I always liked when people talked about information coming from the “coal-face”. Having been a corporate functionary most of my career, I can say I love my time out in the field dealing with customers and partners; out on the face of the coal where everything actually happens. Since the beginning of January 2014, I have had the luxury of being out of the office almost every week, learning firsthand what is going on in the world of mobile banking. And it has been a fascinating seven weeks. The overriding sentiment is that mobile banking and the mobile channel in general are enabling community financial institutions the ability to dominate the mobile space while money-center banks are falling further and further behind. What an outstanding turn of events.
Cool As Mobile Shtuff. Actually, that acronym CAMS does not stand for “cool as mobile shtuff”. The second and fourth word were stated to me very differently, but my kids read this blog so I will leave out the profanity and let your mind drift to what the actual words are and what CAMS really stands for. But the sentiment of CAMS is very clear. Mobile has reached a stage of maturity where the features and functions are really, really cool. A very senior executive at one of the large core processors who exclusively focuses on community organizations, a “Diva” in his own rite, used that term with me at a recent dinner. “Robb,” he said. “Mobile banking is some cool as mobile shtuff.” The things we can do today, he went on to explain, are plain and simple cool, and financial institutions and their members and customers love them. We all agreed that mobile is fundamentally changing the way customers and members manage their finances and interact with their credit union or bank. With an average financial institution realizing growth of around 5% a month in their mobile channel, you can see how this statement is true–consumers are voting with their behavior.
Clean Mobile Money
The discussion then evolved a bit to the topic of the e-wallet. While we all believe e-wallets are in our medium-term future, imagine a new angle for selling the benefits of e-wallet. Not rapid settlement or convenience or a fee opportunity for the banks and credit unions, but clean money. What we discussed was how peoples’ recently developing paranoia around cleanliness and “germ-avoidance” actually supports the proposition of the e-wallet. I mean what is better than doing away with cash strictly on the basis of the fact that it is dirty and contains such a Petri-dish of germs? The common person who sterilizes their hand several times a day must be in fear of performing simple cash-based transactions. We decided that the e-wallet could be repositioned as the answer to this dilemma—clean-money. E-Wallets when they come will absolutely be embedded in the mobile banking apps of banks and credit unions. There will not be a single wallet, but there will be, like many payment-vehicles in the USA, a fractured infrastructure with community financial institutions absolutely playing a part in providing mobile-based payment services. So let’s further develop that theme of “clean-mobile-money” and maybe the somewhat slow development of the mobile-payments infrastructure can be accelerated.
My counter-part and partner, Danny Piangerelli, often blogs about security and how biometrics can play a role in further securing the mobile channel. Fingerprint scans, facial recognition possibly even eye-scanning may all play a part. But what about spittle? Imagine if you will, being able to “lick-in” that’s right, not “log-in” but “lick-in”. Just a small touch of your tongue to the main button on a smart-device and we can use your DNA to validate who you are. Now that has to be better than eyes and faces and fingerprints right??? What could be better than DNA-based authentication? I was recently with a senior banker who is convinced this is “WARRENted” and part of our future. Danny, get to work, as DNA authentication is coming. Yes, we are going to add fingerprint scans, at least once Apple opens an API to their newest feature on their newest phone. Yes, we have started to experiment with facial recognition. Both of those technologies are still a bit in our future so I ask again, why not spittle?
I have to add this one disclaimer. These ideas are not mine; they are from “the coal face”. Danny and I say it all the time. The best ideas come from our partners and customers. So we listen, and always politely endorse and encourage, as we love the input. It is honestly where all the great innovation comes from. So even in these somewhat non-traditional examples above, there are kernels of truth that will lead us to innovation and will lead community financial institutions to solutions that will continue to out innovate the money center banks. Long live community financial institutions in the race to be the best mobile providers.