By Mary Wisniewski, Royal Media Group
Adapted from an article published in the Winter 2013 issue of TradeLines.
When USAA’s iPhone-app customers synced devices with their new iPads, consumers instinctively began to deposit physical checks remotely using the tablets’ cameras. There was just one problem: The functionality was not yet built for USAA’s tablet app, and the San Antonio, Texas-based bank wasn’t prepared to handle the quirks, like the difference in aspect ratios between iPad and iPhone images. In turn, USAA was forced to make fast technology tweaks to accommodate consumer behavior.
“Customers will use you whichever way they want to use you,” said Neff Hudson, USAA’s assistant vice president of emerging channels. “There are big challenges.” That customer power is meaningful to banks like USAA, whose tablet-banking users slant toward a wealthier audience, which Hudson attributes to the tablets’ high price tags. Plus, the majority of users fall under the aging Baby Boomer category, so products and services important to them hinge on retirement and research related to financial topics, said Hudson.
USAA’s internal data is in line with what Forrester Research Inc. found in data it published last year. The global research firm reported that tablet early adopters boast higher-than-average incomes — at least $120,000 annually — and advanced education, attributes that make them more likely to utilize numerous offers of financial services.
Hudson predicts that in the next year many new mobile and tablet banking functionalities will emerge from within the industry.
“More complicated products will be sold through more immersive media devices,” he said, adding that “Underwriting is one of those areas that should get simpler from the customer standpoint and more accurate from the institution standpoint.”
Beyond underwriting on the go, tablets will play a role in changing the way in which products are sold. Kevin Travis, partner at financial services consultancy firm Novantas LLC, has noticed murmurs of banks sending sales forces into the marketplace armed with tablets to simplify the loan-origination process.
Take small-business lending, for example. As loan origination requires a deluge of paperwork, tablets and smartphones could save busy business owners the hassle of coming into physical branches three or four times. “It’s a huge increase in productivity,” said Travis.
Even smaller banks are getting into the tablet game through their vendors’ debuts. Intuit Financial Services, an online-banking vendor to nearly 1,500 U.S. banks and credit unions, is looking to add account-opening functionality into its smartphone and tablet bank offerings. Though the vendor has standard functionality in place to do things like check account balances, Intuit Mobile Solutions senior product manager Deepti Sahi said she “sees a need to meet both mobile registration and account opening functionality.”
Currently, Intuit is working to ensure that consumers can open accounts within three to four clicks, a necessary feat as “the attention span on mobile and tablet is shorter,” said Sahi.
“That’s a challenge,” she said. “How much risk does an FI [financial institution] take on and what is the bare number of steps to take on to create a new membership? …We haven’t figured out the answers. We’ll collaborate with the risk appetite of our partners.”
Beyond tablet trajectories, FIs are ultimately striving for the holy grail of deploying universal applications so that their customers can start interactions that begin in one channel (e.g., a tablet) and finish in another (e.g., a PC).