Bankers debate today’s trends at Bank Customer Experience Summit
Literally speaking, there was no round table in the Bankers Rapidfire Roundtable at the Bank Customer Experience Summit. However, there were bankers, and quite a few questions asked and answered in the 60-minute presentation.
Here, in edited form, are selected ‘Q’s and ‘A’s tackled by a panel that included Phil Leininger, general manager of omnichannel sales and service at USAA Bank; John Piazza, assistant vice president of digital innovation at MB Financial Bank; and Katherine McGee, head of digital at Wells Fargo.
SC: What are the biggest regulatory headaches banks are facing right now?
PL: As we start to move into new types of technology having regulators that understand artificial intelligence machine learning big data and some of those things is going to be critical. So we have a responsibility, I think, as an industry to help teach those things. Being a compliant company, I think, is our No. 1 commitment. Because without being a complaint company you can’t actually offer the products and services and advice that you want to.
WH: Do you get worried at all when when you see something like what happened when Facebook went to Capitol Hill where regulators and senators and Congressmen and -women didn’t understand social media networks, much less something like AI?
JP: Whenever you have regulators or legislators who don’t understand what they’re debating that poses a problem. … I think banks and the lobbyists employed by banks have done a very good job — and even regulators themselves — have done an outstanding job over the past year-and-a-half educating themselves on developing technology, so I think we’re in a much better position than we’ve been in.
WH: In terms of the biggest opportunities for banks, what are they looking at right now in terms of differentiating their products from other banks and then fintech companies?
PL: I love what the techs have done because they’ve really spurred banks and financial institutions to get better. And we’ve been able to take some of those ideas, we’ve been able to integrate some of those companies, and we’ve been able to use those [innovations] to offer a much more robust product set.
KM: How many people here have ever misplaced a card? … Normally you would have to call, you get a new card and then a month later you find out that your gym membership wasn’t paid you get the nasty letter from them. … So what we’re trying to do is “control towers” that bring all of it together so that when you misplace your card you can go to the control tower, turn [the card] off and you can see all the merchants it’s attached to and then you can update that. … You really try and transform what a customer has to do so they can go and live their life.
SC: How does the OCC announcement about fintech charters change the landscape for you?
KM: It doesn’t change it. I mean that the world is dynamic. There’s new technology launching every day; there’s new companies launching and solving new problems. I think what it does is it force us to be nimble and agile in how we’re looking at the world and our customers and the needs that they have.
JP: I think it’s a good thing. What will be far more impactful, I think, to the banking landscape is if and when other regulators like the FDIC allow a limited-purpose bank charter maybe similar to the industrial loan charter. … If the FDIC starts letting them hold deposits, that becomes very disruptive.
WH: What does this group think about just the competitive threats outside of outside of fintech retailers and things like that?
JP: I would say Apple, Google and Facebook specifically have already made entries into the financial services space. So you’re obviously familiar with Google Wallet and with Apple Pay. Facebook has started allowing money transfer through their app. … So, if they start to move more into financial services like has been done in developing countries, that can be a big threat.
KM: The fact that my daughter can get her school supplies delivered to her house in two hours means that real time or near real time is critical. We can’t sit around and say it’s OK that it takes four days to get a payment somewhere. It’s just not acceptable anymore. So I think we really need to look at what influence nonfinancial services industries and experiences customers are having, and what does that mean to us.
SC: There are questions about mobile devices having some some security vulnerabilities, and then you have the way that consumers use their devices. How how do you handle security from that perspective?
PL: The human channel accounts for 4 to 6 percent of our interactions with customers and accounts ultimately for 60 to 70 percent of the fraud. So from that standpoint we are trying to remove the authentication burden off of the human in order to get more secure. I often wonder though… If there’s going to have to be some [consumer] participation level because until then the customer really doesn’t have much of an incentive to safeguard their information.
WH: There’s all this data out there … are banks using big data to its full potential? And what needs to happen going forward?
KM: I think there are banks that use it very well and there are other banks which are just beginning to understand what clean data looks like and how to get there and actually what to do with it. … [And] even if they have the capabilities and they have the skill set internally to be able to do something with it, they don’t have the vision of what to do with it. I think looking into some of the more innovative companies both inside and outside of finance can provide some guidance there.
PL: What’s happened over time is that we’ve started to look across [silos] and if we could accurately cut across all of those data points we’d be a much richer proposition to our members. … I think that if you let your data go in silos and if you let big data happen narrowly instead of broadly, you’re going to miss significant opportunities.
SC: Technology is changing at a pretty fast rate. So what are the pros and cons in making the determination about investments in technology?
KM: I think in most cases technology can really help us. Some technologies are still playing out and we haven’t taken full advantage of them. … And I think we’re just harnessing some of that power.
JP: If you’re left with the decision invest in technology or don’t invest in technology, invest in technology. [But] don’t invest in every new technology that comes out. There’s a multitude of new technologies. They’re expensive and time consuming and they will suck your focus. So, make sure you invest in technologies that matter.
Republished with permission from Mobile Payments Today