The CEB TowerGroup Financial Services technology conference, held last week in Boston, featured dozens of speakers and hundreds of attendees gathering to discuss the latest trends and issues in the industry. While much was discussed, Bank Systems & Technology highlights three key takeaways from the event.
In the highly mobile, ever-evolving technological world we live in, banks must be innovating or risk alienating consumers. This message was driven home by Mark Jamison, managing vice president of Capital One Labs, a small division of the larger bank that is tasked with developing innovative digital products and "re-imagining the way customers interact with their money."
Jamison noted how the advent of smart mobile devices have been a catalyst for "creative destruction," and referenced several industries that have been greatly marginalized by recent technological advances, including travel agencies, atlas publishers and camera makers. "There have been major industries eaten up by apps," he said, adding, "Of the original Fortune 500 list [first published in 1955] less than 15 percent still exist today."
This warning is especially pertinent for banks, he noted, who face increased competition in some aspects from nontraditional competitors, such as Google, PayPal, Bitcoin and Green Dot. "I think they're more of a threat that many people realize," he added.
Jamison advised banks to incorporate characteristics that are usually indicative of the most technologically innovative companies, such as speed and agility, collaboration and dative design.
2. Big Data
Data is being created at a pace unseen in the history of world prior to today. How banks can effectively capitalize on all of this wealth of data to serve existing customers and create new ones has been an ongoing point of debate in the industry.
Randy Packham, VP Financial Services Solutions for SAP, dealt with some of these issues during a session titled, "Data-Driven Strategy Done Right: Getting the accurate, actionable data that you need when you need it."
Packham noted that consumers are more informed than ever before, and their expectations of their banks are rising. Banks need to present relevant, timely offers and marketing messages to customers using data analytics.
However, Packham also warned banks to avoid what he called "the creepy factor" and not "freak them out" with the use of personal data.
Mobile has firmly entrenched itself as a mainstream channel, but according to CEB TowerGroup research, it is still not the preferred channel among most consumers.
Jason Malo, a research director in the firm's Retail Banking and Cards practice, said during a presentation on mobility that mobile bankers use the channel for alerts, with occasional transactional capability. According to a recent CEB TowerGroup survey of mobile banking consumers, 54% said the most important mobile function to them was being able to receive notification from their bank about irregular account activity or changes to their account.
[The New Ecosystem for Mobile: Technology Alliances for M-Payments and M-Banking]
Compared to mobile banking, mobile payments "still have a ways to go" before reaching mass consumer adoption, Malo noted. He added that the U.S. "is a bit behind the curve" when it comes to mobile payments, as several different payments networks and vehicles are still competing for dominance in the still-nascent mobile payments market. Malo also said companies offering mobile payments services need to make a compelling argument to consumers to switch from their current payment methods.
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