Category Archives: Bank Think

How does your bank innovate?

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Does your bank have a sandbox?

An incubator for experiments?

A place where failure is allowed?

Then how do you innovate?

I’ve been researching several fintech and banking topics for an upcoming presentation around opportunities beyond our typical product, service, and technology stack. We’re discussing banking’s value paradigm and how we could conjure innovative paths that drive both new sources of revenue and new types of client value.

Here are some of the things I am addressing. What is banking going to look like in 2020? What will impact our traditional model of financial service delivery? What type of new services or opportunities are being delivered by alternative providers today? How could we leverage alternative financial business models and how could they impact future revenue generation?

If you had to pivot the traditional banking business model, what would that look like? What are the primary ways banking is being disrupted – what are the key areas of vulnerability?

Those sorts of things.

The topics discussed might end up ranging from simpler consumer market expressions, like the power of social data and influence on conversion across related verticals, leveraging changing demographics in our marketplace and how attitudinal shifts impact traditional product positioning, along with likely coverage of low-hanging fruit (and personal pet-peeves) around under-utilized portions of online and mobile channels (including suggestions to improve PFM, deals, mobile transaction capabilities), lost opportunities across mobile payments and proximity based rewards, and how we better leverage transactional payment ‘big data’ in new ways to offer expansive client value.

My field for topic discovery is still fairly open, so I welcome your feedback on your vision of banking’s future. Where will we derive future revenue from, and how does that revenue pie look different than today?

Or are we already firmly planted in a multibranded-multi-channel-banking world? Some great dialogue related to this comes from Chris Skinner’s the Multibranded Bank and Brett King’s the Economist Debate on Are Bank Branches Obsolete?

One topic I am digging into is really intriguing to me.

It’s leveraging on what Innotribe’s Peter Vander Auwera calls the Digital Asset Grid or DAG. DAG presents the idea that as the banking model evolves, people will look to leverage the trust they hold in financial institutions (and related infrastructures) to evolve from the protection of monetary (and in many cases physical) assets and the facilitation of payment transactions, to a much deeper level of protections for every aspect of our digital lives.

The premise is that we offer our personal (and business) information too freely – and corporations are leveraging (and making large sums of money on) the information we share. Consumers (and businesses for that matter) should have a stake in not only the protection of this shared data, but in the revenue associated with it. In essence, start valuing what is currently devalued. At the heart of the DAG concept, is the ability to better (or ideally completely) control ones digital assets.

Can a secure, bank-built network enter into this Digital Asset Grid equation and offer value to all parties? Conceptually, I find the idea fascinating, and am reviewing several paths where this makes sense from a revenue standpoint. But DAG will serious investment and a huge amount of faith to become reality.

What’s more interesting about DAG is that Innotribe plans to walk through their business model next month in Belfast.

I’ll dig into this in future posts, but for now, get familiar with this topic because I think it holds some promise for banking beyond 2020.

First, view the excellent post from Kosta Peric, Co-Founder of Innotribe, the innovation arm of Swift (Society for Worldwide Interbank Financial Telecommunication): The Castle And The Sandbox: How To Innovate In Established Companies

Next, watch the video below that includes an introduction of the concept of DAG, along with the challenge of innovation.

This video comes from the TEDxNewWallStreet-FinOlympics presentation by Peter Vander Auwera (aka @petervan), Innovation Leader at SWIFT. In this video, Peter discusses a story about babies as a metaphor for ideas, sandboxes for experimentation for financial institutions.


Here are some related posts around the concepts of innovation in banking, Digital Asset Grid, and more:

What Banks Can Learn From Silent Movies…And The Titanic

A Global Exchange For Personal Data

“Global Data Banking”: Are the Banks Really Ready?

How Banks Might Transform Their Businesses and The Future of The Internet

Who Do You Trust More with Your Data: Facebook or a Bank?

In finance, facebook is just a phase we’re going through

Banks should follow Google’s approach to privacy

Digital Asset Grid Concept

Our traditional banking model is being disrupted because of many factors, including a) key industry players underestimate (or worse taking a blind eye to) the changes to core revenue areas within the business model, b) our inflexible infrastructure makes us less able to quickly capitalize on recent shifts in consumer and business behavior (as well as the flexibility needed in this new era of changing demographics, new economic realities and regulatory environment) and c) our lack of champions make it nearly impossible to achieve scale and derive return on even the simplest of innovative applications.

In order to facilitate long term change, we need a sandbox to innovate, we need to be able to learn from failures, and take on additional risks to see which new planks with the traditional model may stick.

Take some time to watch more industry players discuss innovation, and how it’s often necessary to pivot your business model to succeed.

Scott Anthony tells #NBASG12 how companies need to confront transformation (below)



Read Reid Hoffman On PayPal’s Pivoted Path To Success Watch the video.

As always, let me know your thoughts…here or through twitter.

Brett King: Presentation On the Utility of Banking, Mobile Payments & More (Video)

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On the heels of the Bank Innovation Conference in San Francisco, the Bank Innovation team has shared a great presentation Brett King made for the Social Mobile Payments Conference, produced by Bruce Burke.

Learn more, and sign up for the next wave of banking at Movenbank.

Learn more about my own thoughts on bank 2.0, banking industry disruption, social media, mobile payments, and other engagement banking technology in my recent Backbase webinar 10 Key Trends from the Community Banking Trenches (webinar recording at lower left, complete slides from Slideshare at right).

Original source: Bank Innovation

Which keeps you up at night: Alternative currencies or alternative payment technology?

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Nobody gets me Bitcoins!

Image by zcopley via Flickr

There was an interesting article and discussion today on American Banker‘s BankThink. American Banker’s Jeremy Quittner wrote an article about Bitcoin being highlighted in a legal case on an episode of the Good Wife this week. Brief Clip

If you want to learn more about Bitcoin, here’s another great Quittner article from a few week’s back For Banks, Digital Currency Poses Threat — and Opportunity

Read the Good Wide Bitcoin article here: ‘Cool, But a Hassle’: Bitcoin Tests Merchants’ Patience

I added comments on American Banker, and wondered what you thought of Bitcoin? What are you most focused on in fintech? Alternative currencies like Bitcoin/Facebook Credits/iTunes or mobile money movement through more traditional channels with less-traditional technologies (think Dwolla, Square, Paypal, etc). Am I missing something on alt-currencies? Let me know via Twitter: @leimer

Here were my comments on the American Banker post:

Are alternative payments like Bitcoin a curiosity or just a progression toward the ongoing transactional shift away from traditional banking (or traditional currencies for that matter)? Though the volume of alt-payments/mobile payments is growing rapidly (astronomically some might say), the vast majority of consumers and merchants still do not see the use of the established volume leader, Paypal (amazing growth under the recently departed Scott Thompson), as a form of regular payment activity.

The innovations of currency alternatives like Bitcoin (and mobile payments) are a great destination, a great promise of better technology and control around money movement and control for consumers and businesses, but it is often an overhyped ‘promise’ of what is to come…Yes, volumes are on the rise. Yes, some amazing technology is being developed and implemented. Yes, the user experiences around contactless payment (NFC, alternative POS), and alt-currencies (Facebook credits, even iTunes) are currently being established (certainly Google and Apple will have some say about this).

But how much do banks need to pay attention to alternative currencies? Yes, we should be prepared to integrate and embrace technology change around money movement of any kind. But, if you’re in banking or fintech, you’re probably more closely watching alt/mobile payment volumes rise and crafting/enhancing your payment/money movement technology at your own financial institutions in response. I wouldn’t worry as much about the Bitcoin model/alt currencies just yet. They’ll most likely take the back seat to money movement through traditional players (and in the alt-currency space, I would be more concerned about Facebook Credits than Bitcoin).

Money movement alternatives like Paypal, ZashPay, Cashedge/Fiserv’s PopMoney, Dwolla, Square (+ others) do have a built in ‘hassle’ within the user experience because of the need to link to additional traditional banking accounts somewhere. The person/merchant receiving funds also have to be on the same network or sign up/trust these providers. It seems like the only way to eliminate this is with an established alt-currency (how is the Euro working out, let alone the anti-banking alternative digital Bitcoins?), or an established open-API method of money movement (better solution). To address the overall UX, we need to integrate both technologies into the devices we carry everyday (our phones), whether it be through form factor (NFC/alt-device) or network apps (Paypal POS, Proxense, etc.). The UX still would take a back seat for alt-currencies like Bitcoin until you bridge the additional gap in the trust factor (Paypal itself, even with great UX, still isn’t as trusted for money transfers as a traditional financial institution).

We will have some time to watch these standards develop. As we watch the volume of alt-payments rise, the overall volume will be a limited space in the overall consumer/b2b payment pie. The true revolution in banking that everyone sees coming like a lumbering freight train is still there. It’s less about alt-currencies and more about overall experience through technology. But Movenbank and Simple aren’t going to change the world of banking overnight, nor has (or will) Bitcoin or Paypal for that matter. But changes are here, they’re real, and there are more are on the way (Paypal, Square, and Dwolla are will see monster jumps this year to be sure).

The fact that the Good Wife even tackled the subject is interesting. The audience for the episode probably increased awareness of Bitcoin in Peoria more than anything Bitcoin’s banking industry coverage ever did.

What Will 2012 Bring for the Banking Industry?

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What Will 2012 Bring for the Banking Industry? I added an initial response to that question today on banking.com, Intuit’s community banking site focused on collecting insight into the financial services ecosystem.



Source for Payment Ecosystem Graphic Visit Payfirma.

While my quote (see the original post linked below) demonstrates that I feel mobile will finally hit its long-awaited stride in 2012, there is so much more opportunity for the average community institution to gain ground in 2012. Will there be unexpected challenges? No doubt. Technology alone is rapidly changing the competitive landscape in banking, and payment alone is starting to crumble down the barriers on what was once considered core banking services. But banks and credit unions offer much more than that.

What are we going to see in 2012? What are your plans?

What do you see as some of our biggest challenges and opportunities in 2012?

Chime in.

From the original post on banking.com:

“2012 will finally see the tipping point for mobile banking. Mobile moves beyond today’s limited functionality and starts to become the primary remote customer channel. Look for some interesting corporate bedfellows to emerge as the financial services ecosystem starts validating mobile payment business models and the importance of controlling new methods of money transfers and payments. We will see continued disruption in the space, as it relates to payments, security protocols, features like proximity rewards, integrated p2p and a2a with social tether, account opening, and more. Expect feature rich device agnostic applications that enhance usability and user experience across a range of mobile and tablet devices.” Bradley G. Leimer, Vice President, Online and Mobile Strategy at Mechanics Bank (@leimer)

Full Post @ Banking.com

BankSimple Interface Revealed at Finovate

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BankSimple showed off their interface today at Day 2 of Finovate 2011 NYC. The buzz about the product has been very strong for the past 18 months since BankSimple first came into the fintech ether, and it looks like Joshua Reich and team have delivered on all the hype. While there are a few immediate things I can see being added to the user interface, the easy transaction search and categorization and simple UX makes me want to open an account now.

Continued success to the BankSimple team, and to the ongoing disruption in the space. For the video below, I highly recommend making it full screen to really experience the UI of the product.

BankSimple Demo from BankSimple on Vimeo.

Stop Blocking, Start Embracing the Social Enterprise

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The recent Dreamforce conference in San Francisco focused on the rise of the ‘social enterprise.’

We can loosely define the social enterprise as the democratization of business processes through technology channels that remove barriers for engaging communication by flattening organizational levels, enhance the sharing of innovation and ideas and increase opportunities for enriched connections among employees, customers and inter-related groups.

By leveraging the social model, the banking industry has the potential for a dynamic period of innovation, and an even chance of remaining relevant to our customers — and employees — as they gain control of the conversation.

During the conference keynote, Salesforce.com’s CEO, Marc Benioff drew a comparison between the social powered revolutions we saw during the Arab Spring and the evolution within the business world. Though Salesforce is recognized for innovation in cloud computing and customer relationship management, the company’s deliberate pivot to embrace social technologies as integral to their business model is significant for the banking industry, which has historically been less than accommodating toward new technologies.

Read the full post on American Banker’s BankThink.

If you cannot access the link, or if it requires a subscription, please email me at bleimer@me.com and I will send you the story directly.

What do you think?

You can follow me on Twitter, connect on LinkedIn, and add me to your circles on Google+.

Additional Media featuring @leimer
Friends With Benefits (Bank Technology News)
Bankers, Pay Attention to Google+ (American Banker Bank Think)
Smart Phones Alter Banking Landscape (ABA Banking Journal)
Dickens' Spirits Speak on Tech Spending (American Banker Bank Think)
A 'Hunch' That Could Yield Useful Marketing Lessons (American Banker Bank Think) 
How to Get Started in Social Media (American Banker)
5 Social Media Best Practices (Information Week Financial Services)
Social Media Best Practices (Adobe Experience Delivers)
"The Deer Have Guns" (American Banker)
Citi, USAA Execs Share Social Media Best Practices (Bank Systems & Technology)
Reviewed: Bank 2.0
Celent Banking Innovation and Insight Day Recap 
Celent Event Photos 
Celent Innovation & Insight Day - Social Media Panel

Summary of Engagement Banking Meet-Up in San Francisco

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Last Friday evening, I was fortunate to spend some time at an impromptu Bank 2.0 MeetUp in San Francisco with author and engagement banking pioneer Brett King.  Joining us in the conversation about the next generation of banking was Michael Degnan, Engagement Banking Leader for Sapient Nitro’s Financial Services Center of Excellence, as well as Scott Sanborn, the CMO of SF-based Lending Club, which had just closed a $25 million round of new funding earlier in the week.

While I won’t be providing a complete tick tock of our MeetUp in this post, it was great to talk about the future of banking and the shift in technology and customer expectations with some of the more innovative thinkers in the space.  It was also nice to meet and talk shop in person after conversing through Twitter. While I am huge proponent of social collaboration and conversation, nothing beats the impromptu dialogue of a conference break out session or panel, and all those side conversations that inevitably occur.  I applaud Brett’s efforts to set up MeetUp’s during his business trips, and encourage others to embrace social connections and follow suit.

I really enjoyed talking to Michael Degnan and learning more about Sapient Nitro’s involvement in engagement banking, as well as talking social data.  How can a user’s social graph be leveraged to offer enhancements to the customer experience and transaction components for traditional banking channels? What about ways to improve the investing and portfolio management customer experience?  We talked about the latter after Brett announced S&P’s credit downgrade of the U.S. government to the group. Talk about a conversation thud – “the most risk-free investment now has risk”.  Boom. Now it was some time for some navel gazing and a moment to ponder Monday’s market open and how our portfolios melt away.

Outside of that news-bomb, it was great to get an update on Lending Club, and hear about their recent funding successes.  As companies and personal investors look for better returns and diversification (especially in light of recent events), the social lending space will continue to grow (Lending Club added $20M in new loans in June alone).  More power to them if the larger banks aren’t as willing to lend and embrace the social aspect of what has been estimated to be at $60B P2P market through family and friend loans.  Propser, the other big-player in the space along with Zopa, has received huge rounds of investment of late, including $150M in June, and another $17M from Google’s Eric Schmidt.

Brett’s project list is intriguing as well, including a follow up to his successful book, Bank 2.0, which has been an industry board room topic since it launched last year.  I was especially interested in learning more about his mobile-optimized banking startup MovenBank, which has promise to be an important player in the banking landscape.  Brett talked about how MovenBank is being designed to remove the friction caused by existing technology and locational constraint that exists between financial institutions and their customers today.  I imagine that Brett’s literal napkin diagram of the existing banking structural constraints has been repeated across the jet-setting pace of his past year’s conference schedule. I remarked about my feeling of deja vu after seeing Al Gore deliver his “Inconvenient Truth” presentation with my wife in San Francisco two years before the book and movie came out (though Gavin Newsom and Jerry Brown weren’t seated at the table as they were when we saw Gore) .  It makes sense that the author of Bank 2.0 would be designing customer-experience-driven processes to avoid the tension created by existing banking structures, and that is exactly why it’s engaging.  There’ll be many of us in the industry secretly rooting for MovenBank.

Whether MovenBank intrigues the larger banking community as much as BankSimple has (or had, at least by the dearth of recent coverage) remains to be seen.  I can only hope that Brett’s partners will continue to do something the banking industry sorely needs, and that is to further shake things up to the benefit of the banking customer and for the overall user-experience (which has huge gaps, as you occasionally see in my tweets about online banking, PFM, mobile, and UX).  The other purpose of MovenBank, in my opinion, is to inspire further innovation.  Companies waving the flag of true innovation are rare in the financial services industry, whether this is due to natural barriers of entry or the conservative nature of bank technologists and their C-level counter-suits. Disruption isn’t just coming, it’s already here (e.g. mobile payment).

We need to create more Bank 2.0 converts and more “engaged bankers” in our industry (maybe by the time Bank “3.0″ or whatever Brett calls it comes out, more of the industry will have read his first book).  As a reluctant “banker” (I don’t think anyone in banking technology, analytics/data or financial marketing ever really calls themselves a ‘banker’),  one has to encourage this type of industry-shaking thinking and technology development however we can (as I covered in a year-end post on American Banker’s BankThink).  If not to benefit the customers and industry we serve, but to improve our own user experience as consumers and business owners as well.

What do you think?

You can follow me on Twitter, connect on LinkedIn, and add me to your circles on Google+.

Additional Media featuring @leimer
Friends With Benefits (Bank Technology News)
Bankers, Pay Attention to Google+ (American Banker Bank Think)
Smart Phones Alter Banking Landscape (ABA Banking Journal)
Dickens' Spirits Speak on Tech Spending (American Banker Bank Think)
A 'Hunch' That Could Yield Useful Marketing Lessons (American Banker Bank Think) 
How to Get Started in Social Media (American Banker)
5 Social Media Best Practices (Information Week Financial Services)
Social Media Best Practices (Adobe Experience Delivers)
"The Deer Have Guns" (American Banker)
Citi, USAA Execs Share Social Media Best Practices (Bank Systems & Technology)
Reviewed: Bank 2.0
Celent Banking Innovation and Insight Day Recap 
Celent Event Photos 
Celent Innovation & Insight Day - Social Media Panel

My Latest Post on American Banker’s BankThink: Bankers, Pay Attention to Google+

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Google just launched a social sharing platform called Google+.

And it doesn’t suck

And over 10 million people are already using it.

What does it mean for your bank and how it should view Google+ and the social media landscape?

View the full post on American Banker’s BankThink.  Link: http://t.co/6bmOmdG

Google Plus Functions

 

Bradley Leimer manages the online service group for Mechanics Bank in Richmond, Calif. The views expressed here are his own. You can follow him on Twitter and find him on LinkedIn. And now Google+.

If you can’t view the full post, please email me directly at: bleimer@me.com or bradley_leimer@mechanicsbank.com

I have a ‘hunch’ this is an important marketing lesson (my recent post on American Banker’s Bank Think)

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Which way do you prefer your roll of toilet paper to hang? Should the paper roll out from the front of the roll, or should it roll from the back? You might wonder what that has to do with banking, but I bet you thought a few seconds about your preference. That’s the genius behind a New York start-up called Hunch, which bills itself as a way to personalize the Internet by making smart recommendations about what you might like based on a series of questions.

Read the full post at American Banker’s Bank Think

Bradley Leimer is a dedicated senior marketer with experience in brand development, online / offline marketing, database marketing, web development, and online banking / mobile financial applications. You can follow him on Twitter and find him on LinkedIn.