Aug 11
30
In support of the upcoming Financial Technology Innovation Forum, I recently sat down with Finance IQ to share some insights on mobile applications for the Financial Services Industry. Check out our interview below.
The impact mobile applications will have on Financial Services companies is not yet clearly defined. As mobile increasingly becomes an ever more essential part of the way customers conduct their business, players in the financial services industry need to make sure they do not lag behind in their technologies. Finance IQ interviewed Matthew Wilcox, Vice-President of Interactive Services at Zions Bancorporation on the state of these technologies today, and going forward where he foresees mobile taking Financial Services companies in the future.
Finance IQ: Can you address the concepts, methods, and issues for mobile applications in the Financial Services Industry?
Matthew Wilcox: There are numerous mobile application concepts that range from security to m-commerce within the Financial Services industry. The toughest part of managing a mobile product is navigating through all the hype to get to the small nuggets of material that are relevant to your business. If method is a new way of defining mobile strategy then the answer is it is a no-win scenario. Financial Institutions that are on the bleeding edge are investing in technology that has a limited shelf life, given the rapid advances in mobile technology and the constant demand from mobile bankers to have the latest and greatest. Close followers seem to be making similar mistakes as those on the bleeding edge, due to the time and complexity involved in bringing up new mobile technologies – and the laggards in this space won’t need to worry about mobile since they will not have any customers left. Addressing concept and method should provide you with a solid taste of the issues the Financial Services industry faces in regards to mobile, and all of this happens before you get to security and ROI.
Finance IQ: What kind of impact have mobile applications had on the financial market?
Matthew Wilcox: At this point in the evolution of the Financial Services mobile application we are not at a point where the impact of mobile applications on the financial market is clearly defined. I think everyone agrees that this space is going somewhere, but whether or not mobile lives up to all the hype as the next step in commerce within the U.S. has yet to be seen. Depending on where mobile lands in the next few years will give us a better understating of the kind of impact mobile applications will have on the financial market. However, I predict mobile will overcome online banking in terms of usage and will also be seen as a fully-fledged marketing channel.
Finance IQ: What kind of impact have mobile applications had on your business?
Matthew Wilcox: Currently mobile applications have been seen as an investment in our future. We have had to invest as part of our overall online/mobile strategy. It is important for us to meet consumer expectations for service delivery set by larger financial institutions such as Citibank, Chase, Wells Fargo and Bank of America. In the near future we expect mobile to have a much more positive and profound impact on our business especially when you look the potential that m-commerce presents, which is why it is so critical for us to continue to gain experience in this space.
Finance IQ: What are some conceptual products that make a significant impact in security?
Matthew Wilcox: Products currently exist that have an impact on security and risk, such as Mobile RDC and P2P Transfers. However additional products, such as the mobile wallet, are in the conceptual phase and will have as dramatic an impact on security. In addition, the mobile malware (along with phishing and spoofing techniques) are in their infancy and many of the tools needed to combat these threats have yet to be developed.
Finance IQ: Where do you see this technology taking the Financial Services Industry in the future?
Matthew Wilcox: In the future, mobile will most definitely replace online banking, but more importantly mobile will change the way consumers interface with their Financial Institutions. In a world where managing finances is a monthly, weekly or daily event, mobile will most definitely push more customers and small business owners towards real-time financial management. Even more intriguing is the mobile wallet, which in theory will consolidate the consumer facing process of commerce down to a single application on a mobile device.
Matthew Wilcox is a speaker at the upcoming IQPC Financial Technology Innovation Forum, October 17 to 19, 2011 in New York City. For more information or to register, visit www.financialtechforum.com or email [email protected].
Ah, the ubiquitous Google. It’s not just for maps, web, images, videos, news, shopping, mail, analytics, advertising, translations and, well, everything under the sun anymore. Now it’s in your wallet. On second thought, make that, now it IS your wallet.
Yes, Google Wallet is here. As more and more businesses hop on board, expect to be able to use it at a retailer near you.
Google Wallet is a smart phone app on which you can store virtual versions of your credit and debit cards, so you can use your phone to make purchases and redeem offers.
It works by use of Near Field Communication (NFC). I’ll skip the technical jargon and simply say that NFC lets you wave your phone at a little device at the checkout counter to pay for your stuff. (Before you get too excited about having your phone cover your expenses, I should clarify that it does so with your money.)
In hopes of preventing innovative criminals from accessing your smart phone and walking away with your personal information, Google has loaded NFC with security features. It works only when your phone is very close to the receiving device. It turns off when the phone’s screen is dark. It requires PIN access. And the chip self-destructs if someone tries to hack it—yes,really.
As with most new technology, the demand will increase and Google Wallet (and future competitors) will become as common as, well, Google. I can just imagine where this might go…
• You have insufficient funds in your checking account. When you make a purchase, the phone automatically transfers funds from your savings and completes the transaction as you wave it over the transceiver.
• It’s payday. Just as workers used to line up at the time clock to punch in and out, now you line up at the transceiver and your paycheck is loaded onto your phone.
• In restaurants, servers bring a mobile transceiver to your table and you wave your phone to pay.
It may not be a real magic wand, but it sure comes close.
Jul 11
12
A growing number of Americans rely on their mobile phones to access the Internet, utilize money-saving applications and engage social networking websites. But a new survey shows consumers are also using their smartphones to manage their finances.
The results of the study – conducted by strategy consulting and research firm Mercatus – suggest that as mobile ownership increases, consumers are being more selective about the financial institutions they choose, opting for those that offer mobile banking features. The study shows that smartphones make up roughly 50 percent of all phones owned, an increase from one-third of cellphones owned last year. In addition, the study shows phone usage is actually down, while texting, Internet access and other functions have increased.
“With mobile emerging as a critical bank selection criteria, mobile capabilities become extremely important to a bank’s new customer acquisition and growth strategies,” said Mercatus partner Teresa Epperson. “This year, 35 percent of consumers told us that mobile was an ‘extremely important or important’ consideration in their selection of a new primary bank, up from 20 percent one year ago.”
A larger number of banks now offer mobile banking to customers who are enrolled in online banking accounts. Individuals can use mobile banking to inquire into their balance, transfer money and in some cases, deposit checks.
Jun 11
9
Mobile devices are becoming one of the primary portals Americans are using to manage their finances, access the Internet or shop online. In recent years, mobile banking has been introduced to consumers, allowing them to forgo conducting transactions at physical financial locations, and opting instead to process them through their mobile device. While the mobile banking process was initially met with some concerns over security matters, these fears have been allayed in recent years. As a result, mobile banking platforms are booming, and expected to continue their upward growth, according to the results of a new study.
New data from leading research firm comScore reveals more Americans are relying on the mobile platform as a primary method of conducting financial transactions. The results of the study show the number of Americans who accessed their bank, credit card or brokerage account from their mobile device during the fourth quarter of 2010 increased by 54 percent from one year ago, topping out at 29.8 million consumers. Twenty-six percent of respondents say their mobile phone is the primary way in which they access their accounts. Only four percent say they conduct banking transactions by contacting the branch via phone calls and another 10 percent said they still do their banking at a branch.
“More people are turning to the convenience of mobile devices for their financial service needs, fueled in part by the adoption of smartphones, 3G devices and unlimited data plans,” comScore Vice President Sarah Lenart said. “The ubiquitous nature of mobile devices affords financial brands an important channel to reach and engage customers, whether it’s at home, work or on-the-go.”
The results also broke down the ways in which consumers accessed their financial accounts via their mobile devices during the fourth quarter of 2010. Roughly 18.6 million Americans gained entry to their accounts via a mobile browser, an increase of 58 percent from the previous year. Another 10.8 million relied on applications to access their accounts, up 120 percent from the same period of 2009. Lastly, the number of consumers who utilized SMS text messaging to access their accounts increased 35 percent to 8.1 million.
However, a small percentage of the respondents reported they were unaware they could access their bank accounts through their mobile devices. Six percent of smartphone users were unfamiliar with mobile banking services and 5 percent of non-smartphone users gave the same answer. Many banks are doubling their efforts to market mobile banking services to consumers, as evidenced by Bank of America’s recent announcement that it plans to hire new executives to make improvements to its mobile platform, according to Bloomberg.
However, almost 50 percent of those surveyed say they continue to rely on online banking to conduct the majority of their financial transactions. While mobile banking is expected to grow in the coming years, online platforms continue to provide customers with more services and flexibility in managing their accounts. Currently, typical mobile banking features allow consumers to check balances, transfer funds and, in some cases, deposit checks by photographing and emailing check images. However, online banking allows consumers to see a running list of account activity, pay bills and review their investment account details. Online banking also allows users to transfer funds to other customers, a popular service for parents with college-age children. Some mobile banking users are finding ways to maximize both services, as banks generally require users to have an online account with the institution before they can enroll in mobile banking.