Bank of America’s $250+ Premium: Richest Ever?

Bank of America is offering $250 for new customers willing to open a checking and savings account. And customers willing to play the "Keep the Change" debit-card game could easily rack up another $20 to $50 or more in freebies with the bank's three-month, 100% match (bonus averages $0.50 per debit card transaction). See our previous coverage here.

Wow! Even adjusting for inflation, that's about 10x the free toaster deal of the 1960s. Here's the link (screenshot below).

There is only one "catch" to the offer. It applies only to consumers outside the bank's sprawling branch network; however, we were able to see the offer no matter what state we entered into the initial screen.

But as long as you live in Nebraska, North Dakota, or other non-BofA states, it's very easy to earn the $250. Just drop $100 in savings and $25 in checking and the bank will triple your outlay. There's no direct deposit or online bill payment requirement, the norm for most online offers. However, the MyAccess checking account is only free if direct deposit is used, otherwise it costs $5.95/mo.

Bank of America $250 offer CLICK TO ENLARGE

Credit for first posting the offer goes to SlickDeals.net. We saw it first at BankDeals

Podcasts and RSS Feeds from City National Bank

We are starting to see RSS feeds used at public financial institutions, primarily to keep shareholders up-to-date on new filings and press releases.

Consumer feeds are still relatively rare, but are growing quickly. By this time next year, we predict as many as half of all major U.S. banks and credit unions will be producing feeds as part of their online marketing mix.*

One bank in front of the curve is Beverly Hills-based City National Bank <www.cnb.com>. The bank has seven RSS feeds and three podcasts (see below). They've even added an RSS feed button on the bottom of most website pages (see End Notes). The podcasts are just read-throughs of the articles. That's OK, but the bank should let customers know not to bother subscribing to both. 

Newsfeeds
The newsfeeds are geared primarily towards business users (2 feeds) and shareholders (3 feeds), but there's also a Personal Finance feed and a Market Perspectives feed. The bank has published three Personal Finance articles so far: the first on Aug. 16; another two weeks later on Aug. 30; then, after a two-month hiatus, a third one today.

City National Bank RSS list

Podcasts
The bank is also podcasting more thoroughly than we've seen before, with not one but two monthly podcasts: personal finance and international business. The company also produces a weekly market perspectives podcast (see list below). Users can subscribe to the audio reports via a newsfeed (RSS) or directly into Apple's iTunes using the appropriate button.

City National Bank podcast listing

*Preliminary forecast. See the final forecast numbers in our upcoming report, Online Banking Report #135, Web 2.0-itizing your Bank (to be published in early November).

End Notes (click on link below for more screenshots)

City National homepage includes links to newsfeeds (lower left)
Note also: link to remote deposit capture service (mid-page)

Citynational_home

RSS page loads whenever clicking on an RSS link from another City National page (see RSS button in lower-right corner)

Citynational_rsshome

City National podcast directory (note the integrated iTunes button)

Citynational_podhome

Prosper Markets to Savers at Google

If you thought it was tough competing with the direct banks and their 5% savings products, now you have a legitimate company advertising rates of 8% or more. Of course, this is no FDIC-insured product; it's the interest rate paid to lenders at Prosper's person-to-person loan marketplace.

The person-to-person lender was bidding aggressively today at Google on both "high yield savings" and "online banking." The ads typically made the fourth position in the right-hand column, putting them "above the fold" (see inset).

The company is testing three different ads, all focused on rate levels substantially higher than the 5% to 5.5% advertised by the competition. Prosper is testing a straight up "8%" ad, an "8% to 12%" ad, and an "8% to 29%" one (see below). 

The ads lead to one of two landing pages. Here's the slick one that looks more "bankerish": 

Landing page from Google ad

Or the more "Web 2.0" version that no one will confuse with a bank ad. There is even a small eBay logo visible in the screenshot (used by one of the participants seeking to bankroll an eBay store), a smart touch for a company that is positioning itself as "the eBay of lending." 

All-in-all, it's a good effort put forth by Prosper, which can only succeed if it attracts enough money into the marketplace. 

For more information on Prosper, Zopa, and the entire person-to-person market, see Online Banking Report #127.


Mortgagebot Offers Custom Mortgage Rates Widget

Mortgagebot widget for Fairwinds Credit Union Mortgagebot LLC, the online mortgage spinoff from M&I, has introduced an online widget for its clients (see Fairwinds CU version inset). The widget allows users to keep current mortgage rates visible on their desktop.

Typically, it would appeal primarily to someone currently in the market for a mortgage or refi where an 1/8 difference in rate can add up to thousands over the life of the loan. 

So far, seven of Mortgagebot's 600 clients have posted the widget at Yahoo's widget center; however, many more offer the service through their websites.

The first widget posted on Yahoo was uploaded Aug. 28 for Northwest Savings Bank and has been downloaded 711 times. In total, the Mortgagebot widget has been downloaded 2,200 times.

  • Northwest Savings Bank (national), 711 downloads since Aug. 28
  • Fairwinds Credit Union (Florida), 215 downloads since Sept. 27
  • Vista Federal Credit Union (California), 330 downloads since Sept. 27
  • Gateway Community Bank (Iowa, Nebraska), 275 downloads since Oct. 2
  • Northwest Bank (national), 351 downloads
    since Oct. 3 
  • Macon Bank (North Carolina), 216 downloads
    since Oct. 12
  • Riverside Bank of Florida, 127 downloads
    since Oct. 12

For more information on creating a desktop presence, read Online Banking Report #85, Grabbing Desktop Mindshare. Also see our previous coverage here.

FFIEC Multi-Factor Scorecard: 30 Banks and Credit Unions Disclose Security Solutions

There seems to be a new announcement every day about a bank or credit union intent on stalling this or that security solution to comply with the FFIEC's year-end guidelines (see previous coverage here).

However, if you drill-down through the press releases, usually initiated by vendors, details are sketchy. In fact, according to the Glenbrook Partners in-house security wizard, Linda Elliot, only 26 U.S. financial institutions have disclosed specific security solutions from a total of 13 vendors. Her most recent scorecard, as published in the consulting company's Payments News, is here.

We added another three credit unions to bring the total to 29:

Banks (22)

  • American Bank (RSA)
  • AMSouth Bank (vendor not disclosed)
  • Associated Bancorp (Corillian)
  • Bank of America (RSA/Passmark) our post
  • Barclay’s (RSA)
  • Citibank (Consumer: Entrust; Business: VASCO DigiPass)
  • E*Trade (RSA SecurID)
  • Farmer's and Merchant's Bank of Long Beach (RSA/Passmark)
  • Frost Bank (RSA/Passmark)
  • ING Direct (RSA)
  • M&T Bank (Corillian, Cydelity)
  • Nevada State Bank (RSA/Passmark)
  • North Fork Bank / All Points Capital (Arcot)
  • Northern Trust (Verisign)
  • Silicon Valley Bank (Bharosa)
  • Stonebridge Bank (RSA)
  • The Bankers Bank (Digital Persona)
  • United Bankers' Bank (Digital Persona)
  • U.S. Bank (Entrust)
  • Washington Mutual (RSA)
  • Wells Fargo (Bharosa, Quova, Actimize, RSA SecureID,
    Symantec)
  • Zions Bank (RSA/Passmark) our post

Credit Unions (7)

  • Automotive Federal Credit Union (BioPassword)
  • North Island Credit Union (RSA/Passmark) our post
  • Schools Financial Credit Union (RSA/Passmark)
  • our post

  • Desert Schools FCU (Bharosa)
  • FORUM Credit Union (BioPassword)
  • Parda Federal Credit Union (BioPassword)
  • Stanford Federal Credit Union (RSA/Passmark) our post

Blog Sighting: Toronto Electrical Utilities Credit Union

Toronto Electrical Utilities Credit Union <teucu.com>, the ninth North American financial institution blog, and third in Canada, debuted Aug. 15 at <teucu.ca/blog>. The other eight are listed here.

The CU has done a reasonably good job keeping the blog alive with 11 posts in its first two months. The posts have been all business, ranging from notice of an ATM service interruption to a discussion of loan options.

The CU allows comments, and so far 13 have been posted. None were particularly interesting, mostly "thanks for the info." That will change as users understand what blog comments are for (i.e., furthering the "conversation" or adding some informational value).

The blog runs on Google's free Blogger platform (see screenshot below). It's an OK start, but the CU should invest a few hundred dollars in upgrading the template as soon as possible.

TEUCU blog CLICK TO ENLARGE

TEUCU homepage CLICK TO ENLARGETEUCU publicizes the blog in a prominent spot on its homepage (see inset).

Thanks to the guys at Trabian for the scoop.

TrueCredit Email: "Credit is Scary"

I'm a sucker for holiday-themed messages. There's something about a big, well-timed graphic that makes an email stand out from the crowd.

Here's the latest from TrueCredit, a prolific emailer to ex-customers such as myself. I usually hear from them every week or two.

Date: Tue 24 Oct 2006 9:27 AM
From: TrueCredit [truecredit@email.truecredit.com]
Subject: Autumn Special: James's 3 credit scores

Personalization used: My first name in the subject and message body

TrueCredit Oct. 24 email to ex-customers CLICK TO ENLARGE

South Carolina Federal Credit Union Fails to Simplify its Homepage

It's not often that a press release leads directly to a Netbanker post, but here's an example. We received an announcement last week that South Carolina Federal Credit Union <scfederal.org> was launching a complete rebranding under the "life simplified" theme (press release here).

We eagerly headed to its homepage, expecting to find a site that did for banking what Google did for search. In other words, a website that instantly lays out the critical tasks for online banking customers.

What we found was good, and light years ahead of its old homepage (see End Notes below), but it was not revolutionary. The homepage design follows most best-practices including the left-hand log-in area, tabular main navigation, and site search and other utilities in the upper right.

The first navigation tab is Convenience. That's an unusual choice that could help the CU differentiate its member benefits. However, the laundry list of electronic and online banking features cited have been industry standards since 1997.

Google homepage CLICK TO ENLARGE Website visitors are not going to walk away thinking "that credit union really saved me time." If anything, the homepage is somewhat cluttered with 80 hyperlinks, many in small type, plus another dozen or so in two lefthand, drop-down boxes. Five choices are simple (see Google above). Eighty are not. 

The credit union missed a great chance to build a website that clearly directs users towards what they most want from their credit union: online access, customer service, and research.

Grades
Homepage design: A- (a bit cluttered)
Navigation: B (too many choices)
Homepage fit with "life simplified" branding effort: C-

South Carolina FCU CLICK TO ENLARGE

End Notes (click on the link below to see the old homepage)

Previous homepage (from Google cache, Oct. 3)

Southcarolinacu_home_old

Prosper Launches Group Ratings, Schedules User Meeting

Person-to-person lender, Prosper, announced its first annual user meeting next February in San Francisco. Registration is a refundable $25 and includes an all-day session with dinner on Monday, Feb. 12, and a half-day on Tuesday, Feb. 13.

The agenda has not been published. Online signup is here.


The October newsletter (see End Notes for screenshot) also announced the arrival of the group ratings, an important milestone for the nine-month-old service. Group ratings promise to help lenders locate borrowers with better-than-expected likelihood of repayment. If it works, Prosper could become a major force in consumer lending. If it doesn't, the company will have to find another way to beat the loan default odds. 

For more information:

  • For prior coverage of Prosper and its U.K. rival Zopa, look here.
  • For detailed analysis of the market, see Online Banking Report #127 published in March

End Notes (click on the link below to see Prosper's Oct. newsletters)

Banner advertising at About.com's banking blog <bank.about.com>

Bofa_ads_aboutdotcom

Landing page for direct navigation to <bankofamerica.com/nofeemortgage>

Bofa_nofeemortgage_url

Landing page from bank's Google ad on "bank of america mortgage no fee"

Bofa_mtg_landing

Bank of America’s Multimedia No-Fee Mortgage Promo Omits Key Search Term

When Bank of America launches a new product, you might as well try to ride on their coattails rather than fight it. One obscure loan-referral website is doing just that.

Bank of America's product-du-jour, at least in our Seattle market (UPDATE 10 Jan 2007: Confirmed as a market test in this article here), is a unique no-fee mortgage that comes with a built-in "refi" option. The refi feature allows users to lower their underlying mortgage annually if rates drop. It's a product that makes a ton of sense for today's savvy mortgage holders, who know when to hold 'em and also when to fold 'em into lower-rate loans.

The bank has been blitzing the market with branch, Web (see End Notes), and radio advertising for the product. Today's mid-day radio spot included a URL in the call to action, <bankofamerica.com/nofeemortgage>. Typing that URL directly into the browser leads to the correct Bank of America landing page (see screenshot in End Notes).

However, for a good portion of listeners that navigate with Google, typing "bank of america no fee mortgage" brought search results that did NOT include the bank as an advertiser although they were the second organic result listed (see screenshot below).

Google search results for "bank of america no fee mortgage"

Google search for "Bank of America no fee mortgage" CLICK TO ENLARGE

Surprisingly, the top advertiser, YourQuoteOnline, was running an ad that was rather deceptive (see screenshot above). It fooled me into thinking it was a BofA ad.

A similar search for "Bank of America mortgage no fee" did bring up the bank's Google ad (see below), although it linked to a "$2,000 savings" landing page (see End Notes) instead of the no-fee promotional page. Evidently, Bank of America has not properly coded their search-word criteria to include the more obvious search term or to send searchers to the current no-fee campaign page. The bank is leaving money on the table by allowing some of the traffic generated by its advertising to be funneled off to other companies.

Google search results for "bank of america mortgage no fee"

End Notes (click continuation link for footnotes)

Banner advertising at About.com's banking blog <bank.about.com>

Bofa_ads_aboutdotcom

Landing page for direct navigation to <bankofamerica.com/nofeemortgage>

Bofa_nofeemortgage_url

Landing page from bank's Google ad on "bank of america mortgage no fee"

Bofa_mtg_landing

Billeo Scores Distribution Deal with Target REDcard

Automatic bill pay description at Target.com CLICK TO ENLARGEIn a distribution deal similar to the Visa.com partnership launched earlier this year, Billeo is now powering biller-direct payments for Target's REDcard (see inset). See previous coverage here.

Billeo received an Online Banking Report Best of the Web award in 2005 for its innovative toolbar-based payment services (see 15 March 2005 post).

How it works
New users start by searching for credit-card-accepting billers via zipcode and company search (see screenshot below).

To schedule a payment and use the other tools, users must first register with Billeo. While the initial biller-search screen runs under Target branding, the sign-up page and subsequent user interfaces do not maintain any Target branding.

Previous Billeo users can skip the registration process and simply sign in to their previous Billeo account.

Biller search powered by Billeo CLICK TO ENLARGE

Bank of America Adds 760,000 Users in Third Quarter

Although growth has slowed, as it must when you have the penetration of Bank of America, the company still managed to add 760,000 active* online banking users and 430,000 active* bill pay users in the latest quarter. The bank's $15 enrollment bonus surely helped boost the total (see Aug. 11 post).

Excluding PayPal with 31 million active users (includes international accounts, see previBofA active users CLICK TO ENLARGEous post), Bank of America continues to hold a large lead over the next largest U.S. online banking base, Wells Fargo's 8 million.

Although the bank posted an impressive 6.3 million gain year over year, about 4.5 to 5 million of that appears attributable to the MBNA acquisition (see chart below).

Bank of America Active* User Base
Qtr  Online Banking   Bill Pay
2006 (includes MBNA)
Q3….20.6 million   10.8 million 
Q2….19.8 million   10.4 million
Q1….19.6 million   10.1 million

2005 (excludes MBNA)
Q4….14.7 million    7.3 million
Q3….14.3 million    7.0 million

*BofA defines Active as having used the service in the past 90 days.

BofA bill pay volume CLICK TO ENLARGE On the bill-pay front, the bank processed $49 billion in payments for its users during the quarter, up $2.1 billion over the previous quarter (+4.5%). The average payment amount was $4,500 per active bill pay user, or $1,500 per month with 84% of the payments delivered to the payee in electronic form (ACH).

The bank also reported e-bill delivery volume of 21 million in the quarter from 370 billers.

Thanks to Scott Loftesness at Payments News for digging through the bank's 47-page earnings supplement for these gems (see pp. 18-19).