Blog - Page 1147 of 1196

Bank of America Posting Content at its .mobi Address

By Jim Bruene Posted on February 19, 2007
Categories: Bank of America, Mobile Banking

Bank of America is gearing up to launch nationwide mobile access this year. The region-by-region rollout begins in Tennessee next month (see note 1 below). Few details are available, but it sounds like WAP banking, similar to Wachovia's approach announced in December. We'll analyze BofA's approach in great detail as more information becomes available. With 21 million online banking accounts, just about anything they do has the distinct possibility of becoming the de facto standard.

As you think about your future mobile offerings, one detail to be wrapped up immediately is registering your .mobi address. While it's too soon to tell if that address ever becomes popular, Bank of America, for one, has staked a claim at that site putting bank info and a zipcode-based ATM/branch locater at its .mobi address, <bofa.mobi> (see screenshot right).

We did a quick search this morning and found no other top-30 retail bank with a functioning .mobi address, at least none using the standard version of the bank's name as the address, e.g., keybank.mobi. Worse, a number of the .mobi addresses appear to be registered to domain-name squatters (see note 2), so it will take time and money to wrest those names away from the original registrants.

So if you haven't already, at least spend $20 and register your bank's .mobi address. For more details on how to launch mobile services, see our upcoming report due out later this week at OnlineBankingReport.com.

Note:

1. Some Bank of America regions have already posted the features and benefits of mobile banking at the regular website. For example, make sure you have selected "Tennessee" as your state at BankofAmerica.com, then click here to see the mobile banking section (screenshot also shown below).

2. The following addresses appear to be registered to entities NOT affiliated with the bank: suntrust.mobi, usbank.mobi, nationalcity.mobi, pncbank.mobi, capitalone.mobi, unionbank.mobi, commercebank.mobi, and zionsbank.mobi

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YADB* First National Bank of Omaha Launches FNBO Direct

By Jim Bruene Posted on February 17, 2007
Categories: Direct Banking, First National Bank

The battle for online savings deposits has another entrant, First National Bank of Omaha. The new effort, branded FNBO Direct, launched in January according to Wikipedia and other sources. It's the second new direct bank of the year, following Direct Huntington earlier this month (see post here).

Both banks offer virtually identical products. DH pays 5 basis points more, but that's only $5 more per year per $10,000. FNBO has a $1 minimum, while DH wants $1,000 to open. Both use the CashEdge instant account-opening suite, on which we've commented before (see here).

Although, FNBO Direct clearly discloses its parent bank, the new savings account is completely separate from other First National Bank of Omaha accounts. It cannot be opened in FNBO branches, nor can it be linked to FNBO online banking.

FNBO Direct is not currently advertising at Google, Yahoo or BankRate.

*Yet another direct bank

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New Account Totals for ING Direct’s Electric Orange Checking

By Jim Bruene Posted on February 16, 2007
Categories: Deposits, Checking, Savings, CDs, ING Direct, Metrics & Market Research

Yesterday, Money.com posted an article (here) citing new account totals for ING Direct's Electric Money checking account:

60,000 accounts, a 1.5% penetration of the
bank's 4 million accounts
$2.2 billion in new deposits, a hefty $37,000
per account*

Two weeks ago (Feb. 1), the bank said it had attracted 42,000 accounts (see post here).

The inset is an actual Electric Orange MasterCard debit card.

*An average of $37,001 if you ignore my $100 account

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ING Electric Orange Reviews

By Jim Bruene Posted on February 16, 2007
Categories: Blogs, Deposits, Checking, Savings, CDs, ING Direct, Public Relations

Much virtual ink has been spilled over ING Direct's Electric Orange account, and the new checking account isn't even available to the general public. From its Internet cafes to subway sponsorships, this is a bank that knows how to generate buzz, which really isn't all that easy with checking and savings accounts (see here for previous coverage of ING Direct).

Searching for <"Electric Orange" + review> on Google, we found six full-scale reviews of the product among the first 100 organic listings (10 pages of results using the default settings). All were blog postings. Most were moderately positive, and only one took shots at the bank calling the rates "too good to be true" (see Watch Your Wallet below).

It illustrates an interesting new phenomena, the power of the personal finance blogosphere. Most top-ranked search results belong not to mainstream press accounts, but to bloggers writing from various levels of knowledge about banking and finance. Most of the top-ranked blog reviews were thorough, factual, and relatively unbiased. But a few bits of misinformation creep in now and again, such as the rumor that the account stops paying interest on the sixth transaction in a statement period (false, by the way). Financial institutions should monitor these postings and jump in with a comment and/or email to the author to correct any factual errors.

Here's a list of what the personal finance bloggers are saying about Electric Orange:

1. Highest-ranked review on Google (#2 overall)

Getting-Green.blogspot.com

Date: 13 Feb. 2007

Verdict: Positive

URL: http://getting-green.blogspot.com/2007/02/banking-reviews-ings-electric-orange.html

2. Second-highest ranked blog review (#4 overall)

MyMoneyBlog.com

Date: 2 Dec. 2006

Verdict: Positive

URL: http://www.mymoneyblog.com/archives/2006/12/ing-direct-electric-orange-checking-account-feature-review.html

3. Third-highest blog review (#5 overall)

TheSunsFinancialDiary.com

Date: 30 Nov. 2006 (#7 overall)

Verdict: Positive

URL: http://www.thesunsfinancialdiary.com/2006/11/30/electric-orange-ings-paperless-checking-account/

4. Fourth-highest blog review (#33 overall)

BankDeals.Blogspot.com

Date: 29 Nov. 2006

Verdict: Neutral

URL: http://bankdeals.blogspot.com/2006/11/ing-directs-new-checking-account-now.html

5. Fifth-highest blog review (#46 overall)

NextCU.com (Callahan)

Date: 4 Dec. 2006

Verdict: Neutral

URL: http://www.nextcu.com/2006/12/electric_orange_covering_the_b_1.html

6. Sixth-highest blog review (#65 overall)

WatchYourWallet.blogspot.com

Date: 28 Dec. 2006

Verdict: Somewhat negative

URL: http://watchyourwallet.blogspot.com/2006/12/ing-directs-new-electric-orange.html

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Washington State Employees Credit Union (WSECU) Offers RSS Feeds from its Info Center (FAQs)

By Jim Bruene Posted on February 15, 2007
Categories: RSS, Service, WSECU

Every financial institution should offer feeds to its contents. It's an extremely low-cost way to reach out to the growing body of customers using feeds to track their favorite information sources (see previous NetBanker coverage here; for a detailed analysis and forecast, refer to our sister publication, Online Banking Report, Web 2.0, Feeds and Blogs for Financial Institutions #135/136).

One new approach is making your FAQs, knowledge base, or other self-service areas available via RSS feed. That way, customers interested in certain topic, say, "student loans," can stay abreast of any new information that becomes available.

One self-service solutions provider, Seattle-based Fuze Digital Solutions <fuzeds.com> has imbedded RSS feeds into its platform allowing its credit union clients to make feeds available for specific topical areas such as credit cards or online services.

You can see how it works at Washington State Employees Credit Union's <wsecu.org> Info Center, the first Fuze client to use the RSS option. Browsing the list of available topics, users are alerted to the feed option by the orange RSS button (see screenshot below). Clicking the button displays the feed URL that can be imported into a newsreader.

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Chase Bank’s $25,000 Sweeps for Going Paperless

By Jim Bruene Posted on February 14, 2007
Categories: Advertising & Promotion, Chase Bank

Habits are hard to break. After 5, 10, 20 or more years of receiving paper statements, most mainstream banking and credit card users are reluctant to give them up.

Long-term online statement and transaction archives are key to creating paperless customers. But you'll still need an incentive to get most customers to move their mouse over to the "go paperless" button.

Chase Bank devotes prime homepage real estate, and $35,000 in prize money, to the effort today in a sweepstakes aimed at convincing customers to shut off their paper statements (see screenshot below). Every customer enrolled in electronic statements receives one entry per month through April in the contest which pays a $25,000 grand prize plus ten $1,000 runner-up prizes.

Analysis
It's a good effort, but with $100 million or more in annual savings at stake, why stop the sweepstakes after just three months. A $1,000 prize should be awarded each month, or each week, for many years as the banking giant weans its customer base off paper.

Also, Chase should be more specific on the amount of statement storage available online. The landing page is vague, saying one can "gain access to several years of statements." What does "gain access" mean? Do you have to request old statements for future delivery or are they right there so that on April 14th, you can find that final piece of your tax return puzzle. Even checking the online banking area of the website won't answer that question. It merely says you can print 90 days' worth of transactions. This isn't enough reassurance to those reluctant to give up the paper trail.

Chase homepage (14 Feb 2006):

Sweepstakes landing page (14 Feb. 2006):

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Prosper Raises Prices, Adds Features on First Anniversary

By Jim Bruene Posted on February 12, 2007
Categories: Loans & Credit, Prosper

At its first annual user meeting, which kicked off today in San Francisco, Prosper unveiled a number of changes to its person-to-person lending exchange. The most interesting is that the site is no longer taking loan listings from all comers. They have eliminated the New Credit (NC) category and now require a minimum FICO score of 520 to participate (see email announcement below).

Neither change will affect loan-origination volume in a measurable way, since few of those loans were funded by investors. However, it does eliminate one of the feel-good aspects of the site, the ability for anyone to use it to start, or re-start, their credit history.

Price increase
But Prosper is first and foremost a for-profit business, so the policy change is not surprising. In the same vein, the company announced a price increase for riskier credits, doubling the loan-origination fee to 2% on high-risk (E & HR) loans, and doubling the annual servicing fee to 1% of the outstanding balance on on all but A and AA loans. Late payment fees also tripled from $5 to $15 each month. Finally, Group Leader rewards have increased up to four-fold, which will have the effect of raising rates for many borrowers.

Lender enhancements
Prosper also added several enhancements to assist lenders in evaluation loans, including:

100% identity-theft protection providing full refunds for fraudulent loan applications
ROI estimator, a tool that uses historical Prosper data to project return on investment
Public borrower Q&A: Like eBay, lenders can now ask borrowers specific questions, and the borrower can opt to answer the question with a public response to be displayed within the loan listing
Additional credit report data: Six new fields are now available to lenders, making 12 credit bureau-sourced data points for each loan listing (see screenshot below). This is a huge change from a year ago, when only the letter grade was available to make lending decisions (Prosper's full explanation of credit data available is here).

Borrower enhancements
Although attracting lenders is the key to the company's survival, Prosper added a new feature to help borrowers make their loan listing more believable, member endorsements. Now, any Prosper member, including the Group Leader, can add an endorsement or testimonial to a loan listing (see Group Leader endorsement below; the full loan listing is reprinted in the Notes section).

Borrowers can also show a list of "Prosper friends" to further enhance their credibility. The friends' network shows in the upper-right info box (see inset).

Notes:

For a more detailed look at Prosper and person-to-person lending, refer to Online Banking Report #127.
Previous NetBanker coverage is here.
Full loan listing shows endorsement (at right, click to enlarge).
Feb. 12 email announces the changes (see Lender section above, click on image to enlarge).

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Chase Attracts New Users with Catchy Button but Loses them on the Enrollment Form

By Jim Bruene Posted on February 9, 2007
Categories: Chase Bank, Forms & Loan Applications, Website Usability & Design

Over the years, Chase Bank has made impressive design improvements on its homepage (see note 1). One thing they do better than most is attract the attention of their non-online banking customers.

A large blue square surrounding an orange button beckons users to "Get a User ID" (see inset). It's well positioned in the prime upper-left corner, and it has the ubiquitous "Web 2.0" orange working for it.

Unfortunately, after clicking the button you are transported back in time to a page virtually devoid of color and design (see screenshot below). In addition, the form immediately asks for info that many users may not want to reveal (SSN) or may not have access to at the moment (account number).

Recommendations

Redesign the page to make it more appealing.
Add prominent links to customer service for help.
Ask only easy questions on the first page: name and email address is enough to
engage the applicant and provide enough info for followup if the
application is abandoned.

Notes:

1. Here's the homepage today (left) vs. the busy look four years ago (20 Nov. 2002)

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Digital Insight Now Officially Part of Intuit

By Jim Bruene Posted on February 8, 2007
Categories: Bill payment, Intuit, Personal Financial Management, Small Business

Intuit's $1.3 billion acquisition of Digital Insight closed yesterday, marking the beginning of a new era of innovation in small business online banking (previous coverage here). It's a market that's been underserved for years (see Online Banking Report's, Small- and Microbusiness Online Banking, #107/108).

Intuit, which has iPod-like domination of small business accounting and bookkeeping via Quicken and QuickBooks, can now leverage the software relationship into the banking relationship. The bloggers at Intuit's QuickBooks team-blog expanded on that theme here, discussing their goal of integrating electronic invoicing and payments into the bank site:

Why the purchase? One reason is to try to sell functionality of our record-keeping software as a service through banks, letting small businesses create, send, and get paid for invoices, all online at a bank's site. With millions of QuickBooks customers, we think we have some insight into small business' needs…. We learned from our tax return business how quickly packaged software can move to a Web service. Last year, for the first time, more people used the online version of our Turbo Tax Web service than the desktop version.

This is not necessarily bad for financial institutions. In fact, it probably levels the playing field for the smaller banks and credit unions that are the core of the DI client base. Through integration into Intuit's accounting products, smaller banks will be able to offer sophisticated small business solutions that equal or surpass what Bank of America or Wells Fargo offers today.

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Is the United States Overbranched?

By Jim Bruene Posted on February 7, 2007
Categories: Branch Banking, Metrics & Market Research

Well, not so much when compared with other Western countries; however, the bigger question is whether they are all overbranched. Only Singapore, with 111 branches per million inhabitants, is in a good position cost-wise. Italy and Switzerland, with more than 700 branches per million, have their work cut out for them as they reduce the number of branches from a level twice as high per capita as the U.S. total of 372 per million.

At our sister publication Online Banking Report, we've predicted that the total number of branches in the United States will fall by about 40% during the next 20 years (see note 1). Given expected population growth, that equates to about half the number of branches per million (using the BIS baseline, our projection is that the U.S. would have fewer than 200 branches per million in 2025). The reason for the decline is the rise of the out-of-branch channels: phone, online, ATM, and soon mobile (see note 2).

Here's some interesting data from the Bank for International Settlements <bis.org>. Click on the table below to read the five-year data trend. The 270-page PDF is located here.

Interestingly, of the 13 countries covered in the report, only Hong Kong, Singapore, Sweden and The Netherlands have fewer branches per capita than the United States. We have almost 25% less than the 13-country average. Only two countries showed an increase in the 2001-2005 period: Italy which added 1,500 branches and the United States which grew about 6,000 (see note 2).

Here's the list in order of most branches to fewest per million inhabitants:

1. Italy                 >>> 762
2. Switzerland   >>> 701
3. France            >>> 649
4. Belgium          >>> 566
5. Germany        >>> 561
6. UK                     >>> 472
<< <AVERAGE >>> 471
7. Japan               >>> 459
8. Canada             >>> 441
9. U.S.                    >>> 372
10. Sweden          >>> 295
11. Netherlands >>> 270
12. Hong Kong   >>> 249
13. Singapore     >>> 111

Notes:

1. See Online Banking Report's Decline of the Branch (#128), published May 2006.

2. Tom Brown's been writing about the trouble some banking chains have been having with the performance of their new de novo branches (see here).

3. In 2001 and 2002, the U.S. branch total in the BIS data-set excluded credit unions.

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ING Direct Books 42,000 New Electric Orange Checking Accounts

By Jim Bruene Posted on February 5, 2007
Categories: Deposits, Checking, Savings, CDs, Direct Banking, ING Direct

According to an American Banker story last week (here), as of Feb. 1, ING Direct had cross-sold 42,000 (see note 1) checking accounts to its 4.3 million savings customers, a penetration of 1%. Keep in mind, the new checking account has been slowly rolling out over the past 60 days to current customers only (see note 2), and is not yet mentioned on the bank's website. It is expected to be launched to the general public within the next 30 days.

You can view these initial results in two ways:

Glass is half full — Even with just 42,000 accounts, ING Direct may have the largest "Internet only" checking account base, at least when measured by the number of active accounts

Glass half empty — Because ING Direct's checking account pays 50 to 80 basis points (0.50% to 0.80%) more than savings on $50,000+ balances, many (most??) of the new checking account customers simply moved large balances into the checking option, providing few incremental deposits.

Notes:

Make that 42,001 accounts. I just opened one this morning. It took all of about 30 seconds to do it. Existing customers simply choose an account nickname, enter the dollar amount they want transferred into the account (from the pre-existing link from an outside account), and agree to the disclosures. See below for the confirmation screen.
I received my invitation to open an Electronic Orange account last week (screenshot here). I've had an account there since 2001.

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YADB* Huntington Goes Direct

By Jim Bruene Posted on February 3, 2007
Categories: CashEdge, Direct Banking, Forms & Loan Applications, Huntington Bank

First reported by Bank Deals today (see note 1), Huntington Bank has recently launched a new direct bank, called DirectHuntington <directhuntington.com>. It goes against the naming convention of having "direct" follow the main brand name, but it shouldn't make too much difference. Still, the bank should secure domain-name rights to HuntingtonDirect.com, currently used by New.net Inc to post a few generic banking links and throw a pop-up or two at unsuspecting users.

Huntington chose a color palette that makes it stand out from other financial institutions, a good move. However, the yellow 5.30% APR doesn't stand out as well as it should given its importance in the purchase decision (see sceenshot below).

But once again the CashEdge-powered online application leaves a lot to be desired (see previous coverage here and second screenshot below). But before you can even see the application, you must agree to the "Consent for Electronic Disclosure," a terrible first impression for someone who's thinking of sending you ten-grand or more (see screenshot below).

The upper-right Online Guarantee is a nice touch, but it links back to the main Huntington site which might be confusing for users (see screenshot below).

Direct Huntington online deposit application page 1

There is no mention of DirectHuntington at Huntington's main website <huntington.com>. However, there's a secret code (anywheresavings) you can enter into the Special Offers box that takes you to the direct banking site.

*Yet another direct bank

Note:

The Bank Deals writer had a relatively uninspiring call with DirectHuntington's customer service when he researched the account.

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