| By William Azaroff on October 8, 2007 10:19 PM | Comments (10) |
My wrapup from Finovate identifies those companies doing things that have particular resonance for me. I don't mean to slight anyone by exclusion—all presentations were well done—but I wanted to focus on the products that held relevance for me as someone with a keen interest in social media and credit unions.
Ginny asked in a comment during my live blogging: William, what's your take on the products you described? Which ones will credit union members want to start using right away?
Good question. For credit unions there are a few companies that jump out at me.
ClairMail offers a solution that makes it easier for people to detect fraud quickly, as well as to gain access to their finances from anywhere. I like that their system is not only about consumers getting alerts to warn them about activity on their account, but also makes it possible for them to approve transactions, reducing the embarrassment of having a card declined. For instance, instead of declining a credit card at the time of sale because the purchase seems fishy or is abnormally large, a bank customer will receive a text message to their pre-registered cell phone and can approve that the purchase is, in fact, theirs. It gives consumers greater control over their finances, which is a big plus.
I also liked Identity Theft 911 because it focuses so much on education. Their service is a great fit for credit unions to help members better understand identity theft and protect themselves, in addition to dealing with and resolving a security breach should it occur.
Mobile banking is very exciting for me, but I don't know enough about it to know the differences among the excellent presentations I saw. Some people say consumers still aren't ready to transition from online banking to mobile banking, while others feel that mobile banking will eclipse the usage of online banking within a few years because of the ubiquitous penetration of cell phones in our lives, and the 'always with you' aspect of cell phone technology, which makes it more convenient, especially at the moment of purchase. It seems like for any company looking at moving to mobile banking contacting the various companies at Finovate would be an outstanding place to start. For more information on Mobile Banking, please look at Brandon McGee's excellent posts about the event.
In the States, I think Mortgage Marvel from MortgageBot is amazing at aggregating lots of mortgage information and presenting it without collecting superfluous information from consumers. It is very customer-centric and gives excellent information in response to queries.
Similar to Mobile Banking, I liked a lot of the Personal Financial Management solutions I saw, but I can't say I could pick out a favorite. Lots of good thinking and solutions.
With PFM, I struggle between two opposing viewpoints: the PFM solution should exist at the FI because it makes it easier for the lazy, who are the ones most in need of the help the solution provides. 
On the other hand, the magic happens when consumers aggregate information from multiple sources and the advice provided isn't tainted by coming from a single FI, which may be perceived to have ulterior motives. For me, I come down in favor of third-party social personal finance like Wesabe, Mint and Geezeo. In the end, only they can truly have the end consumer's best interest in mind; no way a single FI can beat that.
I also like the social lending space a lot, and it was great to see LendingClub, and how they harness the existing relationships people have on Facebook to suggest good lender/borrower matches. I was also happy to hear from Prosper.com. I hadn't seen them since April when they presented at Net.Finance, and I liked the new features unveiled, such as tools to help lenders 
make better decisions and avoid loans that may not make them a decent return (although these warnings can be easily ignored if other reasons compell to fulfill the loan such as family connections, alma mater, or an attraction to the borrower's story). Another new feature allows users to create a simple portfolio made up of various loans instantly, based on pre-stated risk tolerance.
For me, social personal finance and social lending tap into the exact same desires that led to the creation of so many credit unions several decades ago. It's exciting to watch the current fluidity of the industry and try to guess where it's all heading. I think it's interesting that the winners of the Finovate Best in Show, made up of voting from attendees, was Mint, Prosper.com and Mortgage Marvel. All three reallocate power away from FIs and give it to consumers.
William Azaroff is the Interactive Marketing & Channel Manager at Vancity where he develops interactive marketing initiatives, and pioneered ChangeEverything.ca, the groundbreaking change-themed online community. William builds on a decade of experience at digital agencies in Vancouver, Seattle and Los Angeles driving strategy, extending brands to the Web and building relationships for companies in several verticals, including Honda, Disney, Intuit Canada and the Government of BC. He discusses trends and noteworthy achievements in social media at his blog: azaroff.com/blog.
Very useful information dude! I liked the part about "Identity Theft 911" , as I've been a "financial victim" myself..
I hate those scamers! and I would do anything necessary to protect me and my credit card.
Work for your money people, don't think you just deserve them !
Just sat thru a Clairmail webinar in conjunction with some Javelin research. Definitely understand the customer alert appeal - though suspect the number of alerts any one consumer will allow to exist and impact their day will quickly limit itself.
My question in regards to the whole mobile banking platforms is the intersection between mobile banking and more traditional telephone banking - including voice recognition/response, etc. Seems to me that since most cell phone users primarily use the phone as a phone - might we not be more successful as an industry more heaviliy leveraging the voice capabilities and simply supplement them with SMS, alerts. Things I'm seeing all focus on the more Clairmail approach - where the voice side of the equation sin't pulled in effectively. Would love to know your thoughts on that William!
Hope all is well!
William, it's great having you as a guest bloger at netbanker. Thank you for the coverage of Finovate.
@ Ted. Thanks for your comment. This would be a much better question for Brandon McGee, who is truly an expert in this field. But you asked me, so here's my answer, right or wrong.
I think they deal with two different needs. One is a way to move money in a visual way, as opposed to through voice prompts on a phone banking system, and the other is sending alerts to ensure consumers that their money is safe and their balances are above (or below) certain defined thresholds. As browsers on cell phones get more advanced (iPhone), the need for transactions through cells will be more obvious, and consumers will adopt it in big numbers.
Having said that, it looks to me like mass adoption of mobile banking is still a couple of years off, and getting your customers used to transacting via cell phone by adopting ClairMail or a similar service could be a good indication of their appetite. It's still an early adopter's game.
I'm curious what you and other readers think. Could cell phones breathe new life into automated phone banking systems, or is the future in phone banking via mobile banking?
I don't think you should struggle so hard about the distinctions in PFM because they're not mutually exclusive.
Banks are waking up to the fact that doing right by the consumer generates bottom line profits. It's called improving the customer experience and banks like Wamu point the way for everyone.
I'd also say that PFM on the bank website is going to be about a lot more than seeing where you're spending your money. Paying your bills is both the most time-intensive and painful day-day financial chore AND the one that holds the most promise for the FIs bottom line with retention and fee income opportunities. And that function will continue to consolidate at the bank website because it's both an expectation and because of lingering security concerns.
Finally, I'll offer that PFM's eventual success on bank websites will be less about consumers' laziness and more about their higher expectations for convenience - and vendors' abilities or lack thereof, to create easy to use web services and features. In a world where we need to remember dozens of passwords, and where consumers already go to their bank site weekly to manage their finances, what could be easier or more natural than simply "doing more" of your finances there.
If banks rise to that challenge by also focusing on the financial mgt needs of consumers (as opposed to just pushing product) they will have the opportunity they've always had but often times have squandered - being the center of their customers' financial universe.
If they fail, I'm sure mint, geezeo, and a slew of other start-ups will be happy to relieve them of the burden :-)
I read you comments on Financial Institution's PFM vs management tools like Mint, Geezeo (and I'll add Wesabe). I have to say that I am intrigued by the comment made by Paul Rosenfield. I find Wesabe (which is the one Web 2.0 PFM tool that I've tried) a bit cumbersome. Uploading my financial information is time consuming and it's "hit and miss" on adding the appropriate tags. I like the idea of tapping into the knowledge base of members of the community with similar goals, spending habits etc. but I must admit that I don't take the time to do that. I guess what I'm saying is that it takes too many steps.
Now if I could do the tagging right in my credit union online account and get instantaneous reports on groups of categories for budgeting and analyzing my spending habits - That might be something I might use!
William, you've observed that "the magic happens" when an individual's information is aggregated and used for fiscal education and suggestions. I agree, but for me, this information may need to come in the form of RSS feeds. I just don't seem to be able to plow through all the information and come out with something I can really use.
I've done enough rambling - all this is to say thanks for a stimulating discussion.
Thanks Paul and Ginny, such good points you make, thanks for the discussion.
As much as I like social personal finance sites, I do worry that the burden to entry of the average banking customer (as opposed to us in the industry) is too high.
I agree that seeing my finances in my regular online banking session is easier, but I want to see my aggregated accounts from all the different FIs I deal with (accounts and credit cards) in order to get a reality check, plus add in the wisdom of crowds.
There are lots of really interesting steps taking place and at some point someone will design a winning combination that mixes all the ingredients together in a new and interesting way.
In the meantime, I'm really enjoying all the innovation that's taking place and finding real value in each one.
Hey William, thank you again for the excellent write ups. I find your last paragraph very indicative.... when CUs were founded, they didn't think of themselves as financial "institutions". They were people banding together to help each other out. Now we have some CUs being run like banks, while others remain true to the movement (and that's an attitude that can't be measured by size). Fascinating that these innovative companies are jumping into the void that CUs are missing. Where are the CUs in all of this? Why were there no CUSOs presenting at Finovate?
Thanks for your thoughts William - always love the way you thing. Sorry taking me so long to cogitate back - been swamped.
Hmmmm.... definitely understand there's always a market for the visual versus the auditory - and that each market will self select (ah the joy of democracy in action). I just wonder if we need to be thinking more along the idea of Shevlin's Killer Tweak concept - to quote him "It’s that one little service enhancement, one simple application functionality addition, one new product feature, etc. that just makes a disproportionate impact on the customer experience by adding convenience, improving quality, or reducing cycle time."
With that in mind - and trying to leverage existing tech, here's a thought towards breathing new life into phone banking systems - what about tying the two approaches (voice response/web data) more closely - imagine a session where I call into the bank from my cell while driving (hands free of course) and start a voice recognition session. I get balances, hear what checks clear, even transfer funds - but want a detail of the session, or a recent transaction history sent to my cell or email. I say "send session and transaction history to CELL" and hangup. Not a huge leap in tech - but maybe a nice combination of both voice and data tech to meet the needs of the hearer and the looker.
@Ted - I really like your thinking here. Such a nice combo of different features, and it may breathe life back into IVR (or am I off base here, is there still lots of life left in IVR?)
Is anyone doing what you suggest, any vendors providing this service? Or did you just give away a key strategic initiative? If so, hey thanks!
Always appreciate your comments, Ted. Your experience and insights are so incredibly helpful.