What We’re Reading: Mobile Banking, P2P Payments and Digital Wallets
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.
- Basel Adds Another Reason to Avoid Construction Loans
Community banks have yet another incentive to avoid returning to construction lending despite the lure of charging higher rates for such loans. Tougher capital rules proposed by the Basel Committee on Banking Supervision will throw a bucket of cold water on any notion of making higher-risk construction loans, says Jonathan Hightower, a banking lawyer at Bryan Cave. He says a proposal for placing a higher risk-weighting on certain types of construction and commercial real estate loans could scare off many banks. Construction loans have long been a vital component of small banks’ plans for returning to profit growth.
- Mobile Banking Spend on the Rise
Retail banks are planning to invest heavily in mobile due to increasing customer demand, according to a new report from Cambridge, Mass.-based Forrester Research. Forrester surveyed members of the Consumer Bankers Association (CBA), who reported that they will spend one-third of their total digital budget on the mobile channel this year. The joint research project with the CBA’s emerging channels committee surveyed digital executives at 19 leading U.S. and Canadian banks. The findings were summarized in a two-part report, “The State Of North American Retail Banking eBusiness 2012.”
- FIS to sell healthcare benefits business for $335M
Fidelity National Information Services Inc. said Monday that it reached a deal to sell its healthcare benefits business to investment firm Lightyear Capital for $335 million in cash. Jacksonville, Fla.-based FIS, which provides software and services for banks and other financial companies and operates the NYCE debit payments network, said the sale is expected to close by Sept. 30, subject to regulatory approvals and customary closing conditions. The sale includes FIS’ consumer-focused healthcare and health and financial network businesses, which provide benefits administration, debit card and benefit account processing and payment services to consumers, healthcare providers and payers, the company said. The business generated about $120 million in revenue and 5 cents per share in adjusted earnings per share in 2011, the company said.
- 3 Big Banks Team Up To Launch A P2P Juggernaut
A new product from the clearXchange joint venture of Wells Fargo, Bank of America and JPMorgan Chase may rattle the highly competitive person-to-person payments market. Send and Receive Money, which recently went into production, is pretty much just what it says, and given the considerable size of its backers (38% of banked consumers), should have plenty of reach. It allows Wells Fargo and Bank of America customers to send and receive funds transfers from other customers by using an email address or mobile phone number. Although the free service is driven by clearXchange, consumers will use it by registering on their existing online banking or mobile apps with Wells Fargo or Bank of America.
- Tablet Interest Builds in Next Phase of Mobile Usage
The use cases of phones versus tablets are dramatically different, said John Flora, a spokesperson with Intuit Financial Services. The company has sold some 200 iPad apps, mainly to credit unions, and more deals are in the pipeline. “Tablet deployment is just at the beginning,” Flora said. As for those differences, Flora noticed that smartphone usage is “one handed, tablets are two. With tablets, the user is sitting on a couch, or lying in bed, and spending more time on the device.”
- HTML 5: Why Should You Care?
As the latest release of the HTML specification, HTML5 has the potential to profoundly change the way financial institutions market and deliver their products online. What makes it worth investigating and adopting as a development toolset? Why should we push our providers to develop the next generation of solutions using this specification? What does this mean for FIs? Companies like The Financial Times and The Boston Globe that have made the move to an HTML5 private utility app did so with these goals in mind: A shortened release window.
- Your digital wallet; Paying for everyday things with phone apps
The growing crop of digital wallet offerings is making it easy to pay for a variety of everyday things with just a few phone taps. Smartphone apps usually email you an electronic receipt, so no more crumpled wads at the bottom of your purse or pocket. But watch out: Once you start paying with your phone, it may be hard to go back to pen, paper and plastic. Many online banks have smartphone apps that will let you check your balance and purchase history, as well as transfer funds between accounts. Apps from banks such as Chase and ING also allow customers to deposit funds by using a phone’s camera to snap a picture of a personal check.
- New bank theft software hits three continents –researchers
A new wave of automated hacking of online bank accounts might have stolen $78 million in the past year from customers in Europe, Latin America and the United States, according to researchers who peered into the computers of the hacking gangs. The groups used recent improvements to two families of existing malicious software, known as Zeus and SpyEye, which lodged on the computers of clients at 60 banks. While previous versions of the software have proved adept at stealing logon information, the latest variants automate the subsequent transfer of funds to accounts controlled by accomplices. The findings, to be released on Tuesday by security firms McAfee and Guardian Analytics, confirmed and expanded on research from Japan-based Trend Micro Inc that was first reported last week by Reuters.