Social Media Isn’t Just a Trend Anymore, It’s a Reality

Social Media was blasted across a smattering of 2011 predictions and remains a concern for businesses everywhere. The Internet and webinars are awash with insight on social media and easy how-to’s:  how to use social media, how to find the best tools, how to measure it, among thousands of others.

However the banking industry, always quick to adapt to new technology, hesitates when it comes to social media even when statistics demand it as an integral part of any business plan. American Banker reports that  while banking’s focus on capturing the attention of Gen Y users should naturally drive financial institutions to platforms like Twitter and Facebook, the most rapidly growing demographic on Facebook is women 55 to 65. With social media capturing a large portion of any bank’s customer base, institutions should reevaluate their stance towards social networking platforms for,  as noted by Christopher Van Slyke, partner and co-founder of Trovena LLC, “it’s not what you know, it’s who you know.”

A Visible Banking article gleans that the hesitation from the financial industry to adopt social media efforts may be due to several campaigns that were deemed unsuccessful. However, the article claims that these social media efforts may not have been promoted properly.  The article also highlights eight categories for smart and easy ways to give your financial institution more visibility including cross promotion, shareable site content and a social media page on the bank website.

What social media efforts are you using to reach your customers? How are you promoting these efforts? Let us know in the comments below.


FDIC Outlines Top 10 Online Resources for Consumers

This week, theFederal Deposit Insurance Corporation (FDIC) honored National Consumer Protection Week by sharing 10 online resources to keep consumers safe while managing their finances. In an era where “Googling” reliable information is standard, the FDIC wants to ensure that consumers are getting practical and dependable tips to help avoid fraud while managing their bank accounts.

A few of the resources offered by the FDIC include:

  • Bank Find: Our online directory that consumers can use to locate an FDIC-insured institution, learn what happened to a bank that changed names or no longer exists, and more.
  • Small Business Web Page: Useful information for small businesses, especially regarding access to loans, plus an online form to ask the FDIC a question or register a concern.
  • Foreclosure Prevention Toolkit: A Web page that provides easy access to helpful information for homeowners on avoiding foreclosure and foreclosure “rescue” scams.

To read the remainder of the tips, visit the FDIC.

What does your FI do to inform customers about the danger of online fraud? Let us know in the comments section below.

What We’re Reading This Week

Below are interesting stories the staff has been reading over the past week. What have you been reading? Let us know in the comments section below.

  • Card Issuers Battling Fraud with Limited Resources

American Banker

Credit and debit card fraud leads other types of fraud at most U.S. banks and credit unions, but most institutions are fighting such activity under constrained resources, according to a survey. Data released by ISMG Corp.’s showed that banks have teams averaging one to five workers, regardless of the institution’s size, focused on fraud activity. The findings were released at the BAI Payments Connect conference here on Monday. Seventy-two percent of the 255 institutions surveyed online in October said they had credit or debit card fraud within the previous 12 months, followed by ATM fraud, 41%, and fraud conducted through automated clearing house channels, 30%. Also, fraud initiated from insiders or employees, wire fraud and other types of payment fraud were each cited by 20% of the institutions.

Read more


  • Making a Bad Business Case Worse: Dodd Franck and Mobile NFC

Celent Banking Blog

Celent keeps hearing that mobile payments are coming, but to date there has been more light than heat. Why is this? In a previous Celent report, The View from the Mobile NFC Finish Line: Bank Economics in a Mature Mobile NFC Payments World, September 2009, Celent made the case that NFC payments were not in the interest of the established players. Where does Celent see an opportunity for mobile NFC? In closed loop retail payment systems.

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  • Where Are You Investing Technology Dollars?

Credit Union Journal

Credit Union Journal asked attendees of NAFCU’s Technology & Security Conference here where their CUs will be investing their technology dollars in 2011, and why.  Lewis Terry, VP of information systems, Fort Bragg FCU, Fayetteville, N.C. says, “The first thing we are looking into is finding a partner to manage our third-party vendors for us. Second, we are updating our disaster recovery service. Also, we are starting to replace some of our older ATMs with ADA-compliant [Americans With Disabilities Act] ATMs.”

Read more


  • Durbin: A Consumer-Friendly Regulation?

Javelin Strategy & Research Blog

As the regulatory environment in the U.S. continues to evolve, payment services providers are being challenged to sustain revenue by developing new approaches to products and services, accounts and fee structures. At the same time, merchants are likely to see significant reductions in payments acceptance costs for some forms of payment. The implications of regulations on financial institution practices are also unlikely to favor consumers. The combination of Durbin with other regulations is causing many banks to reassess their revenue models for DDA accounts, payments services, rewards and for other products, services and features

Read more

  • Debit Card Fees Prompt a Push Near Deadline

New York Times

Without much warning or debate, the Senate passed an amendment directing the Federal Reserve to reduce the hidden “swipe fees” that banks collect from retailers each time a customer makes a purchase with a debit card. Now, as the Fed faces a deadline in April to write the rules for the lower fees, banks and debit card companies are engaged in an all-out assault on Capitol Hill, enlisting a growing cadre of lawmakers and lobbyists to push for changes, delay or outright repeal. Banks contend the proposed cut in fees — to 12 cents per transaction from an average of 44 cents — will leave many of them unable to afford to issue debit cards to customers or will force them to raise other consumer banking charges to cover the costs. They also claim retailers will reap unfair profits.

Read more

  • Which banks and credit unions still offer free checking?

The Oregonian

Big banks are tacking on fees and conditions, but some smaller competitors are ready to pick up the check. Plenty of financial institutions still offer free, no-frills checking. But increasingly, they’re taking away perks or charging for other services. Some institutions refrain from promoting their free products. They say they’re still not sure they can provide it until new rules on debit-card fees become clear.

Read more

Checking In? Ka-ching!

Credit card company American Express has teamed with location-based service Foursquare to allow users to win prizes and meet people by using their mobile devices to “check in” at their favorite places.

With Gen Y users showing noticeable interest in mobile applications, the partnership allows American Express to win over these younger consumers, and proves larger companies are starting to seriously consider entering the mobile space.

With Facebook and Twitter strongly cemented as the top two social services, Foursquare is looking to quickly close the gap.

Are your customers “checking in?” Have you considered offering incentives for those using Foursquare at branches? Let us know in the comments below.

A Bouncing Debit Card?

While many consumers enjoy the benefits and convenience of debit cards, some banks across the country are beginning to consider allowing debit cards to “bounce” – similar to how a check would not clear.

According to the Wall Street Journal, with new rules and regulation in place, banks are now restricted on how much they can charge merchants for debit transactions, with the end result being a loss of billions in revenue.

Some are considering dividing debit services into components and charging for each separately, at the cost of the merchant. This turns the table on retailers, who according to the post, “won a significant victory with the enactment of debit-transaction fee limits.”

Is your institution considering allowing debit cards to “bounce?” Leave us a comment below.

What We’re Reading This Week


Below are interesting stories the staff has been reading over the past week. What have you been reading? Let us know in the comments section below.

  • Who Says Prepaid Cards Are Only for the Unbanked?

American Banker

Prevailing wisdom holds that prepaid cards are an alternative or, at best, a bridge to a bank account, not an overlapping product. But Fuze Network Inc. says there is enough overlap today that consumers can use a bank’s online bill-payment software to load funds to prepaid card accounts. Fuze works from the premise that many consumers both use prepaid cards and have bank accounts. That contradicts the common thinking that most prepaid card users are unbanked, meaning they do not use mainstream banking services either by choice or because of financial hurdles. In a survey that Mercator conducted last May, 8% of the 1,009 respondents said they had purchased a general-purpose reloadable card in the previous 12 months.

Read more

  • Issuers Look to Promote Small On-Time Payments

American Banker

TD Bank has launched a credit card for customers who are responsible, but not too responsible. It rewards customers for paying on time, but not in full — the incentive for an on-time payment is a reduction in the interest rate for carried balances. Similarly, Capital One Financial Corp. has a new card rewarding students for on-time payments, but imposes strict, low credit limits. A number of credit cards rewarding consumers for more responsible financial behavior have been rolled out since the financial crisis as issuers seek to woo back potentially credit-wary customers with strategies that hedge risk on both sides. “Banks are trying to figure out how to expand their universe of customers,” said Judy Cohen, vice president at EMI Strategic Marketing.

Read more


  • Point, Click, Capture: Credit Unions Should Race to Offer Mobile RDC

Credit Union Times

Most analysts and experts agree 2011 is the year mobile capture goes mainstream. In fact, Andrew Tilbury predicts within two years this service offering will be as ubiquitous as online banking and bill pay. FI members will demand it, and statistics demonstrate that some members will even go so far as to switch financial institutions if the service isn’t offered at their current institution. A few early adopters launched the service in 2010, but the race has officially begun for the rest of the country. Tilbury assures, that financial institutions’’ competition is at the very least evaluating mobile capture. The question is not if your institution should offer mobile capture–but rather how quickly?

Read more


  • BankSimple Wants to Shake Up Banking, With Cutting Edge UI Design

Fast Company Design

The founders of a startup called BankSimple have the same gripes as author John Pavlus (although perhaps not as vituperatively expressed). “Most people have a horrible relationship with their banks,” says Alex Payne, BankSimple’s co-Founder and Chief Product & Technology Officer [pictured above]. “We wanted to make the experience a lot more human.” BankSimple’s creative director, Bill DeRouchey, puts a finer point on it: “We’re focused exclusively on the user experience of banking.” Besides a host of up-to-date technology running under the hood, Payne and DeRouchey are mainly betting on good design itself to entice customers to ditch the Chases and Bank Of Americas of the world.

Read more

  • Credit Card Data Tells Mixed Story

New York Times

While the average debt on credit cards in December decreased by 4 percent compared with the same month a year before, Americans still carried an average of $4,284 on credit card statements in December 2010, according to data released this week by the credit monitoring company Experian. The data offers conflicting versions of the economy’s already mixed picture. While some consumers spent more during the holidays because the economy was rebounding, others were still unable to cover expenses without leaning on their credit cards. And while holiday spending also appeared to have been more robust than in the last several years, even more recent data has shown a bit of a slowdown in consumption this year.

Read more


  • Checking Will Stay Free, Says PNC Bank

Wall Street Journal

PNC Financial Services Group Inc., bucking a trend that is sweeping the banking industry, is vowing to keep its most-basic checking accounts free of fees. The Pittsburgh-based regional bank on Tuesday is expected to start notifying its five million checking customers of changes to some of its accounts, which won’t include any new fees. But the free checking comes at the price of other perks: Basic accounts will no longer enjoy debit-card rewards, and non-PNC automatic-teller-machine fees will no longer be reimbursed. PNC has estimated it could lose $800 million a year from the new rule, which is set to kick in this July. Bank of America Corp. and J.P. Morgan Chase & Co. are among the banks that have put free checking on the chopping block and are testing a slew of new accounts around the country.

Read more

Ask And Ye Shall Receive

Editor’s Note: Gene Marks is a small business management columnist, author, and speaker who also owns and operates The Marks Group PC, a highly successful 10-person firm that provides technology and consulting services to small and medium sized businesses. The Marks Group PC, launched in 2004, has grown to help more than 500 companies and more than 2,000 individuals throughout the country. Gene writes weekly online columns for The New York Times and Forbes, as well as monthly and bi-weekly columns for Bloomberg Business Week and American City Business Journals. Intuit has, on several occasions, contracted Gene to provide marketing-related services.

Ask And Ye Shall Receive

As a business owner, I was never one for asking for a lower price…until I found myself getting lower prices by asking.

Your better customers know that the reality of doing business today is this: everyone’s got a price. If someone told me to shed my clothes and go streaking across Lincoln Financial Field on a January Sunday I’d turn up my nose and sniff: “Hmmph, exactly what kind of a sick, depraved animal do you think I am?”

But suppose I was offered a million bucks to do that (and saw the cash)? Depravity…here I come!

So just watch me rationalize. “Welllll,” I’d think aloud. “It’s only for a few minutes, isn’t it? And it’s not like I’d be on national TV, right? And I’d only potentially serve a few months in prison at most. And even my wife agrees that it’s really, REALLY not a big deal at all (if you get my drift).

It may not be the same topic, but this rationalization is shared by most other salespeople when asked to lower their price. The point is….everyone has a price. As a banker and advisor to your customers you should remind them that they should always be pushing for the lowest price possible by asking, asking, asking.

For example, you’re meeting at your customer’s offices and just at that moment he’s in the middle of trying to purchase a bunch of raw materials he needs to process for a big order coming in. He’s complaining to you because his supplier’s price is too high. As his banker, it’s in your best interest that he makes the best deal possible too! So give him some advice. Tell him to ask for a lower price. Because, guess what? The supplier wants the business as much as your customer needs the materials. We all need more business.  Whatever’s being asked is usually just the opening bid. Tell him that chances are the price can come down a bit. Multiply that bit times lots of pounds (or whatever the units are) over a period of time and this adds up.

Another story: My wife (who also happens to be the world’s best negotiator) got two bids to have our living room floors re-done. And of course the higher bid came from the company she liked better. Did she pay it? I think you know the answer. She just said she couldn’t. She needed a lower price. At least something comparable to the other company. She just…asked. And her favored contractor conceded.

Your customer needs to be reminded that he should always be asking for the lower price. Why? Because that’s what his customers are doing to him every day, aren’t they? I find it incredulous, shocking, outrageous and downright insulting when, after clearly stating our hourly fee, a client asks for it to be lowered. How dare they! And of course…I usually lower it. Why? You know why. I want the work. I don’t want my competitor to get the business.  I’d probably throw in a personal car wash to get the business. Don’t look at me that way. You’re no different!

Encourage customers not to be afraid to ask for a discount. No one expects to negotiate a treaty with North Korea or haggle like an experienced merchant in a Turkish bazaar. But not paying top price is what being a profitable business owner is all about. Tell him: Just because you can afford the price doesn’t mean you have to pay the price.

Ask. You will receive.

By Gene Marks

FI Spotlight: Firstmark Credit Union Climbs to the Clouds


Texas based Firstmark Credit Union realizes that “cloud” isn’t just a buzzword. The financial institution recently deployed a Software-as-a-Service solution to assist in the management of web and print communications for the credit union and its 10 branches. Prior to adopting cloud services, Firstmark was using massive spreadsheets for project management, which are cumbersome when being transferred and collaborated on through multiple operating systems.

Todd Lanier, Firstmark’s web communications manager, stated in a Credit Union Times article that the cloud computing service has “already yielded useful, actionable information. We were able to see that members were most interested in getting into their accounts to perform a transaction and weren’t very interested in other stuff, so we’ve streamlined things in that regard.”

Read the full article here.

Do you see your financial institution using cloud computing solutions in the near future? Do you already? Let us know in the comments below.

The New Faces of Credit Card Marketing Campaigns

Banking executives have evaluated countless marketing campaigns to deploy each year to build trust and lasting relationships amongst existing customer bases and attract new customers. But what about evaluating the use of celebrities to build stronger relationships within ethnic communities? This is the focus of a recent American Banker article that examines how top credit card companies like MasterCard and Visa are leveraging celebrities to do just that.

So what celebrities have been brought into the fold? American Banker’s Andrew McKenna writes that Chris Gardner, whose life was played out on the silver screen by Will Smith in “The Pursuit of Happyness,” was tapped to begin conducting financial education seminars in African American communities throughout the country. Visa began using Mexican Soccer Star Claudio Suarez to MC financial literacy programs throughout the Hispanic community.

Why are companies taking these steps to build better relations to try and earn the trust of these customer segments? According to McKenna’s article, “Hispanics are 40 percent likelier than non-Hispanics to be uncomfortable entrusting their money to a bank, and more than a third of Hispanics in the U.S. pay bills with cash only, according to Mintel research.”

However, this is not the first effort credit card companies have made to engage with multicultural communities. McKenna references MasterCard’s efforts two years ago to create a partnership with Spanish media company, Univision, spurring a new Univision MasterCard pre-paid card.

Is your FI participating in any similar programs? Leave us a comment below.

Debit Card Fees: A Break For Small Banks?

Debit cards, while a seemingly easy source of payment for consumers, can be a costly add-on for merchants due to charges put in place by the debit-card issuers: banks and credit unions.

Although a hindrance for some merchants, banks and credit unions view these charges as an important part of their business model. Currently, there are heated debates among lawmakers and bankers alike about the pros and cons of debit card fee limits, especially for smaller banks and credit unions. A new provision recently proposed in the Dodd-Frank legislature suggested capping “swipe fees,” but that financial institutions with less than $10 billion in assets would be exempt. Call it the “small-bank exemption.”

In December, the Federal Reserve issued a draft rule capping fees that banks charge at 12 cents per transactions, which is much lower than the average 44 cents banks currently charge. Banks argue that the significant drop in transaction fee will not cover what debit cards cost them, which in turn will cause them to charge higher account fees to consumers.

The Wall Street Journal reported on the issue, quoting Federal Reserve Chairman Ben Bernanke, “there are two reasons why the small-bank exemption may not work. Merchants may choose to refuse to accept higher-fee cards from smaller banks. Or, payment networks such as those run by Visa Inc. and MasterCard Inc. may decide that it doesn’t make financial sense for them to have a two-tier system.”

So what are outside credit card companies and merchants saying? As noted by the Journal, “The National Retail Federation, which backs the provision, said the rules imposed by Visa and MasterCard bar them from picking and choosing which cards they accept based on issuer. Critics of the rule contend that there’s no way to police what each individual small-business owner does.”

What do you think about the small-bank exemption? Let us know in the comments section below.