From his beginnings in Latin America to leading the expansion of a fully digital bank, Diego shares insights on personalization, agility, and financial education. If you’re curious about how debt consolidation and technology are reshaping the relationship between banks and users, this interview has all the answers!
Diego Azorin,“We will eventually consolidate a very powerful
digital alternative in the Spanish market”.
Head of Spain at Lea Bank.
Diego’s professional journey: from Latin America to banking digitalization
After a warm welcome, Juanjo Gómez, CMO of Coinscrap Finance, invites Diego to share his career path with the audience. Diego notes that his professional experience has always been intertwined with consumer credit and digital banking. He recalls his early days in traditional Latin American banking, juggling studies and work.
Later, upon returning to Spain, he delved into the consumer credit sector, working with entities like Cetelem, Cofidis, Bigbank, and Ferratum Bank. “I’ve been navigating the stages of consumer credit and digital banking in Spain for quite some time now,” he remarks.
What is Lea Bank and its proposition in Spain
When Juanjo inquires about the essence of the institution, Diego explains: “Lea Bank is a 100% digital bank that was established in 2015 from the merger of two fintechs, which acquired the banking license of a pre-existing bank in Norway. Over time, the bank began expanding to other Scandinavian countries, and in 2022, we arrived in Spain.”
Lea Bank’s business model combines the best of both worlds: the traditional banking structure of deposits and loans, and a highly digitized and automated operation. In Spain, the bank primarily offers personal loans and debt consolidation loans, as well as deposits through a collaboration with Raisin.
Product strategy: why personal loans and debt consolidation
Our Head of Marketing delves into the product strategy. Diego emphasizes that despite the sector’s high competition, the Spanish market still offers significant opportunities: “Much of banking activity still takes place in branches. We’ve made great strides in digitalization, but there’s still a long way to go, and that’s where we fit in,” he explains.
The first product launched was the personal loan, due to its versatility and adaptability to various customer needs: “From buying a car, a wedding, a trip… It’s a broad product that supports customers through different needs.” Later, they identified a growing demand –and limited supply– for debt consolidation.
“This product allows for a monthly payment reduction of approximately 40% compared to what the customer usually pays. People often consolidate two or three loans: a credit card and two loans, or a car and a personal loan. The average savings we generate for the customer is around 40%.”
Technology and automation: the engine behind Lea Bank’s experience
Technology is the cornerstone of Lea Bank’s proposition. The use of open banking and biometrics has enabled the institution to transform traditionally slow and manual processes into agile and secure experiences. “Open banking is a fundamental pillar for us.”
Thanks to this technology, Lea Bank can view and analyze customer information in real-time and make immediate decisions on loan approvals. “We complement this with biometrics to prevent identity fraud, which used to be a significant issue.”
Automation has allowed Lea Bank to handle a very high volume of applications: “In the past year, we’ve processed nearly 786,000 applications automatically. Our greatest advantage is having a highly automated process.”
Debt consolidation and financial health
The debt consolidation service is one of Lea Bank’s major differentiators. Its operation is simple: the customer connects their bank account, provides information about their debts, and Lea Bank manages the cancellations and offers a competitive solution. The goal is to free up part of the customer’s monthly income, allowing them to allocate less of their salary to debt payments and more to personal projects or quality of life.
Diego explains: “We’ve come from a period of high-interest rates, and now that they’ve decreased, there’s a great opportunity to promote a healthier economy. This way, instead of allocating 60% or 70% of their salary to cover debts, customers have more availability for other projects and to enjoy life.”
Regarding financial education, Diego notes: “Many customers are unaware of these types of solutions. We’ve seen a considerable increase in demand; approximately 30% of the applications we receive are for debt consolidation.” He asserts that having the right financial education allows for a more peaceful life and balanced financial health.
The Spanish market: challenges and opportunities
When comparing the Spanish market with other European countries, Diego identifies structural differences rather than customer behavior. “Generally, the customer tends to be similar. The main difference lies in the context surrounding decision models and the information available in the market.”
Spain has a higher default rate and, consequently, higher prices than other European markets. Additionally, the debt cancellation process is less agile than in Nordic countries, where a user’s order is sufficient to close loans with any institution.
💡 Diego said…
“We don’t require any documentation, (our process) is very agile with immediate decisions. We operate on a risk-based pricing model that allows us to tailor the offer to each customer’s profile.”
The alliance between banks and fintechs: key to innovation
Diego emphasizes that collaboration between banks, neobanks, and fintechs is essential to accelerate financial innovation. While institutions can develop solutions internally, partnering with tech specialists allows for faster time-to-market and higher-quality products.
“It’s very important to rely on specialists. There are experts who develop solutions already adapted to the market and that meet all regulatory requirements.” Moreover, he believes that collaboration is not only advisable but essential to offer better services to customers.
Financial inclusion and the challenge of credit history
Our guest points out that the lack of credit history disadvantages migrants and new residents in Europe, even if they are good payers in their home countries. Diego cites the example of the United States, where scoring models already integrate data from services like Netflix to assess creditworthiness. “In Europe, initiatives like FIDA (Facilitating Inter-Digital Assets) aim to aggregate information from insurance and utilities, but they are still in development,” he states.
Diego advocates for the idea of a European financial passport that allows all residents in the eurozone to access credit in any country, integrating data from various sources. “Fintechs can probably play a key role here, helping institutions analyze –and interpret– the information and facilitate inclusion.”
Artificial intelligence and the future of the financial sector
Regarding artificial intelligence, Diego jokingly recalls the movie “Terminator” and comments: “Fortunately, it’s not Skynet, so it’s going to help us a lot in generating greater information processing capacity.” Lea Bank is exploring its use in risk calculation and customer service.
Although scoring models are still in the experimental phase due to regulatory requirements and the need to avoid biases, AI is already being used in categorizing banking transactions and improving internal management processes.
Looking ahead, Diego states that Lea Bank’s goal is to consolidate its presence in Spain and grow to match the size of its Scandinavian market. He anticipates that neobanks will continue to gain market share and position themselves as solid alternatives to traditional banking, thanks to a closer relationship with the end consumer and their innovative propositions.
In short, Lea Bank is the ambassador of a new generation of digital banks, capable of combining technological innovation with a vision centered on the real needs of the population.
We conclude with a special thank you to our guest and, of course, to our audience. Thank you for being there!
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