Author: Jim Bruene

Carbon Neutral Banking

By Jim Bruene Posted on
Categories: Green Marketing

For the next 18 months, partly because it’s an issue that deserves attention and partly because of the inevitable hype politically-correct issues get during the U.S. presidential election process, climate change will be in the news more and more. And expect politicians to join musicians on the green bandwagon, buying carbon offsets so they can call their campaigns "carbon neutral." 

While it's hard to determine yet whether purchasing carbon offsets will ultimately help the planet, we do know that being a good "environmental citizen" has great marketing appeal.* So much, that it even has its own name, "green marketing" with 340,000 online mentions according to Google. Credit unions and bank, large and small, have joined in, some making billion-dollar commitments (see previous coverage here).

Whatever your motivations, if you are looking to join the carbon offset trend, a company you should look at is Toronto's Zerofootprint, a non-profit information clearinghouse and source of carbon credits (see it's "carbon store" here).  The company, who's website drips "Web 2.0," helps users figure out what their carbon "debt" is and to buy their way into the neutral zone (or you could go even go "carbon negative," if you bought more credits than your energy-consuming debits required). A consultancy in the field is The CarbonNeutral Company.

To see how businesses can work with Zerofootprint, check out the co-branded calculator accessible through the Air Canada website (hosted by Zerofootprint here). Travelers can determine the exact carbon cost of their trip and purchase offsets immediately with the button at the bottom of the calculator (see screenshot below).  

Air Canada carbon offset calculator

Financial Institution Opportunities

  • Allow customers the option of going "carbon neutral" with their banking: Banks could follow the Air Canada example, and allow customers to go offset the carbon costs of their banking activity. Customers would enter their average number of trips to the bank, what type of car they drove, distance, and so forth. Customers with estatements would have to purchase less than those that had them delivered. So "carbon neutral banking" would be a great reinforcement of banking online. For extra credit, configure your calculator to show the gasoline cost of the trips to the bank.
  • Go carbon neutral with online banking: Using Zerofootprint or other carbon exchanges, purchase enough credits to make your online banking service carbon neutral. You could also do the same thing to designate certain branches, divisions, or the entire company "carbon neutral."
  • Use carbon credits as an incentive to bank online, sign up for estatements, use self-service, and so on. For example, you could offer to offset 1 tonne of carbon for everyone that signs up for estatements (cost is about US$9 through Zerofootprint).

—-

*I do not mean to sound cynical here. I personally like the idea of carbon offsets and am buying them through Zerofootprint.

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Bank of Stockton First to Launch Text-Based Mobile Banking via ClairMail

By Jim Bruene Posted on
Categories: Bank of Stockton, ClairMail

ClairMail landed its first bank client last week,
Bank of Stockton <bankofstockton.com>, a $2 billion financial institution headquartered in Stockton, California. It's big news for ClairMail in need of a U.S. contract signing to legitimize its text-based banking approach in its home market. The company made the most of the win with a detailed press release (here), proactive outreach to journalists, and a prominent link on its website.

Bank of Stockton, however, missed a great opportunity to bag some free publicity. There is not a single mention of the new mobile service on the bank's website. They didn't even bother posting the press release. A search for "mobile banking" and similar terms all returned "no results found" (see screenshot below).

If you are about to launch a pioneering service in a hot area, at least post a "coming soon" page and grab email addresses and/or mobile numbers to alert customers when it does become available.

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New Online Financial Services Performance Metrics from Compete

By Jim Bruene Posted on
Categories: Compete, Metrics & Market Research

Link to Compete website The researchers at Compete Inc. have developed a new scorecard that tracks the overall performance of 23 large financial institutions and lead-generations sites (note 1). We will publish this scorecard each month here at NetBanker and we will occasionally drill down into the data at Online Banking Report. To make it monthly scorecard easy to access, it will have its own category, <netbanker.com/compete>. 

There are a number of interesting insights from this data:

  • Card applications were up 9% even though shoppers only increased 1%, helping push conversion to a healthy 21%. In this case "conversion" means they APPLIED for the product. We do not know whether they were approved or not.
  • Checking applications were up 24% to 182,000, with the launch of ING Direct's Electric Orange having a role in that.
  • Home-secured loan activity was up sharply from March, increasing 30% in the refi and home equity categories. Purchase loans were also up 23% month-over-month.

Notes:

1. Companies tracked: 

Credit cards: American Express, Bank of America, Capital One, Chase, Citibank, Discover

Deposits: Bank of America, Capital One, Chase, Citibank/Citi Direct, E-Loan, Emigrant/Emigrant Direct, HSBC/HSBC Direct, ING Direct, U.S. Bank, Wachovia, Washington Mutual, Wells Fargo

Home Loans: Ameriquest, Bank of America, Capital One, Chase, Citibank, Countrywide, Ditech, E-Loan, LendingTree/GetSmart, Low.com, LowerMyBills, National City, NexTag, Quicken Loans, Washington Mutual, Wells Fargo

2. Definitions:

Shopper: Consumer who visited product-related content at a site in the competitive set. For the purposes of this Monthly Performance Update, a consumer can be counted for each site they visit. 

Application: Any Web form requiring the consumer to enter personal info including Social Security Number; counted only when completed.

Lead: Any Web form requiring the consumer to enter personal information, not including Social Security Number; counted only when submitted.

Conversion: = (Leads + Applications) / Shoppers

3. Methodology:

Compete's projections are supported by industry-leading data management and technology. The consumer and industry data is drawn from numerous sources and comprises the largest continuous consumer behavior database in the industry. Its proprietary data methodologies and patent-pending technology aggregate, transform and normalize this data and ensure it is representative of the entire U.S. online marketplace.

People are recruited to join Compete's member community through www.compete.com, the first website to help consumers personally benefit from clicksharing. Consumer data is also licensed from national ISPs and ASPs. This multi-source data collection methodology sets the industry standard for representative and actionable data. Members are protected by Compete's stringent privacy policy and data collection techniques that purge personally identifiable information.

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Hancock Bank Approaches Hurricane Season with Proactive Approach

By Jim Bruene Posted on
Categories: Public Relations, Security & Privacy

If you live in the U.S. hurricane zone, the memories of the summer of 2005 are still all too fresh. That's why it's great to see Gulfport, Mississippi-based Hancock Bank take a proactive approach to storm season with its "storm readiness" plan released in a June 1 press release (here).* 

While normally, your disaster planning efforts rate no more than a deep link on your website, Gulf Coast residents need more prominent reassurances. Hancock does a great job reassuring customers in its press release covering these four areas of storm preparation: 

  • Designated certain branches "lighthouse branches — beacons to safety." These branches stay open as long as possible and re-open as soon as possible. Emergency procedures for employee communications, food, shelter, back-up power, and fuel are detailed.
  • Offsite backup for its website and online banking so there will be "virtually no downtime." 
  • Data center precautions, including safeguards at its main center, dubbed "the fortress," plus plans for emergency off-site backup.
  • ATM system procedures and priorities in the event of a prolonged emergency.

Analysis
Overall, this is a good press release and sound plan, especially the concept of "lighthouse branches" which play off the company's logo and branding. It should receive good play in the local media.

However, I couldn't find this info anywhere on the bank's website, other than the press release buried in Investor Relations. This time of year there should be a prominent link to the bank's plan on the homepage or at least in the personal banking section. If you were looking for a new bank in the Gulf area, this would help your decision.

And financial institutions should do even more by making online banking and electronic communications prominent in the disaster plan. Here are eight additional ideas. While, some would require product development, they are relatively minor projects. Financial institution benefits are in italics.  

  1. Create a "customer communication plan" that send emails or text messages to customers to keep them informed of developments with branch, ATM, and online banking outages. 
        Helps bump up online banking and email registrations. 
  2. Remind customers how important it is to have up-to-date email addresses and cell phone numbers on file. 
        Helps improve your delivery rate on marketing and
        service messages.
  3. Since customers may not have power, they may need to rely on mobile phones for information. And since waiting on hold uses up precious phone charge time, create a call-back plan for emergencies. Customers would call or text the bank requesting a call back on their mobile.  
         Helps differentiate you from the competition.
  4. Create an "open branch & ATM" query. Customers could send a text message requesting a list (with address, phone number) of all open branches and ATMs.  
         Again, differentiates you from the competition.
         And if ever needed, will help create lifetime customers.
  5. Let customers use designated branches to charge phones or laptops in the event of widespread power outage.
         More differentiation and customer advocacy.
  6. Develop a blog that can be used to keep customers apprised of any changes to banking services. Several employees should be prepared to update the blog through mobile phones if power was out. And at least one person should have access to a satellite phone so they can remotely post updates to the blog (perhaps working with someone outside the disaster zone, who can do the actual typing/posting).
         Another great relationship builder.
  7. The Web-based branch finder should include a search for "lighthouse branches." 
         Expose your impressive disaster preparations to
         prospective new customers.
  8. Refer customers to disaster preparation website resources for so they can put together household stockpiles and family communication plans.
         More customer advocacy, not to mention the "right" thing to do. 

*Full disclosure: We have done some website evaluation work in the past for Hancock Bank.   

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New Online Banking Report Now Available: Social Personal Finance

By Jim Bruene Posted on
Categories: Online Banking Report, P2P Lending, Personal Financial Management, Social Networks

Link to Online Banking Report Wow, I can breath again. I just loaded the latest Online Banking Report on to our website, Social Personal Finance: Will social networking revolutionize personal finance? I'll post a summary later. Subscribers, you can download it now (here) free of charge. Everyone else, it's US$395 on its own, or for "just" $700 more you get the new report plus a stack of others, including our report on Web 2.0-ing your Bank, Mobile Banking, Mobile Payments, the latest online banking forecast and more.

Thanks to Scott at Payments News and Colin at The Bankwatch, who've already given the report a mention. And thanks to the Bryan Donovan and the folks at Compete, who provided a new online financial services data snapshot that I know you are going to find extremely valuable. More on that tomorrow.

Now, back to our regularly scheduled blog.  

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New Person-to-Person Lender Loanio Readies for Launch

By Jim Bruene Posted on
Categories: Loanio, Loans & Credit, P2P Lending

Just as the dust was clearing from the latest social lending launch, Lending Club, which opened on Facebook exactly one week ago (coverage here), we received word of another P2P lending exchange Loanio. The founder is revealing little about the new company at this point, but you can see from its logo and tagline, People Lending to People, what market it has its eyes on. 

Loanio's one-page website allows you to enter your email address for future notifications. We'll be covering all six North American P2P lenders (see note) in an upcoming update to last year's Online Banking Report on the market for P2P loans. (Hint: we will publish a longer-term forecast which will show more robust opportunities past the 2006-2011 period we looked at in our last report.)  

Note:

Right now the North American market consists of five pure P2P lenders:

  • Prosper (US, launched Feb. 2006)
  • Zopa (UK, but coming to the US in 2007)
  • Lending Club (US, launched 25 May, 2007)
  • Community Lend (Canada, not launched)
  • Loanio (US, not launched)

Plus, P2P loan servicer:

  • CircleLending (now owned by Virgin USA, launched 2001)

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Someday, Maybe You Will "Wesabe" Verizon Before Signing that Two-Year Contract

By Jim Bruene Posted on
Categories: Intuit, Personal Financial Management, Wesabe

You know you have it made when your company becomes a verb. Everyone on the planet knows about Googling. Then there is MapQuesting directions to the party, Yelping the best Thai food South of Market, and in financial services, Zillowing the house down the street. Someday, you may Wesabe your wireless provider to see how much users spend there and how they rate the experience.  

At least that would fit the vision of Wesabe co-founder and CEO Jason Knight, who I caught up with over coffee yesterday in Seattle as I was putting the finishing touches on a report on Wesabe and other so-called "social personal finance" companies (note 1).

I came away with a new respect for what Wesabe is trying to do. They are not so much looking to be a Web-based Quicken, as I assumed; but more a Quicken/Google mashup, delivering consumer insights by finding meaning in millions of consumer purchases. Overall, it's more like what Google does with a billion Web pages, than what Quicken does with a few thousand transactions (for each user). 

But unlike Google, which can crawl websites at will, Wesabe must convince consumers to open up their spending files to the equivalent of a search engine crawl. To do that, Jason says that Wesabe "must make financial information interesting (to its users)" while also making it drop-dead simple to upload data to Wesabe.  

No easy task. But Wesabe seems to have a head start on making that happen. More on that in our full report (see note below).

Note:

1. Our next Online Banking Report, Social Personal Finance, will look at the entire sector. You'll find it here next week. It will include a detailed look at Wesabe and Lending Club, which is catering entirely to Facebook users (see post here), and what banks should do to compete and/or partner with this new type of financial provider.

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UK’s Co-operative Bank Goes Green at MySpace

By Jim Bruene Posted on
Categories: Green Marketing, MySpace, Social Networks

Link to Co-op Bank's MySpace page Until this week, we hadn't seen much worth writing about on MySpace, other than Cassie's page, an avatar from Wells Fargo's Stagecoach Island (here). A few dozen credit unions have posted pages that range from tolerable to atrocious using the same free tools that 16-year-olds favor. A clear recipe for mediocrity. 

But last week, UK's Co-operative Bank <co-operativebank.co.uk> posted an excellent page that reinforces its reputation as a good corporate citizen (screenshot below). There's an interactive poll about automobile taxes, a CO 2 emissions calculator, some videos, wallpaper downloads, and the usual MySpace stuff. And to drum up friends, an important measure of success on MySpace, the bank will donate 20p to The Children's Society for everyone who signs on. So far its raised about US$20 with 48 friends. But the number is growing quickly; in the last 12 hours growing more than 50%, from 31 friends to 48.

The MySpace URL uses the company's tagline:  <www.myspace.com/goodwithmoney>. The bank chose Joni Mitchell's Big Yellow Taxi as its background music, an appropriate selection. 

The Cooperative Bank's MySpace page

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Mobile Banking from ING Direct

By Jim Bruene Posted on
Categories: ING Direct, Mobile Banking

(Originally published at NetBanker.com)

Link to ING Direct mobile, redirects to loginThe latest entry in the WAP camp is ING Direct, which recently began delivering Electric Orange checking account data to mobile phones at <ingdirect.com/m>. The "m" may become a trendy indicator for WAP sites, although most have put it in front of the URL, e.g., <m.google.com>, <m.yahoo.com>. The idea is to have as few keystrokes as possible without requiring a new URL to be memorized.    

How it Works
I used my new Samsung Blackjack with Windows Mobile to access ING Direct's Mobile Orange and almost made it into my account. The /m URL takes you directly to the login page where ING Direct uses the same two-factor Passmark/RSA-powered login on my Windows Mobile device as it does on a desktop browser.

In my test, I was able to enter my customer number, although it took a while before I realized I had to "double click" on the Enter button. Then I correctly answered the two security questions after several tries, and my personal picture and phrase were displayed. But I could go no further. ING Direct would not accept my PIN, which worked fine on the desktop moments earlier.

There are several explanations for my problem. It's possible that the bank wouldn't let me in because my desktop session was still active (doubtful). Or ING Direct may have mistakenly kept me out (doubtful). Or it could have been user error (likely). 

Although, I used the correct PIN number, because of the limitations of my Blackjack, it's difficult to know whether you are typing numbers or letters from the keypad since they are asterisked out in the ING Direct input box on screen. I tried it with and without NUM LOCK pressed; then with SHIFT, then with FUNCTION. Anyway, I was locked out after five or six attempts, and now I can't get in from the desktop or mobile. Hopefully, it will automatically reset tomorrow so I can avoid a phone call to customer service.   

Analysis
The reason I bored you with the details of my failed login is that it points out the serious usability issues with mobile banking. Delivering services to tiny screens with tiny keypads that may or may not have dedicated alpha and/or number keys makes the entire experience much less enjoyable. And it will create a new category of support call to customer service. These drawbacks will be fixed in time, but they will be a drag on adoption in the short term. 

For more information on mobile banking, see our full report at Online Banking Report here.

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New Person-to-Person Lender, Lending Club, Hopes Facebook Linkage Allows it to Prosper

By Jim Bruene Posted on
Categories: Facebook, Lending Club, Loans & Credit, P2P Lending, Prosper

Link to Lending Club homepage Just as we are putting the finishing touches on our latest Online Banking Report, which looks at the intersection of personal finance and social networks, a new person-to-person lender launches. And how do they plan to gain traction? Through tight integration with Facebook, the second-largest social network. So we are holding the presses, and adding this important new development to our upcoming report.

We'll have much more on it later, but if you are curious now, login to Facebook and check out Lending Club (the easiest way is to login via the link at the top of the Lending Club homepage). Or read Colin Henderson's great analysis here.  

Last year, Facebook developers created a proof-of-concept personal finance app, originally called Facebank, then changed to MoochSpot (see previous coverage here). That effort was designed to show how third parties could leverage the Facebook API to create new services. It didn't take long for someone to take the bait. Within a few weeks, BillMonk created an interface to Facebook to support their expensing tracking service, now owned by Obopay. Buxfer also supports login via Facebook's username/password (post here), but does not link into the social network as yet.

But Lending Club is the first to leverage the Facebook interface to support actual financial transactions, in this case lending/borrowing. The company is modeled after Prosper. Lending Club timed its launch to coincide with the Facebook developer's meeting and launch of Facebook Platform.

We'll be testing it during the next few days and will report back on whether its a challenge to mainstream lending, or merely blog fodder. Given the rising power of social networks, my guess is the former. 

LendingClub homepage from outside Facebook

LendingClub homepage mockup

LendingClub homepage from inside Facebook

LendingClub page inside Facebook

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ING Direct Adds Mobile Banking

By Jim Bruene Posted on
Categories: ING Direct, Mobile Banking

Link to ING Direct mobile, redirects to loginThe latest entry in the WAP camp is ING Direct, which recently  began delivering Electric Orange checking account data to mobile phones at <ingdirect.com/m>. The "m" may become a trendy indicator for WAP sites, although most have put it in front of the URL, eg. <m.google.com>, <m.yahoo.com>. The idea is to have as few keystrokes as possible without requiring a new URL to be memorized.    

How it Works
I used my new Samsung Blackjack with Windows Mobile to access ING Direct's Mobile Orange and almost made it in to my account. The /m URL takes you directly to the login page where ING Direct uses the same two-factor Passmark/RSA-powered login on my Windows Mobile device as it does on a desktop browser.

In my test, I was able to successfully enter my customer number, although it took a while before I realized I had to "double click" on the Enter button. Then I correctly answered the two security questions after several tries and my personal picture and phrase were displayed. But I could go no further. ING Direct would not accept my PIN, which worked fine on the desktop moments earlier.

There are several explanations for my problem. It's possible that the bank wouldn't let me in because my desktop session was still active (doubtful). Or ING Direct may have mistakenly kept me out (doubtful). Or it could have been user error (likely). 

Although, I used the correct PIN number, because of the limitations of my Blackjack, it's difficult to know whether you are typing numbers or letters from the keypad since they are asterisked out in the ING Direct input box on screen. I tried it with and without NUM LOCK pressed; then with SHIFT, then with FUNCTION. Anyway, I was locked out after 5 or 6 attempts, and now I can't get in from the desktop or mobile. Hopefully, it will automatically reset tomorrow so I can avoid a phone call to customer service.   

Analysis
The reason I bored you with the details of my failed login is that it points out the serious usability issues with mobile banking. Delivering services to tiny screens with tiny keypads that may or may not have dedicated alpha and/or number keys makes the entire experience much less enjoyable. And it will create a new category of support call to customer service. These drawbacks will be fixed in time, but they will be a drag on adoption in the short term. 

For more information on mobile banking, see our full report at Online Banking Report here.

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NY Times Reviews Citi Mobile

By Jim Bruene Posted on
Categories: Cingular, Citibank, Firethorn, Microsoft, Mobile Banking

Link to NY Times article The May 24 New York Times contains a generally favorable review of Citibank's new mobile phone service (article here). Writer John R. Quain also touches briefly on Bank of America's WAP service and gives Firethorn's application a spin via BancorpSouth's mobile service.

For followers of the space, there's not much new information here. But a 1,200-word article in the NY Times is significant for the mere fact that the editor's found the subject newsworthy. 

The only downside cited, and it's a HUGE one, is the cost from the carrier. In the author's test, it cost him $2.59 in data charges for what sounded like a single Citi Mobile banking session (he did not have a data plan). Ouch. 

Here's the exact passage near the end of the article:

For example, checking my balances, making a transfer and confirming a few payments totaled 244 kilobytes, plus one text message, on Citi Mobile. Total charges from AT&T: $2.59. 

Update: Drew Sievers, CEO of mFoundry, the vendor powering Citi Mobile, emailed to say that the data charges cited in the NY Times article included the initial download. Subsequent sessions, would cost just pennies each, even without a data plan. He also said that the typical user attracted to mobile banking will already have a data plan, making mobile banking essentially free, at least from the carrier.

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