What We’re Reading
Below are interesting stories the Banking.com staff has been reading over the past week. What have you been reading? Let us know in the comments section below.
- Online banking—it’s so 1998
Online banking, once state of the art, has failed to keep up with the times. Banks in general are missing out on new revenue and cost-cutting opportunities, concludes a recent report from Celent Inc. “The online banking space has stagnated for far too long. The evolution of the internet has provided consumers with rich and interactive experiences online. Unfortunately, the banking industry has not kept pace with the evolution of the internet, and customers have started to demand that their banks keep up with the times,” says the report, “Top Trends in Retail Online Banking.”
- Bank Claims a Lift from Social Media
National Australia Bank said its new social media “break up” campaign has led to an increase of one point in mortgage share in just a couple of months with minimal cost. National Australia Bank, which has found itself repeatedly explaining and covering for batch processing-driven glitches in its payments and other IT systems over the past year, had some good tech news to report last week. Its microsite attacked its rivals, saying the bank was “breaking up” with them over presumably higher interest rates. The bank used Twitter, Facebook and YouTube to spread its adversarial message, gaining both buzz and followers.
- Debit Reward Plans: Slim Bank Benefit
When Congress threatened to cap the interchange fees that banks collect on debit card transactions, the industry argued that such a move would force it to kill off its own debit rewards programs. As it turns out, the demise of those programs might inconvenience consumers but it is unlikely to deal banks much of a financial blow. A bank that offers a rewards program typically earns a gross profit of $73 per active debit card per year. That compares with $63 for each account that offers no rewards, according to data from Aite Group LLC.
- Branch of the Future: Getting there from Here
Multichannel is more than a buzzword, it’s a way of life in retail financial services. With consumers increasingly using a growing array of self-service channels to interact with their financial institutions, many banks are struggling with creating and implementing a vision for their most expensive channel – the branch network. How to address these challenges given today’s capital constraints and multiple other pressing priorities can be vexing. These challenges are going to be discussed in detail on June 16th at the Celent Innovation and Insight Day.
- NFC mobile payments could hit $50 billion by 2014
Consumers around the world could generate as much as $50 billion in sales through NFC-based mobile payments by 2014, according to a report released yesterday by Juniper Research.NFC, or near-field communication, lets consumers pay for goods and services on the go through their mobile phones simply by touching or passing them over another NFC-equipped device such as a register or terminal. The funds themselves are transferred from the user’s credit card account stored through the mobile phone. Google recently announced its own mobile payments service called Google Wallet that would let owners of NFC-enabled Android smartphones pay for items from participating merchants.
- Electronic banking is the wave of the future
Electronic banking is here to stay. Whether it’s direct deposits of paychecks or paying bills online, electronic banking is the future. I have no doubt that in the near future companies will no longer accept checks for payments. They will require you to make an electronic payment. Therefore, the sooner you take advantage of electronic banking, the better it will be for you.
- New Financial Rules Delayed
U.S. regulators, behind schedule in finalizing key rules mandated by last year’s financial-regulatory overhaul, agreed to delay a host of new requirements scheduled to hit the $600 trillion derivatives market next month. The move offers temporary relief to banks, companies and investors who have worried their use of derivatives—sometimes-complex financial products used to hedge risk or speculate for profit—could run afoul of regulation. Certain parts of the Dodd-Frank financial law automatically take effect July 16, though regulators have yet to issue final rules in affected areas. On Tuesday, the Commodity Futures Trading Commission offered a six-month reprieve.