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First Financial Bankshares: Small Bank, Big Innovation

Jeff Casey has spearheaded a mobile revolution at First Financial Bankshares, with products that can rival offerings from the big boys.

Conventional wisdom states that community banks can't offer cutting-edge, innovative technology products as the big banks do, but they make up for that with more personal customer relationships. According to Jeff Casey, it doesn't have to be a case of sacrificing one for the other.

"We are a community bank and we pride ourselves on being involved in the community and being that local bank, but when it comes to technology we feel we are competing with the big banks," says Casey, senior VP of alternate delivery channels for First Financial Bankshares (Abilene, Texas; $4.9 billion in assets).

Casey says small banks can -- and indeed, must -- offer the same technology products to customers that large banks do, especially when it comes to mobile. Accordingly, Casey and his team of around 30 professionals have helped roll out an impressive array of mobile services for a community bank. First Financial operates 66 branches, primarily in Texas.

As 2012 dawned, First Financial didn't even have a mobile app, although it was in the works. Initially First Financial looked at mobile as an extension of online banking, Casey says, but quickly realized "that we needed to look at mobile as a strategic channel that's separate from online." After issuing an RFP, First Financial chose a mobile product from Austin, Texas-based Malauzai Software and rolled out its first mobile offering in March 2012. Mobile adoption soon skyrocketed, and Casey knew he had to add even more of the innovative mobile functionality that his customers desired. In November 2012, First Financial added a mobile remote deposit capture capability. And in January of this year, the bank partnered with Allied Payment Network, which leverages Mitek's Mobile Photo Bill Pay technology, on a mobile bill payment application that enables customers to pay bills using the camera on their mobile devices. First Financial was the first bank in the country to roll out this photo bill pay system, according to Casey.

More than 2,000 payments have been made via mobile bill pay so far, and Casey believes it to be an extremely important product. "Bill pay is a sticky product," he says. "If a new customer already has bill pay set up at another bank, they don't have to re-create everything inside our bill pay system, just snap a picture one time."

Which Way For Mobile Payments?

Though it has offered mobile banking for less than two years, First Financial has around 30,000 registered mobile banking users, about 30% of its online base. Additionally, Casey notes that between 5,000 and 7,000 of those are mobile-only customers, including not just new customers, but existing ones who switched to the mobile channel completely. Mobile also has produced a cost savings for the bank. Casey examined dollar amounts associated with customer transactions in each channel -- call center, branch, ATM and online banking -- and estimated that shifting some transactions to lower-cost channels, such as mobile, saved the bank $300,000.

But the mobile revolution at First Financial is only just beginning. Casey says he is exploring a mobile payment solution. "Right now we're in talks with vendors and figuring out which directions we want to go in," he adds.

Bryan Yurcan is associate editor for Bank Systems and Technology. He has worked in various editorial capacities for newspapers and magazines for the past 8 years. After beginning his career as a municipal and courts reporter for daily newspapers in upstate New York, Bryan has ... View Full Bio

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User Rank: Author
10/3/2013 | 1:17:44 PM
re: First Financial Bankshares: Small Bank, Big Innovation
Yeah, interesting that he mentioned Google specifically, often a bank won't directly acknowledge the potential of these "nontraditional competitors" to cause disruption. But, smartly, Casey is planning for not just now but the future.
Greg MacSweeney
Greg MacSweeney,
User Rank: Author
10/3/2013 | 12:37:58 PM
re: First Financial Bankshares: Small Bank, Big Innovation
For many consumers, they no longer think about a formal "bank" as a must have relationship for them. They can buy things online via paypal and make payments in other ways. Banks no longer hold a grip on the consumer. Granted most consumers will still go to a bank for most of their needs, but some groups (especially younger demographics) find it easier to make payments by alternative methods.
User Rank: Author
10/3/2013 | 1:36:27 AM
re: First Financial Bankshares: Small Bank, Big Innovation
Nate, payments -- more specifically mobile payments -- definitely is where banks are feeling the heat (or fearing they will feel it) from non-traditional competitors, not just Google, but Paypal, Apple, Walmart, Square, telcos, and a host of emerging, tech-based and (so far) unregulated players. A growing number of consumers -- not just the traditional unbanked but also students, middle-class consumers, etc. -- are handling some aspect of their financial services with a non-bank.
Nathan Golia
Nathan Golia,
User Rank: Author
10/2/2013 | 7:43:50 PM
re: First Financial Bankshares: Small Bank, Big Innovation
Interesting points on mobile, especially combining payments with marketing. Also can't help but notice that he mentions Google as an encroaching force Gă÷ I just wrote in another comment that the financial services industry is getting close to feeling the disruption of a Google or other tech company opening its own financial services firm. Payments might be their entry.
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