Mobility Matters - Tracking the Mobile Banking Revolution in Credit Unions: Online Only
Credit union mobile banking debut of the week. Are small credit unions priced out of mobile banking? Not so fast. Exciting news is emerging that indicates, just maybe, there are cost effective ways for tiny institutions to mobilize their memberships.
A year ago, Jennifer Oliver, CEO of South Bay Credit Union, a $75 million institution in Redondo Beach, Calif., feared she was marooned on the sidelines, destined to look in at mobile banking but never to be a player because the prices she was hearing were beyond her budget. Then she changed the game.
First South Bayswitched its core provider to CU*NorthWest, a CUSO in Liberty Lake, WA. Thrown into the package was Web and text-based mobile banking - Oliver’s credit union was mobile that fast. Literally it was just a matter of flicking a switch.
“Then I got greedy, I also wanted an app,” said Oliver.
So she worked with an app developer who understood shoestring budgets. The result: an iPhone and also an Android app that, said Oliver, she will share with other credit unions at a nominal price, typically around $1,000. (Note: it will work only on CU*NorthWest cores and CU*NorthWest joined with Oliver in underwriting the costs of apps development.)
Oliver is candid: “Our app is not that robust - but I don’t think we needed more. It lets a member do the basics - transfers between accounts, inquiries, see what checks cleared, and bill pay.”
“We are small,” said Oliver, “but with our mobile app I feel mighty.”
Diving Into Data for Dollars
Overwhelmed by social media information and puzzled about how to put it to good use? Know that new breed analytics companies are emerging that promise high octane sorting tools for making sense of member Tweets and Facebook posts.
Case in point: “A little one is on the way.” Read that in a member Tweet and what is your next move? Clients of Austin, Texas-based BuzzBanking know that probably presages birth of a child and with it, a huge change in the financial profile of the Tweeter. And that could ring the cash register at an alert credit union.
BuzzBanking CEO Jay Valanju explained what the company’s mission is: “We think social media should be used in a different way. The most important: to understand what consumers are thinking and doing. We analyze the tweets and Facebook posts of a credit union’s members. We analyze what they are saying. We will reach out to these members. If you say you got a new job, this may mean you want a loan for a new car. We know one event often leads to another.”
What keeps the analysis affordable is that it mainly is done by machine, said Valanju.
Fiserv on Mobile as a New Channel. A new briefing paper from Brookfield, Wis.-based financial services company Fiserv posits a provocative question: Is mobile a different view of online banking...or something entirely different? The Fiserv authors think it just may be something entirely different: “It is likely that mobile channel popularity will mimic that of online banking and gain popularity; especially for those consumers who own a mobile phone but do not have access to a computer. The mobile channel is evolving from informational to transactional.”
Fiserv said in its report that the three main banking channels – branch (analog), online and mobile – correspond to three ways we eat: fine dining, lunching, and snacking. We can dispute that torture of a metaphor – many digital consumers will never visit a branch but wouldn’t think they had missed out on a fine dining experience. But there is every reason to agree with this view of mobile: “Like snacking, the mobile channel lends itself to quick banking interactions. Typically, these interactions involve transactions that take less than 60 seconds to accomplish, or have a sense of urgency, such as checking balances, looking at an alert and paying a bill at the last minute. When consumers were asked to list the reasons why they use mobile banking, the top two reasons related to accessibility and convenience.”
Added Fiserv: “Mobile will not replace the online channel, but it will change how it is used. As more and more consumers adopt mobile banking, they will no longer see a need to wait until they are near a personal computer for quick and simple interactions. Done right, the online channel will make consumers want to “do lunch” with their finances.”
Download a free copy of the report here.