KeyPoint CU, Using Facebook, Leads Way in the New Wave of Service Channels

"It's more than a wave. It's almost like a tsunami coming in here now. I can't imagine how people in legacy environments would be able to get where we are today," Callis said. "Just handling the nuances in security would seem like a lot. I know the single sign-on was extremely important to me."

Mike Nicastro, senior vice president and chief marketing officer at Open Solutions, said, "You have to have the capabilities to do that in this new Web world. That's where legacy environments are having a hard time."

Using the mobile banking engine from MShift Inc., KeyPoint launched the Facebook integration with relatively little configuration to its core system interface, an arrangement which also allows account access with a single sign-on whether it's through the regular online banking site or Facebook.

From Facebook, the credit union offers account to access information as well as news from the credit union and group discussions built around the application. Nonmembers see an offer to join and instructions how to.

The Facebook launch follows a pattern. "We're the first on Facebook. We were the first to go with live chat around the clock," Callis said. "And when we went with mobile banking, we used MShift, because it's carrier- and device-agnostic and immediately made every carrier and device available to my members."

Callis said she also wants to "bust the myth that all this is just youth-based. I'm not going after Gen X or Gen Y or Gen anything. We're sitting here in the Silicon Valley meeting the needs of the mostly technologically advanced, globally mobile workforce in the country, and frankly, that's not college students," she said.

Callis and Nicastro also both said they don't see any channels of delivery disappearing, just more being added. Internationally, other countries may be ahead in providing some of these, simply because they never had the legacy services to begin with, Open Solutions executives point out. To Callis, that doesn't matter.

"These are global citizens…highly educated, highly compensated and highly demanding," she said. "They don't accept that America won't provide these services. We have to be able to do that. And with our partners like Open Solutions and MShift and using widgets and the other tools out there, and an outsourced call center operation that can be trained to handle all this, we're able to do it quickly."

Web 2.0 delivery is one of the key ways KeyPoint is doing that.

Web 2.0 is a bit of an umbrella term, referring in general to the latest generation of Internet-delivered software services that in this context take the shape of social collaboration, ease of use and integration into other visual presentations. Mini-applications such as widgets are typically the delivery avenue for such uses, such as a live, secure online banking interface appearing on a Web site like Facebook or iGoogle.

A recent survey of 1,000 Facebook users between the ages of 18 and 34 found that 48% would use online banking with Web 2.0 widgets if their financial institution offered them, and fully one in four would switch institutions to get such services.

"To lose a quarter of your customers to competitors who have provided secure Web 2.0 banking would bear a significant impact on existing businesses," said David Lavenda, vice president of marketing and product strategy for WorkLight Inc., a Web 2.0 services provider that sponsored the survey.

"This is particularly true at a time when financial services companies are struggling to retain and acquire customers in a market saturated with new competitors and countless new offerings," Lavenda said.

Retention, as Lavenda said, is another concern. For instance, last year, financial services consultancy Celent surveyed U.S. college students and found that 60% would keep their current banking relationship on into their working lives.

Nicastro said Open Solutions is hearing more from banks in general and credit unions in university areas about expanding into the new delivery channels

While Callis notes that her membership skews to the affluent, educated and tech-demanding, the demand for such services growing nationwide is helping her take her case to her credit union board to push KeyPoint's services beyond its cyber-walls.

"I'm the president of our CUSO and will be making a formal request to our board to allow us to offer emerging technology packages to noncompeting institutions," she said.

And she also will keep a close eye out for new tools to offer her members. (Open Solutions said it now is working on enabling text messages for payments.)

"Open Solutions and MShift…for me, they are the story. They got us there fast and have helped us sustain it," Callis said.

"I was a banker with Citibank and for a short time with Wachovia, too, before I got here, and I can tell you, any financial institution that wants to be relevant in the future had better get to work being relevant right now."

–mrapport@cutimes.com