are scalable. That latter type of IT help is as far as


it is likely to go. ‘Usually, they are working with technologies that are more advanced that what we have,’ says Belinky. ‘Usually,


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we don’t work in the same universe.’ How- ever, the bank does have expertise in creat- ing robust, scalable solutions and can also help with connectivity to its core banking systems, he says. There is no predetermined exit, says


Belinky, and Santander is not expecting to acquire the companies. In, perhaps, one out of ten cases, there might be discussions about whether this could ultimately make sense but the bank didn’t want to take a narrow, restrictive approach to the invest- ments, he says. In parallel, Santander has an internal innovation programme which is based in Madrid and is headed by its for- mer head of technology and operations, with a number of priority areas of its own. Part of the strategy is the joint venture set up in 2013 by Santander, Caixabank and Telefonica to develop new digital business- es. This was branded as Yaap in April 2014


-


ing with Yaap Shopping to provide a virtu- al online store for small retailers and Yaap Money for P2P payments. Partnerships are certain to be an


important facilitator and the results of collaborations are starting to appear. For instance, CBA in Australia has teamed up with realestate.com.au and RP Data to launch an app that allows users to access data on 95 per cent of Australian proper- ties, whether or not they are for sale, by merely taking a photo on their smart- phones. Users can instantly calculate mort- gage and insurance payments, potential rental yields and likely sales prices, and can


© IBS Intelligence 2015 www.ibsintelligence.com


and capital growth trends. In parallel, it is almost impossible to


without now mentioning blockchain, the technology that underpins bitcoin. This dis- tributed, secure, public and private ledger model will be ‘transformative’, says Fayyad. Earthpost’s Marovitz believes the ques- tion is about how and when it will have an impact – ‘we are all wrestling with that’ – and how it will be possible to add screen- ing, compliance, and monitoring, as well as building the bridges between this and today’s infrastructures.


Marovitz for those that resist innovation or merely pay lip service: ‘The music industry, travel industry, now the taxi industry, each said, not me, not me, then they fell over’. While governments might not allow this to happen to banks – they are a ‘protected class’ – and there is a problem for outsiders to access the banking infrastructure, the warning signs are there about the funda- mental nature of the sector in the future. This realisation is a key reason for so


much activity related to innovation in the last year or so. Belinky adds that, prior to Santander taking its leap, internally and externally, so much of the time in the previ- ous few years had been spent dealing with


so banks and others are at last able to turn to the future rather than struggling to just keep up with the present.


innovation spotlight


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