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Understanding the digital jump of bank customers is key to design strategies to bring on board and keep online users, as well as to explain the increasing competition from new providers of financial services (such as BigTech and FinTech). This paper employs a machine learning approach to examine the digitalization process of bank customers using a comprehensive consumer finance survey. By employing a set of algorithms (random forests, conditional inference trees and causal forests) this paper identities the features predicting bank customers’ digitalization process, illustrates the sequence of consumers’ decision-making actions and explores the existence of causal relationships in the digitalization process. Random forests are found to provide the highest performance–they accurately predict 88.41% of bank customers’ online banking adoption and usage decisions. We find that the adoption of digital banking services begins with information-based services (e.g., checking account balance), conditional on the awareness of the range of online services by customers, and then is followed by transactional services (e.g., online/mobile money transfer). The diversification of the use of online channels is explained by the consciousness about the range of services available and the safety perception. A certain degree of complementarity between bank and non-bank digital channels is also found. The treatment effect estimations of the causal forest algorithms confirm causality of the identified explanatory factors. These results suggest that banks should address the digital transformation of their customers by segmenting them according to their revealed preferences and offering them personalized digital services. Additionally, policymakers should promote financial digitalization, designing policies oriented towards making consumers aware of the range of online services available. FUNCAS Foundation PGC2018 - 099415 - B - 100 MICINN/FEDER/UE Junta de Andalucia P18RT-3571 P12.SEJ.2463

Artículo de revista The main aim of the paper is to examine the current situation and evolution of the Spanish FinTech ecosystem and the driving forces of the performance of these firms. After examining the current situation of the Spanish FinTech ecosystem at an international level, we show that Spain has a solid and dynamic FinTech sector in terms of FinTech firms per capita (5 firms per million inhabitants) but with relatively low levels of investments and FinTech credit (3.4€ per capita). We also show that most of the Spanish FinTechs are focused on offering B2B solutions, obtain revenues via charging fees or commissions and have not matured enough. Moreover, most of these firms were founded by entrepreneurs and are located in large cities such as Madrid and Barcelona. We also document a positive evolution of the funds invested – mainly through venture capital funds – on the whole Spanish FinTech sector since 2014. In terms of performance, FinTechs founded by a few number of entrepreneurs perform better. We also find that being located in Madrid or Barcelona does not have an effect on performance while those FinTech receiving external financing via seed capital exhibit lower returns.

Artículo de revista This article surveys the recent changes in and outlook for wholesale and retail payments in Europe and the US. We document a convergence in payments institutions and patterns of use, although differences in retail usage remain. An overarching theme of our survey is the importance of the differences in regulatory structure between the two areas. These differences are both a product of differing initial conditions and a catalyst for contrasting responses to current technological challenges. The Single Euro Payment Area (SEPA) is a major effort to unify the payment market and instruments in Europe, although substantial heterogeneity remains in some payments platforms. In the more unified US payment system, centralized programs for payment system improvement are much weaker and more preliminary. We examine the consequences of this difference on the responses to the most recent payment innovations – the so-called fintech revolution. Here the key regulatory challenge is to balance the concerns of the traditional providers of payments services within the financial industry with the needs of the newcomers, in order to obtain the right tradeoff between innovation and safety.