Listen to any bank analyst call and executives will be talking about technology and/or how they’re competing with silicon valley. Even if you don’t listen, but simply pay attention to what’s happening you’d realize that banks are just software companies with banking licenses.
Most of us have heard of Square. The mobile phone & tablet accessory that lets anyone accept credit cards. Of course, if you listen to how they talk about themselves, they’re a payment platform. (Sounds like a bank would want to be a payments platform, right?)
Well, they’ve just hired an exec away from Amazon to run engineering. This is an interesting hire through an ‘order of battle’ lens.
If Square becomes the Amazon Web Services of payments, what then are the banks to become?
What I don’t understand is… where are the banks innovating?
Listen to their mobile commercials & they’re promoting mobile check deposit. Doesn’t every bank offer mobile check deposit at this point? (Yes.)
Do you think that banks have written their mobile check deposit software? No. They’ve gone out and purchased the capability and with some basic integration incorporated it into their apps. It’s not differentiating. It’s not something that binds customers to the ecosystem.
Not one of the apps on multiple “best mobile finance apps” lists is a bank’s app.
I realize that they’re trying to educate a less technical public than my personal demographic… however, I don’t see anything innovative like Square (payments) or Betterment (wealth/investing) or Mobile (banking / budgeting). That last link is a link to ‘best mobile apps‘. It’s actually a weak article – there are others that I like a lot not on that list. Regardless, in that article or on my list… not one of the apps is a bank’s app. Seems strange, right?
Here’s the thing. If a bank doesn’t have the staff, or innovation, or expertise to write creative mobile financial apps… why not do what the NY MTA did when it came to apps for the subway. There are 78 iPhone apps & 42 android apps, none of which they wrote themselves but are truthfully able to take credit for enabling. They delegated the complexity, and then boasted about it.
This lack of innovation, of course, aligns with the real-world research that shows that people trust their banks with their money, but don’t believe innovation will come from the banks.