On Monday, BBVA Compass, a U.S. wing of the Banco Bilbao Viscaya Argentaria S.A. (BBVA), formed a strategic agreement with SmartyPig to serve as a depository institution for the latter’s customers in the U.S. and expand their shared customer base. SmartyPig is a consumer finance site where the individuals can earn high interests on their savings and get cash back rewards.
SmartyPig has imparted Web 2.0 features that can encourage consumers to reach their financial goals through savings. For this, the customers can have monthly recurring deposits or one-time contributions. The deposit amounts may either be fixed by the customers themselves, according to their requirements, or may be calculated by the system. BBVA Compass provides these savings accounts and the money deposited is insured by the Federal Deposit Insurance Corporation, up to the applicable legal limits.
SmartyPig customers have received notice, allowing them to choose whether to continue their SmartyPig accounts with BBVA Compass as their new bank. The customers who agree to continue with BBVA will have to authorize the transfer of their funds to their new BBVA Compass savings accounts effective as of August 1, 2010.
BBVA Compass is one of the few banks that will be able to handle the scale of SmartyPig’s growth and integrate its current customers. In addition, it will provide SmartyPig with its superior brand recognition, innovative banking products and services and global access.
The basic idea of SmartyPig is to help individuals mobilize their savings into deposit accounts and reduce their dependence on the credit cards. Launched in 2008, SmartyPig has proved extremely popular among customers, who are concerned regarding rising debt levels and unstable economy.
The U.S. financial crisis has had major ramifications across the whole world, although it is comparatively stable now, with the financial support from the government. The government had taken several steps, including programs offering capital injections and debt guarantees, to stabilize the financial system. In such a scenario, it would be prudent to enhance savings, instead of raising unnecessary consumer debt through credit card usage.
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