Bank Wars Underscore the Relationship between Data Breaches and Fraud

I was quoted using unusually provocative language (for the conservative banking industry) in the New York Times on Saturday , in which I referred to First American Bank’s public calling out of Bank of America as “hot bank on bank action”.  Reporter Ron Lieber used the words “punk rock fashion” to precede my quote, as he went on to describe the jarring public dispute on Read the rest of this entry »

Technology increasingly giving banks different customers?

We all expect that residents of one locale–from Utah to Illinois or Alabama–will be different, on average from that of another. So why do customers of one bank–such as #BankofAmerica, #CitiBank, PNC, or Wells Fargo–also have equally strong degrees of uniqueness? Technology increasingly has a lot to do with why one banks’ customers differ from another, and we need to ensure we remain focused on the customers of the future rather than just catering to current demands.

PNC has embraced fascinating new technologies, from mobile to online and PFM, and as a result they have more (Gen Y.1 18024 YO) young adults than any other large bank today. In fact, I was once conducting industry research at an Occupy movement site Read the rest of this entry »

Competitive customer-experience research is vital when making changes to the customer’s channel experience

Competitive customer-experience research is vital when making changes to the customer’s channel experience, because results can bring either a financial windfall or disaster. Financial institutions and their vendors must survey their customers, using survey-based research in order to understand how the release of new mobile or online features is changing customer usage patterns across not only all other channels, but with their customers activities at competitors as well.
Actual example: a couple of years ago we used a Javelin n=5,000 survey to assess how consumers of each of the nation’s top banks interact with their primary financial institution (PFI). Specifically, with many new electronic alerts offerings rolling out at that time we wanted to understand how consumers reacted across all channels of their PFI, and how this compared across all top US banks. Banks’ own data certainly would not yield such findings. We learned that BofA and Citibank customers responded to electronic alerts in positive ways, such as logging into accounts electronically. Meanwhile, customers of RBS Citizens were responding in disastrous ways, such as reducing the use of cards, calling customer service or going into branches!
You can only improve on what you’re aware of, and multi/omnichannel and competitive research can be a cost effective way to drive positive change.

Competitive customer-experience research is vital when making changes to the customer’s channel experience, because results can bring either a financial windfall or disaster. Financial institutions and their vendors must survey customers, using survey-based research in order to understand how the release of new mobile or online features is changing customer usage patterns across not only all other channels, but with their customers activities at competitors as well.

Actual example: a couple of years ago we used a Javelin n=5,000 survey to assess how consumers of each of the nation’s top banks interact with their primary financial institution (PFI). Specifically, with many new electronic alerts offerings rolling out at that time we wanted to understand how consumers reacted across all channels of their PFI, and how this compared across all top US banks. Banks’ own data certainly would not yield such findings. We learned that BofA and Citibank customers responded to electronic alerts in positive ways, such as logging into accounts electronically. Meanwhile, customers of RBS Citizens were responding in disastrous ways, such as reducing the use of cards, calling customer service or going into branches!

You can only improve on what you’re aware of, and multi/omnichannel and competitive research can be a cost effective way to drive positive change.

BTW, I rarely blog these days as I’ve found Twitter to be more my speed. Follow me on Twitter as #jimvandyke

Bank Transfer Day: More People Transferred, but to Another Bank!

There were two major surprises in our Bank Transfer Day research, which was created from both large-scale national polling and walking around actual Occupy sites to interview people.
The primary finding was that, despite stated intentions, not many people actually transferred their money to a credit union from a large bank.
The second finding, perhaps hidden in the shadow of the primary one, is that more people did transfer their money out of a large bank!
So if people transferred their money out of a large bank in the wake of Bank Transfer Day but they didn’t move it to a credit union, where did the money end up? Surprise: the money ended up being transferred to another large bank!
This is the surprise research finding that no one is talking about.

There were two major surprises in our Bank Transfer Day research, which was created from both large-scale national polling and walking around actual Occupy sites to interview people.

The primary finding was that, despite stated intentions, not many people actually transferred their money to a credit union from a large bank (feel free to check our historical press releases or my blog archival for more on this)

The second finding, perhaps hidden in the shadow of the primary one, is that more people did transfer their money out of a large bank! (WHAT??!!) Read the rest of this entry »

European Central Bank warns of virtual currency risks

As posted on Finextra just now, as a comment to the blog “European Central Bank warns of virtual currency risks”

At Javelin we’ve published two research reports on virtual currencies, and the surprisingly sparse attention they received shows that the payments and banking industry is failing to look far enough ahead. Our conclusion from research of consumers combined with review of the industry triad of gaming, banking and payments found that virtual currency is surprisingly advanced for something that has escaped the spotlight. Because some virtual currencies can be converted to traditional currency right now, this represents an unregulated area with potential significant mainstream impact. Kudos to The European Central Bank for focusing on it, and here’s hoping others follow their lead.

Is Mobile causing $10B in fraud? Javelin data: not likely

The article “Banks Pushed to Clear Fog of Cyberwar” on page one of Wall Street Journal’s Money & Investing Section includes these conclusions:

  • $10 Billion is the total of all “losses for identity theft committed through mobile devices”
  • $263 Million is the total of all “losses from online fraud that targets corporate accounts”

We’re struggling with the $10B figure (the data was attributed in a non-specific way to Verizon, Pindrop Security, and Aite) Read the rest of this entry »