September 23, 2017

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Don’t Expect Innovation from a Bank’s Imagination



Don’t Expect Innovation from a Bank’s Imagination

Spain’s CaixaBank believes it has created a new banking model. One that can only be accessed by mobile applications and exclusively online. On January 14th CaixaBank has announced its imaginBank, Spain’s version of a full digital service operating throughout social networks. Unfortunately, imaginBank is tethered to the same forms of centralization as in-house services and most likely worse off than traditional institutions. 

Also read: Block Size Consensus Reached? Bitcoin Classic is Unveiled

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The financial institution is targeting the younger generations believing they will appreciate its latest technology and find it resourceful. Isidro Fainé, Chairman of “la Caixa” Group says:

“imaginBank combines two of our bank’s key strengths: on the one hand our leadership in the world of innovation and mobility, which has garnered worldwide recognition, and on the other hand, our experience as a leading bank among the young client segment in Spain. This has enabled us to incorporate in this project all the features that our young customers look for in financial services, such as digital banking, simplicity and service excellence”.   

Most people would agree that many of these legacy financial institutions’ “new ideas” are merely rebranded forms of centralization. The cashless, modern day banking dream is riddled with data monitoring and extreme privacy breaches. Despite this, banks like CaixaBank in Spain believe they have something original. CaixaBank must have never heard of Bitcoin and other cryptocurrencies and how they don’t rely on third-party, use zero-knowledge techniques, and have no in-house operation. Meanwhile, none of the concepts within imaginBank’s imagination are new or original bringing forth the same defunct central bank concepts albeit with a shiny new bow that was cooked up at some uninspiring board meeting to say the least.

With Bitcoin, the concept of mobile or online only banking has already been created since the code’s inception in 2009. ImaginBank and clones like it most likely will falter to the same problems the entire centralized banking industry creates. But banks like CaixaBank only see the revenue they can attempt to collect off of the giant numbers of millennials using nontraditional banking. CaixaBank’s CEO Gonzalo Gortázar says:

“Our commitment to providing new services that perfectly complement the more traditional banking model, thus helping CaixaBank to secure greater loyalty among a large swathe of existing young customers, as well as to drive new customer acquisition.”

The imaginBank brings a few key items to the table that may provide it with some new customers such as commission-free products and services. This concept is something most banks should already apply to their protocol but instead have reaped billions of dollars off citizens with absurd fees.

Bitcoin does have voluntary miner fees associated with its transactions that are typically less than pennies and are significantly smaller than most payment processors today. These fees are meant to secure the network long after the last Bitcoin is found by mining operations. Minuscule fees that ensure the system in ways quite different than data collection and invasive tactics is quite refreshing in comparison to what the bank’s offer today. The Bitcoin protocol has no fees associated with its storage, and there is absolutely no one that can shut down your account — something CaixaBank cannot tell you in its latest press release because it would be false. The bank can suspend operations and reverse transactions as it is a fully centralized service.

So this announcement is one of many from incumbent banks who are perpetuating the old centralized model. ImaginBank doesn’t seem like it offers anything state-of-the-art but Spain’s CaixaBank sure would like the younger generation to think otherwise.  

What do you think about imaginBank? Is it a new idea? Let us know in the comments below.


Images courtesy of Shutterstock, Pixbay, and Vacate Wall Street



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