Blog - Page 1279 of 1287

Quicken-izing Your Finance Website

By Jim Bruene Posted on February 7, 2005
Categories: Intuit, Personal Financial Management

Looking for ideas to appeal to the Quicken segment? Personal Mvelopes, an online personal financial management system from In2m Corporation, stitches together account aggregation and bill payment into a $9.95 per month offering.

Analysis
The company has recently attracted some good PR (Kiplinger's, Boston Globe, BankRate.com) that may translate into some accounts. But unless In2m partners with stronger financial brands, the finance site will struggle to attract paying customers.

Consumers are wary, make that VERY WARY, of online financial services offerings, especially from unknown entities. But if a bank were to license the system and operate it under its own name, it might become moderately successful. (We say moderately, because budgeting is not a mainstream activity, and many of the budget-minded are already locked in to using Quicken or Money.)

If nothing else, the system demonstrates good customer advocacy. The bank could bundle additional services, such as…

Instant Online Bank Account Opening

By Jim Bruene Posted on February 3, 2005
Categories: Advertising & Promotion, Deposits, Checking, Savings, CDs, Sales Techniques

WSJ.com - Banks Speed Process For Opening Online Accounts

The Wall Street Journal reports today in its Personal Finance section on the plans at Citibank, Wells Fargo, Bank of America, Wachovia, and HSBC to offer instant online checking account signup later this year.

Analysis
While it makes sense for these national powerhouses to enable instant account signup, smaller financial institutions needn't feel they must follow suit.

Bank accounts, especially checking, aren't impulse purchases like the consumer goods sold at other online retailers. Most bank customers won't mind if their checking account is opened by the end of the week.

More important than instant signup are clear explanations of what happens next, email status reports as the process progresses, and clear privacy and security guarantees. A personal telephone call or email followup from a new account rep wouldn't hurt either.

-- JB

Mortgage OneAccount from the Royal Bank of Scotland

By Jim Bruene Posted on February 1, 2005
Categories: Mortgage, Refi & Home Equity, Royal Bank of Scotland

Speaking of combined accounts (see Higher One), why isn't anyone in the United States offering a combined mortgage/deposit account, a product that's been quite popular in the UK ever since Virgin pioneered the concept in 1997.

The OneAccount, now wholly owned by The Royal Bank of Scotland, has grown to 160,000 accounts with US$20 billion in loan commitments ($125,000 per account).

Analysis
While a combined mortgage/deposit account probably won't appeal initially to mainstream consumers, it's a potential PR and marketing gold mine. Using deposit totals to offset mortgage principal balance creates significant savings when compounded 30 years.

For example, a $1000 average "deposit" balance used instead to offset the mortgage balance, returns 5-to-1 in interest savings over the life of the loan (using 6% rate), e.g., a $5000 savings. The savings are more if interest rates increase.

Deposits used to offset the mortgage balance provide a…

The Future of Banking is Direct

By Jim Bruene Posted on January 31, 2005
Categories: Credit/Debit Cards, Direct Banking

In 1999, we published a report entitled Virtual Checking Accounts: On the Web it's the plastic that matters (OBR 50/51, July 27, 1999). Our hypothesis was that web-based access, electronic transfers, and a Visa or MasterCard were really the primary transaction tools going forward.

It has happened as fast as we thought it might. Two early proponents of this strategy, WingspanBank and Juniper, really never got off the ground, though Juniper did create an impressive credit card portfolio that was recently sold to Barclays.

Fast-forward to six years, HigherOne is working with 13 college campuses to offer its OneAccount, combing college ID, MasterCard debit, financial aid depository, electronic funding, and of course, website access.

Analysis
It's a trend worth watching. As today's teens and twenty-somethings move through their inevitable financial growth, they are going to think less about the bricks-and-mortar of THEIR BANK, and more about the website and…

ING Direct Fundraising ($320,000) for Tsunami

By Jim Bruene Posted on January 28, 2005
Categories: ING Direct, Website Usability & Design

ING Direct posted a Tsunami Relief Fund button on its main account view page (see above). So far, customers have kicked in $320,000. It's less than a buck an account, but it's still a sizable contribution in total. ING as a company has also pledged more than $1 million.

Lessons

The donation function is completely integrated, so it couldn't be easier. A link is provided to learn more about the organization that will administer the donations. Customers get feedback on results, in this case $320,000 raised, so that customers can take pride in the total amount raised.

Note also: The pitch in the middle of the screen (above) to sign up for electronic statements to be entered into prize drawings including a plasma TV. Refer to our Jan. 18 article for more on that sweeps.

-- JB

Identity Theft Statistics from Javelin Research

By Jim Bruene Posted on January 26, 2005
Categories: Identity Theft, Metrics & Market Research, Security & Privacy

Building on last year's FTC study, Javelin Strategy & Research and the Better Business Bureau, released the latest study of financial fraud and identity theft in the United States. A similar level of fraud was found in the late-2004 polling compared to the FTC survey fielded in mid-2003.

Both studies found that just under 5% of U.S. adults, around 10 million, had been victimized in the prior 12 months, with total losses, primarily to financial institutions, of about $50 billion.

One of the major conclusions is that consumers are more likely to be victimized through offline methods compared to online methods, leading Javelin to conclude in their press release:

Internet-related fraud problems are actually less severe, less costly and not as widespread as previously thought.

However, this conclusion that is disputed in Bob Sullivan's MSNBC article by both Gartner's Avivah Litan and FTC attorney, Lois Greisman.

Here are…

PayPal offers “eCommerce Safety Guide”

By Jim Bruene Posted on January 25, 2005
Categories: PayPal, Security & Privacy

PayPal's state-of-the-art Security Center has a new educational piece, the 20-page eCommerce Safety Guide (download 1MB file).

The handbook covers three areas:
- safe online shopping
- preventing identity theft
- phishing and spoofing

Naturally, it concludes with a section promoting PayPal and eBay as safe methods of buying online.

The booklet, authored by Robert Chesnut, eBay VP of Trust and Safety, uses Gartner and Javelin Strategy for its identity theft data.

Analysis
Financial institutions looking to increase their educational efforts should consider posting a similar booklet, explaining the protection afforded by bank products. Total readership may not be high, but it demonstrates a commitment to the customer in an area of high anxiety these days. It would be an excellent summer intern project.

To learn more about how to promote online security and peace of mind to your customers, check out Marketing Security: The sensitive issue of…

Pay Your Better Business Bureau Dues!

By Jim Bruene Posted on January 21, 2005
Categories: Capital One Financial Corp., Website Usability & Design

We like the idea of posting selected third-party endorsements on your website, for example, FDIC, Better Business Bureau, VeriSign and so forth. However, make sure you don't let your membership expire, otherwise you get a very bad result.

In reviewing the eSmartLoan website, purchased last month by Capital One (see Jan 20 post), we clicked on the Better Business Bureau logo on its home page and were greeted by a pop-up explaining that the company was no longer a member, either because they failed to pay their dues or failed to comply with BBB policies.

Ouch!

-- JB

Online Home Equity Lending to Heat Up

By Jim Bruene Posted on January 20, 2005
Categories: Mortgage, Refi & Home Equity

Capital One Financial's purchase of online home-equity lender eSmartLoan for $155 million on December 14 (press release), should increase the level of innovation in this market in the coming years.

eSmartLoan originated about 12,000 home equity loans in 2004, totaling more than $1 billion, just two-tenths of 1% of the national total of $431 billion according to SMR Research Corp. The 2004 total was up more than $100 billion (35%) from the $320 billion in home-equity loans were originated.

Under its previous owner, National Bank of Kansas City, the online lender was willing to lend up to 125% of the home equity (LTV).

If you'd like to learn more about the how to optimize online lending, check out the latest report on the subject from our sister publication, the Online Banking Report.

New and Improved Login at Nationwide Building Society

By Jim Bruene Posted on January 19, 2005
Categories: Security & Privacy

UK's Nationwide Building Society has implemented a system that should defeat most phishing and keylogging attacks. After entering their customer number (which can be saved on the computer), users must complete two more fields:

Any one of three previously registered "memorable" data Using drop-down boxes, select three randomly selected digits from their six-digit passcode

Users probably don't much like the changes at first, but it won't take long before it's routine, especially since users can select their own six-digit passcode.

Analysis
This system eliminates three problems:
- Those who use the same username/password from other sites
- Users with very easy-to-guess passwords such as their spouse's name
- Keyloggers who capture typed username/passwords

To learn more about how to promote online security and peace of mind, check out Marketing Security: The sensitive issue of publicizing security and authorization enhancements from our sister publication, the Online Banking Report.

Making Online Banking Fun

By Jim Bruene Posted on January 18, 2005
Categories: Advertising & Promotion, ING Direct, Rewards Programs

Is banking ever fun? Not really. The best you can hope for is that it's "pleasant."

How about online banking? It might have been classified as fun the first couple times you tried it, but it's not fun anymore unless you happen to have lots of money piling up in your account.

Is it possible to keep it fun? Yes, but you'll have to continuously innovate. As Seth Godin points out in Free Prize Inside: The Next BIG Marketing Idea, "The price of WOW keeps rising." In other words, what impressed your customers today, no longer impresses them tomorrow.

One innovation that we'd like to see more widely used is rewards programs for online delivery. It doesn't have to be as expensive as frequent flier programs, more like the free Cokes you can win from time-to-time under the bottle cap.

Examples
1. ING Direct has a monthly raffle…

Baseline Online Broadband Usage Statistics

By Jim Bruene Posted on January 17, 2005
Categories: Metrics & Market Research

Here are the Yankee Group's baseline PC and online usage forecast, as cited by The Seattle Times today:

2003: 112 mil US HHs >>> 74 mil online >>> 30% broadband
2004: 113 mil US HHs >>> 78 mil online >>> 38% broadband
2005: 114 mil US HHs >>> 80 mil online >>> 45% broadband
2006: 115 mil US HHs >>> 81 mil online >>> 52% broadband
2007: 116 mil US HHs >>> 83 mil online >>> 58% broadband
2008: 117 mil US HHs >>> 84 mil online >>> 63% broadband

How to read: In 2003, 74 million of the total 112 million U.S. households went online through their home computers; 30% (22 million) of those going online use a broadband connection, the remainder (52 million) use a dial-up connection.

See Online Banking Report (#114) for the corresponding online banking forecast.

--JB