For decades now financial institutions have been trying to movetheir customers from a more traditional and costly,person-to-person type relationship, to a more cost-effective,customer self service model. Starting in 1966 with the introductionof the automated teller machine (ATM) the customer self-servicemodel began. The basic philosophy was, let the customer servicethemselves and the financial institution won't require as manytellers in the branch.

Considering the times, it was a pretty bold move. Back thenperson-to-person relationships were considered very important. Youwould never consider taking a valuable customer and making themtalk to a machine. But that's just what financial institutions did.They realized that not all customers were profitable and that theunprofitable customers were taking time away from the customersthat were profitable.

I remember there was a time where some of the big banks thatprovided basic checking accounts would charge the customer if theyactually went into the bank and talked to a live teller. I'm notsure to what extent that that policy is in effect today, but itsure does let you know who they value and well, who they don't.

After some time passed, people became accustomed to the ATMs andsome even preferred the faster self service they provided. The ATMnetwork grew over the years and ATMs became more prevalent aspeople became more accepting. Then in 1981, a crazy new bankingproduct was first introduced, although it was more than a decadelater when the Internet let it take off.

Online banking brought the banking experience into your home. Italso scared the pants off a lot of people. Privacy and securityissues instantly became big worries for people who wanted to usethis new product, but Internet security was virtually non-existentback then. Online security was a valid concern. But slowly, daringpeople started using the online banking system and were introducedto an even more efficient means of customer self service.

About two and half years ago, I was part of a roundtablediscussion on the future of wireless technology. When we got on thetopic of mobile financial applications, I was very skeptical. Ilooked at my flip phone and said how am I going to read anything onthis little screen? And there was no reliable wireless broadband. Ijust didn't see how something like mobile banking would work.Obviously great strides were made with both the wireless devicesand wireless broadband service.

Enter 2008

In today's environment the applications can be written andloaded directly on the array of smart phones out there. Broadbandwireless service is prevalent in most markets and mobile banking istaking hold as just another channel that a financial institutionmust provide service through.

What's Next

Mobile banking is just the beginning for mobile services. I cansee my kids in the not-too-distant future using their mobiledevices not just as a phone or Web browser, but instead using it astheir mobile wallet. This device will house the ability forinstantaneous wireless payments for merchants, Internet purchases,bus pass, train pass, movie tickets, etc. With the introduction ofthe iPad you now have your mobile computer as well and there is notelling what uses will come from that device. Let's face it, "It'sa Mobile World After All."

I recently read an article about a NYC hot dog vendor thatbought a new iPad. He loves the device but had some veryinteresting ideas on some apps for it; here are a few of them:

More Buns and Dogs Please: A wireless abilityto order replenishment supplies during the day. As a one-personoperation, he wants to be able to order more hot dog buns orknishes from his supplier without leaving the stand.

Language Translations: He sells food to peoplewho speak dozens of languages and sometimes have difficultyunderstanding his Egyptian-accented English. He would love to havea menu, with prices and ingredients in numerous languages. Peoplewant to know if the hot dogs have pork (no) and if the chestnutsare ready (yes, in winter). And, some would order more if theycould just press a picture.

Schedule Updates: His business is impacted bythe start and ending times of Broadway shows and special events inManhattan. He needs to have kabobs almost cooked by the time "Rockof Ages" and "Jersey Boys" lets out. He would integrate show timesinto his iPad and keep some historical data on who is hungrier.(Hint - musical shows are best for hot dogs. Dramas buy less butare good for a soda).

To me the only decision we have to make is how do we, as anindustry, leverage this new mobile marketplace. There will be morethan just mobile banking and payments. Soon you will be tying insocial aspects into the mobile ... whatever. The mobile future isonly limited to our imaginations and we can't view this future froma Boomer or even Gen-X vantage point. Our industry needs to attractthe young to survive, so let's provide them with banking solutionsfor the future not from the past.

Chris Barber is a veteran of more than 20 years ininformation technology. He is a former CIO of WesCorp and now aconsultant to credit unions.