CommBank Introduces Kaching For Facebook and 'Signals' Insight Platform

Commonwealth Bank of Australia continues to be one of the bank innovation leaders, announcing two social-based platforms this week. 'Kaching for Facebook' is an extension of the already popular Kaching smartphone app covered in a previous Bank Marketing Strategy post, allowing customers to do basic transactions within the Facebook website. 

In addition, CommBank introduced the 'Signals' insight hub that collects transactional data to allow customers to view and share how their transaction patterns compare with others.

Kaching Comes to Facebook

CommBank Kaching for Facebook is a new app that will give Australia's 12 million Facebook users access to everyday banking and payments on their favorite social network. Based on the popular Kaching mobile payments app, the new app lets users pay back money owed or make cash gifts to friends of family for birthdays or weddings. The app also allows a customer to view transaction history within the Facebook website.

"With Facebook popularity skyrocketing to more than 55 percent of the population in Australia, we know our customers, particularly Facebook's core user base of 18-35 year olds, are looking for new ways to connect their banking and their lives, friends and causes within Facebook," states Commonwealth Bank's chief marketing and online officer, Andy Lark. "So what better way to respond than by giving them access to everyday banking and payments on their favorite social network?"

Accessed directly from the Commonwealth Bank Kaching Facebook page, the app is a scaled down version of a typical online banking app optimized for mobile using responsive design.

When customers sign up for the new Kaching app on the CommBank Facebook page, they will be able to view account balances and transaction history, transfer funds between accounts and view peer-to-peer payment and request history. In addition, the features of the new service will allow people to:

• Pay Facebook friends or anyone using an email address or Australian mobile number and Australian bank account;
• Request payments from friends;
• Gift payments to friends and family;
• Make payments directly to Facebook event pages.

While the initiative allows customers to transact on a commonly used platform, online banking manager at CommBank, Drew Unsworth, admits that people may not feel comfortable doing regular banking on Facebook. "When people first hear about it, they think all of their financial details will be on their Facebook wall, but that's not right," Unsworth says. 

To address the common concern of security and privacy, Commonwealth Bank will secure transactions using a combination of a 4-digit PIN code to log into the Facebook app in conjunction with a six-digit confirmation pin sent via SMS. The code is also used by the payee to receive the payment. 

Commonwealth Bank also has built Kaching for Facebook to help alleviate consumer concerns regarding privacy in the Facebook environment. "We designed CommBank Kaching for Facebook in a way that ensures Facebook does not have access to, or visibility over, anything our customers do within the application," Lark said. "Our customers have total control over which personal and transactional information they choose to send to friends, post on their walls or post on another person's wall."

In addition, the bank is offering a '100% security guarantee' that will cover customers for any losses that could occur due to unauthorized transactions.

Below is the video that describes the new Kaching for Facebook.

Facebook is the third platform to host the Kaching app, following the initial iPhone app introduced in 2011 and the Android version of the payments application released last year. Commonwealth Bank also expanded the functionality of the mobile and Facebook app, making it possible for customers from other banks to collect payments using Kaching.

To date, more than 6.5 million CommBank customers use online banking and more than 2.5 million customers accessed their accounts via mobile platforms.

Signals Leverages CommBank Data For Insights Platform

As opposed to keeping all of Commonwealth Bank's 'big data' private, the largest bank in Australia has decided to pool their extensive spending and savings data to launch a new consumer insight platform, Signals. Processing over 40% of the nation's transactions daily, CommBank will leverage the Signal content-rich data hub to publish megatrends monthly, supplemented by videos and infographics that will help consumers visualize the data. The first Signal infographic focuses on the costs of childcare.

Premier Signals Infographic on Childcare Costs

In addition to publishing megatrends monthly, Signals will also allow an individual to view how they compare to others in their demographic segment. Using a highly engaging and interactive personalized video tool, a person can compare how they spend, save, transact and borrow based on their gender, age and postal code within Australia. If desired, a consumer can share and compare their information across various social networks.

Below are some of the screenshots from the process (the output is actually a personalized video with voiceover). Each slide in the presentation provides a link to the appropriate area of the bank for assistance in saving, investing, borrowing, etc. A personalized infographic is also generated from the input and is available to share via social networks.

Personalized Insights Based On Age, Gender and Postal Code

Personalized Infographic Created By Signals Insight Platform

"CommBank has always had a deep passion about improving the financial knowledge of all Australians. The reality is, the more information you have, the more inclined you will be to make better informed financial decisions. Signals is a visual and interactive site providing customers with spending patterns across a broad range of topics," stated Commonwealth Bank's Lark.

Signals is similar to another compiled data sharing hub - PeopleLikeU - introduced last November by Australian bank competitor UBank (backed by NAB). While this site asks for more information than the Signals platform (gender, age, housing, income, family structure and location) which may inhibit consumer participation, CommBank will note that the database for comparison is smaller.

 

Related Posts

Kaching Users In New Era Of Mobile Banking - Bank Marketing Strategy ((October 2011)

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Digital Marketing Capabilities Lacking At Many Banks

With continued rapid growth of both online and mobile banking, banks and credit unions need to come up with better ways of marketing through digital channels. 

The technology is readily available, and best practices can be found at companies like Google, Amazon and others, but many banks are still at the infancy stage in terms of digital marketing capabilities.

To succeed in the future, financial institutions need to have a single view of the customer across channels, be equipped with advanced analytics for predicting behavior, be able to deliver offers to customers in real time and effectively integrate social media into the marketing mix.

A just released study by Efma and Wipro Technologies entitled, 'Global Retail Banking Digital Marketing Report', found that only a few banks are prepared for the digital marketing revolution, with the potential for improvement significant at most organizations. This first ever study also revealed that social media is not yet a part of mainstream marketing and is not a key customer interaction channel for most banks.

According to Rajan Kohli, vice president and head of banking and financial services at Wipro, "Digital technologies, social media and the explosion of data are redefining customer engagement models. The CMOs that we spoke with made it clear that the role of the CMO is changing as banks adapt to the development of new channels and capabilities."

For most banks surveyed, digital delivery channels were seen as complimentary to branches, being more important for processing transactions than for customer service and advice. With this transition across channels, it is believed interactions will be more frequent, insight collection will be more prolific and communication opportunities will be more direct.

As part of the Efma/Wipro study, a Digital Marketing Capability Index was created to benchmark capabilities vis-a-vis the best in class. Only 13 percent of banks surveyed demonstrated the highest level of maturity in digital marketing. The survey measured eight different capabilities including:

• Ability to get real time single customer view across channels
• Segmentation using customer lifetime value
• Ability to microsegment
• Availability of predictive analysis
• Real time, event driven marketing
• Personalization of offers on a 1:1 basis
• Implementation of test and learn approach
• Measurement of return on marketing investment (ROMI)

While banks in developed countries scored higher in most categories, key takeaways of the research illustrated the following potential for improvement:

• One of the weakest areas for banks is the ability to get a real time, single customer view of products held and transactions occurring across all channels.
• There was a surprising lack of test and learn processes and measurement of return on marketing investment in digital channels.
• While most banks are proficient at the use of advanced analytics (such as predictive analysis), most don't have the capability to integrate this insight in real time for marketing on a multichannel basis.
• While involvement in social media is standard practice at many banks, these channels are only used for outbound marketing and monitoring complaints. Using social media for transactions and digital interactions is lagging.
• Effectiveness of 'big data' projects (in the few places where implemented) has been modest, yet several of those surveyed believe big data will play a significant role in the future.

Interestingly, many smaller banks scored relatively well on digital marketing capabilities, possibly signaling an advantage of relatively new, non-legacy IT systems. The two direct only (online) banks in the survey both scored high in digital marketing capabilities.

Marketing Spend

The marketing mix at banks continues to change in response to the growth in digital channel usage. While the research indicated that traditional advertising comprises around 50% of a bank's marketing budget, this spend was less than 50% for banks in developed countries and as low as 20-25% of the budget at some of the more progressive banks surveyed.

When asked to project what the marketing mix will be in 5 years, traditional advertising and sponsorships continued to slide, with non-traditional (digital) and direct marketing increasing due to the potential for better targeting and measurement.

The Digital Marketing Capability Index

Using data collected from the survey, it was clear that big differences existed between the leaders and laggards in digital marketing. While significant work would be needed for many banks to reach 'best in class' status, the index provides a valuable index to measure opportunities for improvement.

Review of the actual study will provide additional insight into the measurement process and weightings, but a standard 'bell curve' was the 'digital maturity' output of measuring over 100 banks from 38 different counties from November 2012 and April 2013. Sixty-two percent of the responding banks were smaller banks, while 38% were medium/large institutions. Fifty-eight percent were from 'developing' countries with 42% being from higher income, developed countries.

As can be seen below, on average, banks feel most proficient at developing predictive analysis and segmentation. Deeper discussions with the banks in the study, however, indicated that very few banks are able to do analysis in real time or link the analysis back to individual customer offers on a channel level.

In addition, most banks fell short on the ability to leverage real-time, event driven marketing or 1:1 personalization which is becoming expected by customers in the digital age.

Real Time Single Customer View

Not surprisingly, most banks have a real time, or at the least a periodic, view of retail customer product holding, product use and transactions. What is less likely is for a bank to have a view of all accounts within a household or across business and personal accounts. All of these capabilities were projected to improve significantly over the next five years according to the study.

Segmentation

Segmentation for better targeting and customer experience is not new at banks or credit unions. In fact, 90% of the banks covered in the Efma/Wipro research are increasing their segmentation efforts to take into more detailed demographic categorization and even channel use. This is important since traditional demographic segmentation (age & income) has recently been found to have limited use. (see Bank Marketing Strategy coverage on the weakness of demographic segmentation here)

The missing element in many cases is lifetime value segmentation for use in dynamic, real-time marketing. In addition, online data such as web clicks and social media is still used rarely for segmentation purposes by banks while used extensively by other industries like retailing and travel.

Business Intelligence

One of the more significant challenges for financial marketers today is the collection and analysis of unstructured data from within and outside the bank. As mentioned earlier, while predictive analysis was still found to be done in the majority of institutions, the use of this analysis to drive real-time decisioning was still rather rare. The same could be said for micro segmentation as shown below.

Real Time and 1:1 Personalization

The surprising lack of use of lifestage behavioral triggers and and 1:1 personalization of offers by financial institutions have both been covered recently by the Bank Marketing Strategy blog. The findings of the Efma and Wipro digital marketing capabilities study found the same deficit. 

According to the study (and realizing that the numbers are marginally better in developing countries), only 36% of the banks can do any real time event marketing, and only 47% make 1:1 personalized offers. 

Obviously, with more banking and credit union customers using online and mobile channels for the majority of their everyday banking, the inability to be agile with offers puts many banks at a disadvantage. 

Test and Learn

The concept of 'test and learn' has been used in banking since the early 1980s, with large credit card companies being the earliest and most well known proponents of this strategy. More recently, other large banks, such as PNC, Chase, U.S Bank, Bank of America and others have integrated this technique as a standard operating procedure within their direct marketing and knowledge management teams.

Surprisingly, the global banking study found that 70% of banks reviewed use test and learn in less than 25% of their digital marketing campaigns, with only 10% of the banks using test and learn in more than 75% of their campaigns. Possibly more disturbing for seasoned financial direct marketing professionals would be the finding that while test and learn was used for individual programs, the findings were not retained and retested as part of an ongoing process.

Return on Marketing Investment

Despite the importance of measuring the results of marketing campaigns to justify future investment and determine which programs should be continued or curtailed, only 25% of the banks surveyed measured ROMI in more than 75% of their digital marketing campaigns. It was also found that the confidence in the measurements done was not high, potentially the result of different attribution strategies.

Interestingly, several of the banks surveyed also believed that almost all digital marketing campaigns were effective and that it was not necessary to measure the impact of any one campaign result. This is obviously a faulty assumption.

Social Media in Banking

It comes as no surprise to any financial marketer that the growth of social media has realized a parallel trend to digital marketing. Facebook, Twitter, YouTube, Pinterest, LinedIn and other popular social media sites have become the focus of discussion and debate within the financial industry as to the effective use and potential value of these channels. Adding to the confusion is the fact that most social media site users skew towards the younger demographic segments (that traditionally have a lower immediate value to banks and credit unions).

Because of this doubt, and despite a great deal of 'noise' that seems to point to the contrary, the spending on social media efforts by banks is still relatively small, with less than 500,000 Euros ($637K) being spent by 80% of the banks, with a very small number of banks spending over 1M Euros ($1.3M).

1M Euro = Approx. $1.3M

Not surprisingly, Facebook continues to be the primary channel invested in by banks, followed by Twitter and YouTube. Interestingly, while user generated content was currently used least, this is an area of social media where more future investment seems to be heading.

Currently, social media is used more as a branding and broadcast communication tool and as a way to monitor customer comments and complaints. Despite some well documented successes in developing countries as well as in Australia and other countries overseas, most banks are not looking to social media as a transaction tool at this time. This may change as perceived security of these channels improves, but demand for integrated social banking does not appear to be strong in many countries.

Social Media 'Plateau' in Banking

Given the doubts surrounding the value of using social media extensively for bank marketing, the researchers involved in the Efma study believe the use of social media by banks has reached a 'plateau'. "While some banks are of course just catching up, the leading banks are still working out how to best use social channels in the future, conducting experiments, and looking for indicators from other industries," states Efma.

Other social media observations include:

• Social media is proving useful as a customer engagement tool.
• Most banks do not see social media as a strong ‘channel’ for product sales in the near future.
• Banks are considering using social media to ‘promote’ their services through advice and support, such as forums around house purchase
• Some banks are looking at how to make use social media for advocacy – using promoters to get positive messages out relating to new products or service
• Measurement of the effectiveness of spend on social media has been relatively basic, looking at high level metrics such as the number of “likes”on Facebook. (many banks are beginning to view these metrics as misleading)
• It is unlikely that most banks will try to offer transactional services through Facebook or Twitter in the near future, although some will make it possible to do small person-to-person payments to Facebook friends.

Note: A very detailed look at current social media initiatives globally is provided within the EFMA/Wipro research report available here.

Big Data in Banking

Despite a lot of noise and trade press that may give financial institutions the thought that they are 'falling behind' in the capture and use of 'big data' (no definition attempted here), the Efma/Wipro survey shows that only a few retail banks have begun to work on big data projects. Of those that have initiated big data projects, the effectiveness for increasing revenues or reducing costs is relatively modest so far.

In my travels across the country and in speaking to many marketers at some of the largest banks, it appears that most banks are using new technology to gather and analyze new 'small data' sources such as transactional data and money in / money out movements. While these would usually be considered 'structured' data uses, most banks want to maximize value of these data sources before tackling 'unstructured' data.

In other words, with digital marketing, social media marketing and big data, taking small steps may make sense before trying to 'boil an ocean'. The key is to not move too slowly . . . since the marketplace is moving at breakneck speed.

Additional Resources

'Global Retail Banking Digital Marketing Report' - Efma and Wipro (May 2013)

Banks Accelerate Mobile Banking Innovation

The acceptance of mobile banking has grown more quickly than most financial institution futurists could have imagined. The impact of channel migration is changing the foundation of banking as we know it, with banks now being carried in customer's pockets and handbags wherever they go.

This seismic shift in consumer behavior is prompting banks around the world to innovate their mobile offerings at breakneck speed. The question is . . . what will the next generation of mobile banking look like? And how should banks respond?

In the new insight report entitled, "Mobile Banking 2013 - Are You Following or Leading?", Mapa Research provides an in-depth quantitative and qualitative review of the mobile banking offerings of 67 banks in 14 countries to find the best of recent innovations in the industry. Using a panel of live bank accounts from around the world, the report has close to 100 visual examples of mobile innovations including reviews of 15 additional offerings that put the best and most recent mobile banking developments under the microscope.

The report debunks a number of myths that seem to be prevalent both inside and outside of the financial services industry:

• The largest banks have been hampered by legal constraints and legacy systems meaning ‘risky’ or innovative ideas have been shelved. Innovations are coming from large traditional banks as well as nimble mobile centric disruptors
• Few banks let customers make payments to new payees in mobile banking. In fact more do than don’t
• Payments to mobile/email services have been pioneered only by the most innovative banks. Again, the banks who don’t provide this functionality are now in the minority
• Meaningful customer support and advanced functionality such as PFM and share trading are hard to deliver on mobile. In fact more and more banks are proving that these features can be deployed successfully

Preview of Mapa Research report available for free download here. 

Devices and Platforms

As has been documented by various sources in the past several months, mobile banking has been adopted at a much faster rate than any other banking technology. In fact, at some institutions, the number of online banking sessions conducted from a mobile device currently exceeds the number through non-mobile channels (while the mix of transactions performed at a computer, tablet and smartphone differ).

With smartphone penetration reaching the tipping point, it is not surprising that all 67 banks analyzed by Mapa provide native apps for both the iOS and Android platforms. In addition, 3 in 5 banks also have either a Blackberry (43%) or Windows (39%) phone app, with only 25 percent having both. 

As has been the case since the beginning of the mobile banking revolution, most institutions also have a mobile optimized web product (75%), with banks staging the introduction of innovations across different platforms at a different pace based on the platform penetration within their customer base. Interestingly, only 4% of the banks reviewed have built a fully responsive website.

Current Mobile Banking Functionality

While the 'table stakes' for mobile banking offerings continues to change, Mapa analyzed how banks are currently providing core mobile banking functionality to customers. The primary areas reviewed included:

• Registration and login
• Understanding basic financial status
• Transacting
• Communicating with the bank

Registration and Login

With security and privacy being at the forefront of concerns for mobile banking customers, balancing the need for robust authentication with ease of registration and simple ongoing use requires striking a delicate balance for banks. As can be expected, there is greater scrutiny during the initial registration process than is required after the registration is complete. That said, U.S. financial institutions seem to be taking a more conservative approach than their counterparts overseas, with most requiring an ongoing two-factor authentication with more information required at login.

The two most common approaches found in the research are the use of cookies to remember online banking usernames and the use of SMS verification in conjunction with account/card numbers for first time registration.

Understanding Basic Financial Status

While all banks reviewed allowed customers to view balances and see recent transactions, the ease of access to this information and depth of insight differ rather significantly. Eleven of the banks reviewed (none in the U.S.) allow customers to view their balance before login. 

While there are examples of organizations that provide this functionality in the U.S. (GoBank's 'balance slidebar' being the most notable), the balance between privacy and simplicity keeps many banks on the sidelines. Interestingly, the availability of pre-login balance was voted as the most favorite feature of CommBank's Kaching offering.

The Mapa research provides many specific visual examples of how banks around the globe are still grasping for the 'sweet spot' of PFM on mobile and how to visualize the customer's financial position. Some banks reviewed provide a snapshot of a customer's complete financial position using easy to understand graphics, while others provide just a transaction overview.

PNC's Virtual Wallet provides graphic view of current and future financial position

Transacting

The movement to a pure mobile wallet environment has been much slower than projected (for reasons that are better covered in another blog post), but the options for P2P payments and transfers are increasing at a pace consistent with each bank's risk tolerance and internal compliance perspective. As a result, almost all banks allow for external payments and internal account transfers, while fewer provide a means to pay via mobile phone number or email address or to make external payments to a new payee. 

Only the most progressive banks reviewed allow payment via QR code or 'bump' with 3 percent providing a social media mobile payment option as shown below (Commonwealth Bank in Australia and Commonwealth owned ASB in New Zealand). Additional banks allow for 'Facebook Banking' on the desktop according to the Mapa study.

Note: Mapa provides a very thorough review of different approaches banks have taken to allow for payments to new payees and how banks handle their pay-to-mobile service in the Mobile Banking 2013 - Are You Following or Leading report.

Communicating With The Bank

One of the most important, and least developed, areas of mobile banking innovation is in the ability communicate with the bank through the mobile banking application. Several examples of communication innovations are provided in the study. Some require a user to leave the mobile banking application to reach the bank, while others went as far as providing personal phone numbers, email addresses and even work schedules of primary contacts.

Mobile Banking Innovation

It is clear from the more than 100 Mapa visual examples in the research that exciting innovations are occurring at every mobile banking customer touchpoint and at every large bank in the world. From initial registration and transacting to channel integration and social media engagement, banks are leap frogging each other with new ideas that will simplify mobile banking while providing additional functionality.

When asked whether the gap between mobile banking innovation 'leaders' and 'followers' has widened or shrunk, Mapa consultant and one of the authors of the report, Joshua Grant stated, "The gap between the leaders and followers has been closed simply because many of the followers did not previously have a concrete mobile banking proposition." He added, "Going forward, some banks will be content simply to provide hygiene factors to their customers. But from working with many digital mobile teams around the world, these banks will be in the minority."

Core Functionality

Simplicity and engagement are the key objectives with innovations connected to most core banking functionalities. With the registration and login process as well as understanding finances, banks are pushing the envelope around the insight a customer can easily access. One of the banks reviewed by Mapa provides six recent transactions before login, while another actually enables the customer to display their balance as a widget on their mobile homepage upon authorization.

In addition, the ability to get real time categorization of purchases, understand future financial obligations and, in some cases, integrate photo capture of receipts within the mobile banking application sets banks like Moven, Simple, Chase, GoBank and American Express apart from many other competitors. The visual examples in the study make it clear that there is definitely not just one way to accomplish these tasks however.

While not reviewed in depth within this Mapa Research report, it was noted that the PFM functionality of virtually all of the banks analyzed differed significantly between the smartphone application and the desktop and tablet applications. Not only are many of the leading banks streamlining PFM for mobile, but also using many of the unique interactive capabilities of the tablet in displaying a customer's finances.

Payments

Innovation in the payments space is not limited to traditional banking organizations. Examples are provided as to how PayPal, Google, Square and others continue to set the bar with regard to simplicity and mobile integration of the payments function. While QR code payments appear to be a phenomenon mostly outside the U.S., the use of the smartphone camera for depositing checks and (more recently) paying bills is gaining momentum.

Mapa illustrates the steps for a PayPal mobile merchant payment 

Communicating With The Bank

Since the mobile channel was expected to offload many of the basic interactions the customer was previously having with the bank (balance inquiries, bill payments, depositing checks, etc.), building dialogue options into mobile apps has lagged some other innovation categories. That said, Mapa does provide examples of how banks allow for feedback generation within the mobile app (ICA Banken), customized push notifications as opposed to SMS or email messaging (Skandia Bank, Bank of America), and even how a couple banks are providing offers via mobile push notifications (Standard Chartered).

The best example of communication innovation within the mobile platform (my opinion) can be found where banks are integrating live chat functionality into their mobile apps to provide instant access to customer support. Both BMP Paribas and NatWest provide this capability, with NatWest allowing for specific account queries.

Channel Integration

Unfortunately, most mobile banking applications traditionally have been the outgrowth (miniaturization) of a bank's online banking application, thereby creating channel silos as opposed to a fully integrated functionality. This is changing, however, as more of the larger banks building new mobile applications from the ground up, integrating branch, online, ATM and other channels seamlessly.

Examples of using a mobile device to get cash without a card at an ATM (NatWest, Bankinter, IsBank), authenticate transactions made online, and booking appointments at a branch (ING Belgium), all help move banking to a more omnichannel environment.

Customization and Social Media Integration

It is clear that leading banks are just beginning to allow customers to customize their mobile banking experiences through personalization (adding photos). Eventually, it is believed that the ability to customize a mobile banking app will increase as improvements in some of the basics of mobile banking are completed. The objective of introducing personalization is to increase engagement, use and loyalty to the bank's brand.

Investment in mobile social media strategies has also lagged more basic functionality as banks continue to try to validate the ROI of this endeavor. There are some standouts in the banking industry, however, who have built their mobile banking platform with social media integration in mind as shown in the Mapa research.

Joshua Grant from Mapa notes, "A key trend is the social aspect of mobile banking. Banks are now including themselves in their customers’ personal dialogues by allowing them to, for example, request payments from friends, send photos and messages along with payments, share financial goals and access community support. Personalization and communication with the bank are also very active areas."

As mentioned, social media integration within the U.S. continues to lag, with some notable exceptions by USAA and Moven.

Voice Navigation

One of the more exciting areas of innovation is the ability to conduct basic transactions with voice commands. According to Bank Innovation, US Bank will soon begin offering voice control technology to users of its FlexPerks mobile app. The technology is being provided by Nuance, a provider of digital speech and imaging tools. The bank will be using Nina, the Siri-like virtual assistant that USAA has been using for its 2.5 million mobile customers.

The benefit of this innovation is that customers can navigate around the mobile banking application using voice commends in a hands-free mode. Mapa notes that BBVA is also experimenting with voice technology.

Monetizing Mobile

At a time when cost reduction and revenue enhancement are at the top of every banker's list of goals, the ability to potentially extend the benefits of mobile banking to include online and offline commerce is enticing. While early mobile applications have been of the standalone variety that can be accessed by both customers and non-customers, some banks are attempting to integrate rewards platforms and internal product offers within the mobile platform.

Bank of America may be the first to to provide notification and redemption of merchant-funded reward offers within the mobile banking application. Other banks are testing gamification around online and mobile activity or associated with Foursquare check-ins. Integrated rewards are also prevalent in non-banking mobile applications by Square, Shopkick and Starbucks.

The Future of Mobile Banking

It is clear that the marketplace will be continually evolving with new competition from traditional banks and non-banks. To stay relevant, banks will need to stay in touch with consumer mobile expectations and the needs of the bank. New players will likely emerge including aggregators like Mint and mobile wallet providers like Google and PayPal.

According to Mapa's research chairman Mark Pavan, successful banks will need to be reactive, responsive and forward-looking. Strategies of successful providers will include:

• Exploring many different opportunities simultaneously. The market is moving too quickly to take on a single mobile innovation initiative at a time.
• Collaborating with external providers to fast track launches (this was evident with Commonwealth Bank's Kaching)
• Segmenting features against needs with simplicity being the focus of new innovations.
• Thinking buy rather than just pay like has been done by American Express and a number of other American banks.

Looking forward, banks will not only have to do more of what has been discussed above, but they may need to engage more expert contractors to keep the innovation process active. Some banks are opening up their APIs to third parties to create add-on services. Differentiation through mobile is possible even though the cycles may be short. 

Other areas of innovation include mobile banking beyond smartphones such as wearable technology (Pebble) and innovations like Google Glass as well as new security solutions that include voice biometrics, fingerprint scanning and iris recognition.

Finally, while it may be easy to look at other bank's innovations, there is really no one-size-fits-all approach according to Mapa's Joshua Grant. "The most important thing is that senior management buys into mobile – some of the most innovative digital teams are hampered by constraints from above."

A download of the Mapa Research preview deck (including an excellent diagram of the current and future generations of mobile banking) is available for free download here with information on how to purchase the complete 70 page research report. 

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