What We’re Reading: Big Data, Tablet Banking and the Mobile Pay Market
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 or Tweet @bankingdotcom.
- Student Lending Market ‘Too Big to Fail’: CFPB Official
Total outstanding student loans in the U.S. have grown to the point of having potential far-reaching effects on the financial system, an official from the Consumer Financial Protection Bureau told bankers this past week. Following his announcement that student-loan debt has topped $1 trillion, Rohit Chopra, the CFPB’s student loan ombudsman, said the market was now larger than previous estimates. Chopra said the increasing debt, mostly from federal student loans, could hamper the housing market recovery in the near term, and have long-lasting effects on other bank products. (The bureau’s estimates of total student loan debt came from a joint study with the Department of Education.)
- With Eye on U.S. Mobile Pay Market, Monitise to Merge with Clairmail
Seeing a major opportunity in the U.S. market, Monitise and Clairmail this morning announced a merger deal in which they will cross-polinate and cross-sell each other’s technology in their respective markets. Assuming the deal goes through, the two companies will have 33% of the top 50 U.S. banks as customers and a total of 300 bank customers. The two companies would have pro-forma combined revenues of $56 million at the end of 2011.Both companies’ executives stressed their philosophy of keeping banks at the heart of mobile payment and mobile commerce transactions.
- Big Data or Big Hassle? New SAS Tool Offers Simplicity
Banks have long struggled to make sense of the oceans of data they produce. They can buy tools to help mine, analyze and structure really big amounts of data, but until now, these products have not been very user-friendly, limiting their appeal. One of the latest data discovery products, announced Thursday by SAS Institute, promises to let non-IT folks in banks do complex big data modeling from their own computers. Data discovery products typically rely on an in-memory middleware layer that can pull and temporarily store massive amounts of data quickly. With its SAS Visual Analytics product, “we can have the modelers [at banks] who used to build one model a day, because it took so long, build a model every 15 minutes,” says James Goodnight, the Cary, N.C., company’s chief executive.
- Tablets Hold Game-Changing Implications for Banks
It’s fitting that Bank Systems & Technology closed the April 2012 digital issue covering the evolution of mobile technology in the banking industry the same week that Apple introduced the “new iPad.” The updated version of the tablet (which is not being called the iPad 3 even though it is the third edition of the device) includes an improved screen and enhanced cellular networking capabilities, as well as a faster processor. Perhaps more noteworthy than these upgrades, though, was CEO Tim Cook’s announcement that Apple sold 15.5 million iPads in the past year — more than the number of PCs sold by any of Apple’s competitors. BS&T’s April digital issue breaks down what it takes to create a superior tablet banking experience and highlights some of the industry’s top iPad apps.
- Mobile Remote Deposit Capture: Putting a Price on Convenience
Banking customers increasingly see value in mobile remote deposit capture (RDC). In fact, in many cases, they would even change banks to get the service, according to the Mobile Financial Services Tracking Survey, a semiannual survey conducted by Boston-based consulting firm AlixPartners. At the end of 2011, 65 percent of the survey participants who indicated that they were “at least somewhat likely” to switch banks for mobile services said that the ability to deposit a check with their mobile devices would be the main reason for the switch — a 50 percent increase over the second-quarter 2011 survey results. Banks are scrambling to meet this rapidly growing customer demand for mobile RDC.
- Mobile Bill Pay Gaining Global Traction
A recent report from British research company Juniper Research has found that mobile bill payment is quickly gaining global acceptance and will continue to see significant growth. The report, titled “Mobile Banking for Developed and Developing Markets”, predicts that by 2016, more than 80 percent of mobile banking customers will pay their bills with their mobile device. It also says that users of transactional mobile banking services will grow to more than 550 million in 2016 from 185 million in 2011. The report indicates that mobile bill pay adoption rates are highest in customers who have access to “triple play” mobile banking solutions that include an SMS or text option, a mobile web browser and a downloadable application. In addition, it says that transaction frequency is highest in developing regions where users don’t have many other options for bill pay beyond using a mobile device.
- Using PFM To Be PFI
Texas-Big banks are playing the PFM game to steal business from CUs.The game goes something like this: the bank offers personal financial management (PFM) software to the customer, the customer tracks external accounts in the software, including CU accounts. Then, the bank peeks into the external account data in order to identify products and rates to beat.”Bank of America is sending your members referrals that say they can give a loan at a lesser rate,” suggested Kevin Scott, COO at $97-million Texoma CU here. “Your member is being actively marketed by other financial institutions from PFM info.”
- Fraud Ring Busted in Washington State Using Tech Tools
Portland, Ore.-based online fraud detection company iovation helped police in Kirkland, Wash., bust up a fraud ring that involved thousands of dollars in fraudulent credit card charges, the company announced. Police used ReputationManager 360, iovation’s online fraud prevention solution, to identify and track the fraudulent charges that targeted at least 15 people, the company said. ReputationManager 360 tracks electronic devices including computers, tablets and cell phones and identifies fraudulent online activities by making associations between devices and individuals. “This is a unique case because it wasn’t exclusively an online or offline crime,” said Kirkland police Detective Adam Haas.
- Digital Wallets – It could be an all or nothing argument for adoption
On March 6, 2012 Apple was granted a new patent for a technology they are calling iWallet. Looking at the proposed functionality Apple has once again done what they do best; enter the market after the innovators (think GoogleWallet) with, in his opinion, a substantially better offering. Better in that it goes beyond simple payments to allow you to take control of your payment cards directly on your iPhone. Meaning you will be able to get statements, balances other information and transactions beyond simple point of sale transactions.