What We’re Reading: Mobile Risks, Small Biz RDC and Facebook’s Online Bank Plans
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.
- Retail banks increasing their mobile investments
Responding to consumers’ growing interest in banking from their mobile devices, retail banks plan to invest more money to enhance their mobile offerings, according to a survey of Consumer Bankers Association members conducted by Forrester Research Inc. CBA members reported they will spend one-third of their total digital budget on the mobile channel this year. The joint research project surveyed digital executives at 19 leading U.S. and Canadian banks. The findings are summarized in a two-part report, “The State Of North American Retail Banking eBusiness 2012.”
- Tackling Emerging Mobile Risks
So how are banking institutions addressing mobile security risks? Keith Gordon, who oversees authentication and security strategies for Bank of America’s consumer online and mobile banking units, says most institutions are just now forging ahead in the mobile space, and new security gaps are areas for which they all must prepare, proactively.”Customers are now using their mobile phones much like they use their PCs,” Gordon says in an interview with Information Security Media Group’s Tracy Kitten (transcript below
- Why Small Business RDC Matters
Celent recently completed the analysis of some small business research among a random sampling of 500+ small business owners with annual revenues up to $2.5 million. The universe of U.S. SMBs excluding those making less than $50k/year is roughly 25 million. The research underscored the centrality of check payments among small businesses – like it or not. For example, 90% of responding SMBs accepted checks compared to 70% accepting cash, 33% credit cards, 31% debit and 28% PayPal (with large variations depending on type of business).
- New Metric For Buying Decisions
Aite Group has developed what it says is a better metric for calculating consumer likelihood to buy products and services from a bank or credit union than a broader business metric developed about a decade ago. Aite Group’s senior analyst Ron Shevlin has created something he calls the Referral Performance Score, which he says he’d like to see replace the Net Promoter Score. It’s based on this simple premise: those who actually take the time to refer their financial institution to others, or who expand their relationship with more products or services, are better indicators of potential new business than those who express only an intention to refer the institution or to deepen the relationship. The Net Promoter Score was invented by Fred Reichheld, a consultant for Bain & Co., who introduced it in a Harvard Business Review story in 2003. It uses a 10-point scale to calculate consumer likelihood to refer a company to family and friends.
- Mobile Payments, Online Bill Payment Usage Grows: IDC
Americans are fast adopting mobile payment services, but are more likely to buy physical goods than digital downloads. Mobile payments have more than doubled in popularity, reaching more than 33 percent of U.S. residents, according to the results of a report, “Business Strategy: Results from the 2012 Consumer Payments Survey” by IT research firm IDC’s Financial Insights division. More than half of those who made a mobile payment used PayPal Mobile (56 percent), with Amazon Payments and Apple’s iTunes service statistically tied at about 40 percent, according to the report. More respondents reported buying physical goods with their phones than online services, digital goods or virtual currency, despite the general popularity of digital downloads, such as applications and music, the report noted.
- Facebook wants to be your online bank
The social media giant is quietly supporting new services for banks that want to engage socially with their customers: The decidedly unsocial business of online banking. Someday soon, Facebook users may pay their utility bills, balance their checkbooks, and transfer money at the same time they upload vacation photos to the site for friends to see. Sure, the core mission of the social media network is to make the world more connected by helping people share their lives. But Facebook knows people want to keep some things — banking, for example — private. And it wants to support those services too.