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.

Avoid Danger in the Waters, Prevent Mobile Banking Scares

Mobile banking is pervading the financial world helping consumers more efficiently manage their finances.  However, the fears consumers harbor with respect to the security of their finances easily translates to the mobile channel.

Over a year ago, Android phone users downloaded mobile banking apps from an unknown developer, 09Droid. The apps, which boasted connectivity to large banks, such as Bank of America and Wells Fargo, were never created, hosted, or sponsored by their respective institutions.  Luckily, the fraud was discovered and the apps were removed from the Android App Market.

With consumers wary of a variety of security issues regarding their financial data, it is important to provide them with tips to stay safe, and secure their faith in your financial institution’s mobile banking offerings. A CreditCards.com post describes the following tips for consumers to stay safe before and after going mobile:

Before Going Mobile

1. Consider the app store

2. Check out the source

3. See what others are saying

4. Try a bookmark instead

You can read the full post, including tips after going mobile here.

While some consumers may seem to be overly cautious, it is more important to direct your customers to the correct, secure banking options to ensure increasing mobile adoption.

How do you assure customers that they are banking safely across a variety of financial tools?  Let us know in the comments below.

Are Your Ideas Organic?

Forrester’s Kerry Bodine recently blogged about how Apple has affected consumers in significant ways – from what we buy and how we work – but most importantly, how we measure good design. Bodine noted that Apple has raised awareness around simplicity and attention to detail, and that customer experience professionals at other companies are beginning to take notice.

When it comes to financial services, Bodine mentioned she was fascinated by the number of companies outside of the consumer electronics industry that seem set on copying Apple. She also noted the “dangers” of un-organic ideas, including:

  • “The experience you create will not be aligned with your brand.”
  • “The experience will be one dimensional — and set the wrong expectations for customers.”

Are you your own leader? What defines your brand and customer experience? Let us know in the comments below.

Don’t Give Customers a Reason to Look Elsewhere

In all the frenzy of this past Holiday season, you may have overlooked Apryl Motley’s piece on “Smarter Service” in the December 2010 Independent Banker; it’s definitely worth a read.  Consumers today expect more from their community banks than ever before, and they want a lot of added value in the services they get. Motley stresses that a multichannel approach to user-driven technology (many of which a bank already deploys across its many operations) can help retain and cross-sell customers.

She emphasizes four key channels of customer engagement as prime examples:  integrated voice recognition systems (IVRs); ATMs; microsites; and online personal financial management tools – and Motley stresses that the bank needs to better integrate and coordinate these services to enhance the customer experience.  For example:

Presenting a Stronger Voice: Believe it or not, voice is still among the most powerful channels. With the integration of IVRs, telephone banking systems and core banking systems, customers can make deposits at the ATM and then call to verify those deposits.

Personalized ATM Service: Along with valuable information, what customers want most are high levels of speed and service, and they don’t want to sacrifice one to get the other. Smarter technology is enabling ATMs to “listen” to a bank’s customers.

Making the Most of Microsites: Stand-alone microsites (like Savehardspendsmart.com, launched by $11B Umpqua Bank in Roseberg, OR) are mini-websites that provide targeted interactive news and resources on a particular topic, product or service – customers want to rely on their bank as a trusted resource for important information.

Show Them Their Money: The ability to give customers insights about their finances without them having to do much work is driving customer adoption of online personal financial management tools; some banks are revisiting the integration of online banking and PFM applications so that customers have to log in only once to get access to a “hub for managing their accounts.”

What are you doing to coordinate your channels of customer engagement? We’d like to hear.

Improving Online Services

In an increasingly online world, financial institutions are faced with bringing customer service online via multiple channels. While support lines and e-mails can suffice for some, some social media savvy consumers turn to Facebook or Twitter to find their financial institution.

In a recent SearchCRM.com article, Sue Hildreth examines customers’ behaviors in the financial marketplace. Hildreth sites statistics from Intuit Financial Services, IDC, Finextra Research and Pegasystems, noting that an online experience is becoming a valued resource to customers. During a poor economy, having reliable customer service in the banking industry has been crucial. As people refinance homes, shift stocks and deal with overdrawn accounts, having a customer representative, rather than an automated phone system, is paving the way for a new wave of customer service.

Hildreth writes:

“Kate Leggett, senior analyst at Forrester Research Inc. and a leading expert on CRM, believes that banks and other financial services firms will want to integrate their CRM Web offerings into a corporate Facebook page so that customers don’t have to jump between the two sites but can get the same, consistent online Web services at either place.”We see some companies — though not yet many banks — offering customer service on Facebook. They can engage with customer service staff directly, through click to chat, or they can browse the knowledge base,” Leggett said. “I believe it is the next wave.”

Is your FI connecting with customers via Facebook and Twitter?  Let us know in the comments section below.

FI Spotlight: Provident CU

Provident Credit Union Prepares for 2011

Despite the economic challenges of 2010, Provident CU’s CEO Wayne Bunker details the credit union’s preparation for 2011 by adding a variety of e-services, Website improvements and personal financial management in the form of FinanceWorks.

Remote check deposits and financial seminars top Bunker’s list of added convenience for the Provident CU customer in the new year.

Read the full message from the CEO here.

How has your financial institution prepared for a bright 2011? Leave us a comment below.

Social Media Statistics: By-the-Numbers, January 2011 (Part II)

Below are interesting statistics on social media usage. Feel free to share your favorite social media statistics in the comments section.

  • 30 billion pieces of content (e.g., links, photos, notes) are shared on Facebook each month (Source: Royal Pingdom)
  • 25 billion tweets were sent on Twitter in 2010 (Source: Royal Pingdom)
  • 200 million views of YouTube via mobile per day (Source: Google)
  • 152 million blogs on the Internet at the end of 2010 (Source: Royal Pingdom)
  • 100 million new accounts added on Twitter in 2010 (Source: Royal Pingdom)
  • 53% of American Internet users look for information on Wikipedia, up from 36 percent in 2007 (Source: Pew Internet)
  • 50% of U.S. CMOs at Fortune 1,000 companies said they launched a corporate blog because “it’s the cost of doing business today” (Source: eMarketer)
  • $3.08 billion will be spent to advertise on social networking sites in 2011, a 55 percent increase over 2010 (Source: eMarketer)
  • 200 million registereed accounts on Twitter as of January 2011 (Source: Twitter)
  • 110 million tweets are sent per day on Twitter (Source: Twitter)
  • 27.5 million ‘stumbles’ on content discovery site StumbleUpon in one day, a new all time record (Source: StumbleUpon)
  • 65% of U.S. adults use social media and say they have received a positive benefit as a result (Source: Harris Interactive)

Consumers Use Mobile Devices to Call Toll Free

A recent IDC Financial Insights survey found respondents interact with their financial institution using their mobile device, however not for the reasons many may think.

The majority of respondents used their mobile device to call into their bank’s toll-free number. The breakdown can be seen in the graph below:

With new statistics surfacing every day surrounding mobile banking, the IDC survey showed consumers primarily use their mobile devices to make phone calls. The data also indicated age was not a huge factor when determining whether an individual dialed toll-free – across all demographics, the toll-free number was the preferred way to interact with their financial institution using a mobile device.

Additional insight on the survey can be found here. Are you remembering to think of all the possible channels to reach your customers, even the most basic?

2011: The Year of Personal Finance Management Tools

Mark Schwanhausser of Javelin Strategy and Research recently predicted that 2011 will be a banner year for personal finance management (PFM) tools. Schwanhausser notes that the ideal PFM tools will be integrated from bank log-in and give users an overview of outside accounts.

He writes:

“Bringing PFM out of the shadows of a tab will require a new type of thinking at most FIs. The payoff is that FIs have an opportunity to change not only how customers think about their money but also to expand the role of the FI as their primary financial portal. Currently, FIs focus the online experience on accounts and balances. But smart PFM can expand the “conversation” to touch on bill pay, transfers, financial alerts, spending categorization, financial goals and more – all from the log-in.”

Do you offer PFM tools? If so, where are these tools located on your Website? Let us know in the comments section below.

What We’re Reading This Week

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.

  • Security Watch

American Banker

Active military personnel had their accounts hacked at Pentagon Federal Credit Union in Alexandria, Va., according to a Jan. 17 story in The Washington Post. The source of the leak was allegedly an unguarded laptop that had stored an undisclosed number of accounts. The hacking incident was discovered Dec. 12, according to the Post, but not reported to customers until January. The New Hampshire Attorney General’s Office, however, reported Social Security, debit card and credit card numbers of 514 residents had been hacked in the incident.

Read more

  • New breed of credit cards could offer savings — for the sharp-eyed, that is

Boston.com

A new breed of credit cards is on the way for 2011. Tighter regulations, cutting-edge technologies, and a growing willingness by banks to lend again are just some of the factors reshaping the credit card industry. For sharp-eyed consumers, the changes could present an opportunity to significantly lower monthly expenses. Here are the key trends to watch: Cards come knocking: Card offers are cluttering mailboxes again. Mailings almost doubled to 2.7 billion last year, according to market researcher Synovate.

Read more

 

  • Android Users More Interested in Mobile Financial Services, Report Shows

Digital Transactions

While the news in smart phones this week has been all about Verizon Wireless’s announcement that it will start marketing the iPhone next month, the news that may well be of more importance to mobile payments and mobile banking is the hot streak that Google Inc.’s Android operating system is on. “If you don’t have an Android plan in place, you’re already behind,” Mark Schwanhausser, a senior analyst at Javelin Strategy & Research, tells Digital Transactions News.

Read more

  • Now at Starbucks: Buy a Latte by Waving Your Phone

New York Times

Futurists have long predicted that one day, shoppers will swipe cellphones instead of credit cards to make purchases. At Starbucks stores nationwide, that is about to become a reality. On Wednesday, Starbucks plans to announce that customers of the 6,800 stores the company operates in the United States and the 1,000 that are in Target stores will be able to pay for their lattes with their cellphones instead of pulling out cash or a credit card. Various technology and payments companies, including PayPal, Bling Nation, Square, Venmo and now-deceased dot-com start-ups have been experimenting with ways to wean Americans off cash, credit cards or both.

Read more

  • Asset Managers Choose Plastic over Paper

Milwaulkee Journal Sentinel

Plastic is still gaining ground on paper. The number of credit card transactions is projected to rise to about 162 billion in 2013 from 110 billion in 2009, according to the Nilson Report. The United States accounted for about 48% of credit card transactions in 2009, compared with 23% for Europe and 16% for Asia, the Nilson Report said. The average U.S. consumer has four credit and debit payment cards, compared with an average of one per person in Europe, it said.

Read more

  • Banks tucking targeted ads onto online debit statements

Washington Post

As banks test new ways to make money and attract customers, they are tucking ads onto the list of recent purchases on consumers’ online bank statements. The charge for your breakfast at McDonald’s, for example, might be followed with an offer for 10 percent cash back on your next meal at the Golden Arches. There’s no need to print a coupon – just click the link, and the chain will recognize your debit card the next time it is swiped. “The one thing these debit programs have is a significant amount of transaction and behavioral data,” said Mark Johnson, president and chief executive of Loyalty 360, a trade group for marketers.

Read more