Emerging Technologies: Mobile Banking, Remote Capture Are Key to Attracting Gen YToday's Hottest Solutions Are All About Securing Tomorrow's Customers Mobile banking, Web 2.0, remote check capture - they're among the emerging technologies that appeal most to banking institutions. The key driver: the chance to offer more services to customers, and also cut costs through the further automation of banking transactions.
We recently spoke with leaders of the top banking solutions vendors to get their perspectives on the emerging technologies with the greatest buzz in the marketplace. Their responses range from the obvious -- mobile banking and bill pay - to more global concerns such as international payment systems and multi-language services.
The Year of Mobile Banking?
The internet sparked this industry-transforming change from physical to electronic banking. Now the march continues with mobile banking via smart phones and other devices aimed to reach the 200 million cell phones in the United States.
Tom Wachtl, Corporate Senior Vice President and Chief Technology Officer for FISERV's Online Banking Group, says there has been a "huge buzz in the industry about mobile banking, from trade magazines and vendors saying its finally here -- the three moons have aligned."
Institutions are asking for mobile banking solutions, agrees Dottie Yates, Vice President of Product Management ePayments/eBanking at Fidelity Information Services (FIS). "The biggest area of interest this year seems to be mobile banking and mobile bill pay," she notes.
Dave Fortney, Chief Technical Officer at Metavante says his company has several strategic initiatives for its clients that want to offer mobile banking. Metavante recently bought half-interest in a company, Monetise Americas, which is co-owned by a British firm, Monetise UK. Monetise Americas offers mobile banking and payment services to 30 institutions in the US since it was formed in Fall 2007.
Fortney notes the decision to partner with a British firm was because the UK, along with the rest of Europe, is ahead of the U.S. in offering mobile banking transactions. The technology Monetise UK developed is now running at Metavante. "We're offering as a first phase, banking transactions including balances, mini statements and transfers -- all are similar to our online banking solution," Fortney says.
Every one of Metavante's product lines has some plan to utilize mobile banking. "That is why we partnered with Monetise UK and invested in a company that is pushing the envelope," he says.
The success model for mobile banking is already seen in the use of services such as text messaging by the Gen X and Gen Yers, says Wachtl. He sees an interesting spin on the evolution of mobile banking. "I expect that mobile banking will look a lot like online banking did in the late 1990s, as far as adoption rates go." But as institutions ramp up in the next five-to-seven years Wachtl imagines "Anywhere from 20 to 30 percent of the population will use mobile banking."
The evolution of mobile banking technology will mimic the early days of ATMs, where all banks had their proprietary bank networks that would only accept that bank's ATM cards. "Eventually all of that got worked out, and based on adoption or market demands, mobile banking will become a ubiquitous service and there will be some standards, phones will have a chip in them that can work in anyone's point of sale system," notes Wachtl.
Coming Soon ...
Banking institutions are also clamoring for other new technologies, says FIS' Yates. On the online banking side, "Clients are constantly asking FIS to launch new technologies that offer more self-service capabilities to our eBanking and ePayment suites of products," Yates notes.
Here are some examples of the new technologies bank clients are requesting:
FIS' Yates sees the industry moving toward increasingly self-service banking technologies that have a lower impact on the environment. "The industry will also move toward revenue generation through electronic payments options and from offering additional electronic services that help commercial banking clients grow their own revenues," she observes.
The future, she sees, is in providing banking technologies that attract Gen Y customers, who will be critical to bank success. "Gen Y customers are technology savvy and expect access to their banking services and information anywhere, anytime and via any device. This segment will have the largest revenue potential of any prior generation," she notes. It will behoove banks to attract those clients now in order to profit from that unprecedented revenue stream in the next 10 years.
FISERV's Wachtl agrees. "The belief is the Gen Y crowd is the future bank customer. If banks offer them the innovative technologies, they'll keep them through their life cycle," he predicts.