There’s a bit of irony regarding two headlines in my local newspaper: “Tech firms seek to lift secrecy on spy data” on the front page, and “Google buying startup Waze” stripped across the Business front. On the face of it, the stories, by the same San Jose Mercury News reporter, might appear unrelated. But a closer look reveals that both are related to collecting and analyzing data about Americans – and the privacy tradeoffs we make in the name of practicality, convenience, and security.

Both cases involve questions about who knows what, and how they will use the information. These are the same questions the financial services industry faces as it tries to persuade consumers to use personal finance management tools, products and apps that make life simpler.

In the case of the National Security Agency’s secret program known as PRISM, Google, Facebook, Yahoo, Microsoft, and Twitter are lobbying for more government disclosure. Google, which is fighting the inaccurate impression that it lets the government have “unfettered” direct access into its systems, is asking the government to disclose how many secret data requests it makes. Meanwhile, Google confirmed Tuesday that it is buying Waze, which makes a turn-by-turn navigation app that uses crowdsourced geolocation data so it can spot traffic jams in real time. In essence, Waze knows where its 50 million worldwide users are going, where they are, and how fast they are going. Depending upon how one looks at things, that’s either really useful or kind of creepy.

Banks and credit unions have an important advantage at the moment because of the perception and reality that they already are required to lock personal information into a virtual vault. But the popularity of Waze demonstrates what we see in Javelin data "21st-Century PFM for a Mass Audience: How to Build Everday Online and Mobile PFM": Mobile-hungry consumers are willing to look elsewhere for personal finance capabilities if they can’t get them from their financial institution.

Author

About Mark Schwanhausser

Mark Schwanhausser is JAVELIN’s Director of Omnichannel Financial Services. Mark strategizes how financial institutions (FIs) can track and serve customers across whatever channels they use, and provide a consistent, integrated brand and user experience. Mark helps banks and credit unions profitably enable customers to monitor and manage their money more intelligently through technology such as online banking, mobile banking, personal finance management, financial alerts, and technologies on the horizon like wearables.

Mark led the development of JAVELIN’s Financial Journey Model, which builds digital banking on a foundation of 10 time-tested personal finance principles, and JAVELIN’s holistic segmentation, which enables FIs to prioritize their investments to serve the critical needs of the profitable Moneyhawks™, high-value Traditionalists, and up-and-coming Emergents. His other work in 2015 has focused on how banks and billers can turn off paper statements by closing the “digital commitment gap,” why digital account opening has reached a tipping point, and how FIs can use alerts and notifications to initiate daily “conversations” with customers.

Before joining JAVELIN in April 2008, Mark worked for nearly 26 years at the San Jose Mercury News, mostly as a personal finance reporter writing about money and emerging trends in financial services and payments technology.

Mark has a bachelor’s degree in journalism from the University of Missouri at Columbia and attended Antioch College.

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