Homage to Catalonia
Back in May, I chaired the 2012 Future of Mobile Banking conference held in London, writes Karl Rieder, delivery manager, GFT. At the event, I expressed my disappointment with the state of mobile banking (and with my own bank, in particular).
It’s clear that banking hadn’t yet taken full advantage of the new technologies which have so revolutionised other industries such as media, advertising, retail, or music.
Six months on, there has been some improvement, but overall, the picture hasn’t changed much.
While all of the four large retail banks in the UK have mobile applications, their quality is varied and generally, not very good: customer reviews of their iOS versions range from 1.5 to 3 stars out of 5. Standard functionality such as viewing account balance and recent transactions, finding ATMs and branches, and making transfers is common place, but there isn’t much else on offer. The most notable exception is Barclays Pingit, which allows any person with a UK bank account to transfer money to any other Pingit user.
In this regard, the UK is trailing what is being done abroad. For example, some very interesting things are happening in Catalonia.
La Caixa, Spain’s third largest bank, not only offers a wide variety of mobile apps to its customers, it even has its own app store. There is of course a core banking app far better than its UK counterparts, but also a host of smaller, focused apps. These include apps to track stocks, view credit card movements and balance, load a pre-paid phone card, pay bills, convert currencies, set up payment by instalments, block a credit card, deposit a check, etc. etc. In fact, there are over 50 apps for a variety of phones and tablets. La Caixa has also extended its ATM-based “ServiCaixa” system to mobile. Amongst other things, this lets La Caixa customers buy tickets for the cinema, concerts, theatre, sports, museums, and other events. La Caixa has been able to take its wide range of offerings and successfully get them onto the phones of their customers.
Banc Sabadell, another Catalan bank, has taken a bit different approach. It has used new technologies such as mobile and social networking to improve customer services and sales. Their motto “bring the bank with you” gives you a good idea of where they are and the direction they are heading. Banc Sabadell has created very user-friendly apps which aim to encourage a more direct interaction with the bank in order to deepen the relationship. Their strategy is particularly focused around social networking.
Some banks in the UK have started to use social networks for marketing purposes – the viral aspect of these networks allows the bank to intensify brand awareness not only with its own customers but with their customers’ “friends” as well. For example, Barclaycard has created a social community for users of their credit card. HSBC has also taken some steps into this arena with its “Values Campaign”, which looks to create discussion around topics not even related to banking. Barclays uses Twitter to respond to customer queries.
Banc Sabadell, though, has defined its mobile strategy around social networking. It is working to closely join the bank’s customers and employees, so that they can establish a more active and close relationship with one another. The mobile becomes the first and most important connection the customer has to the bank, but in a way which remains human.
The use of new technologies doesn’t come easy, and there is resistance. With mobile applications, there is still a perception by the public that mobile banking may not be secure. In the most recent survey that I have read, nearly two-thirds of UK smartphone owners still have not yet adopted mobile banking because of security concerns.
With social networking there are also regulatory issues. Consumer privacy and maintenance of records of social media activity are just two examples of the many issues which are affected by the regulatory environment.
UK banks are struggling with technical questions as well. IT departments are weighing-in on the continuously evolving debate between using HTML5 or “native” code to build mobile apps. The problem that businesses face is that each of the different mobile platforms (the four most important being Apple iOS, Google Android, Microsoft Windows, and RIM Blackberry) uses different programming languages and environments. This means that to develop an app for all four platforms, businesses have to write four versions of the code, developed by four different teams. This of course is costly and difficult to maintain. HTML5, on the other hand, is the common denominator, providing a rich user interface for all devices – a cost-effective approach. HTML5-based apps, though, don’t have the same level of performance nor the degree of integration with the mobile phone functionality such as the camera, GPS, compass, calendar, contacts, accelerometer, etc. So, banks have to make strategic decisions about what technologies to use. These are decisions which will affect not only the quality of the apps they develop, but also the staff they hire. I know that in more than one case, these decisions are holding organisations back from moving forward.
Despite these challenges, UK banks can and should do more. They are missing an excellent opportunity to improve the service to their customers and strengthen the relationship with them. This can even help to re-establish trust – something the banking sector is sorely lacking.
For me personally, as six months ago, I continue to be disappointed with my bank’s poor mobile offering. Some banks, such as the Catalan ones that I have mentioned, clearly get it; they are providing novel applications to their customers and improving the banking experience. Sadly, my bank is not one of them.
Karl Rieder is delivery manager at GFT.