What problem are most banking applications really trying to solve? That’s what I’ve been thinking about for some time. I thought maybe last week’s Finovate would help me understand what we’re all trying to achieve, but I think I was wrong. It seems most innovations are coming from a place where founders are looking for exits, or established players are protecting their turf. In other words, it’s still all about the sliver of money on the edges of every transaction.
Hasn’t Apple already proven that a simple, user-driven experience can drive not only profit but user delight? But I digress. Maybe it’s too much to tackle here, but maybe, just maybe, it’s time to reimagine our applications.
What real problem do most banking applications try to solve? Seeing where we spend money? How we are doing against budget? Well, most Americans at least seem to be doing a good job of avoiding that just fine. Most online banking applications are focused on data from past events, rather than solve the need to understand the implications of certain spending behaviour that’s truly meaningful to future actions. Beyond the transaction, most applications outright ignore the important larger implications of how we spend, the matching of that data with lifestyle changes, or further refined life-changing needs.
This is why we need to move forward with the notion of solving issues related to ‘banking activity’, like payments, but it goes beyond payments as well. It’s also inclusive of what banking is moving towards: technology driven butler-like services with human intervention when needed for further understanding of one’s financial condition. Let’s solve the real-world problem of maximising budgets by minimising expenses; by driving very specific rewards and offers that actually mirror user data, on the consumer and business side. We have blatantly ignored the value of big data in our industry for some time. It’s time ‘simple’ applications solve some big problems for our clients before startups figure out a better way and truly reduce traditional banks to a serious of dumb pipes. Oh wait, perhaps too late.
Finovate Best of Show winners included BehavioSec (security applications that leverage user pattern recognition), BillGuard (which now includes crowdsourcing of credit card transactions to help resolve disputes), Dwolla (adding FISync, which lets banks and credit unions originate cheaper real-time ACH-based payments), iQuantifi (interesting financial planning tools), MoneyDesktop (great new tablet/iPad UX for PFM functionality, additional proximity-based deals platform which has a lot of promise), Personal Capital (portfolio PFM iPhone app that (finally) includes PFM interbank funds transfer), and SoMoLend (SBA/Business based P2P lending and interesting use of alt-credit data). [Editor’s update: SoMoLend shut down 20 August 2014.]
One of the things that stood out was that, outside of a couple of interesting interfaces, there was a real dearth of focus on design and overall user experience from the field of 63 companies. Maybe it wasn’t all that bad (or maybe it’s because I’m posting this on the Monday after), but only a few UX things stood out for me in the field of demos related to payments, deals, security, and B2B applications.
The best summary of Finovate (outside of the official Jim Breune feed) was probably that from Eric McCune of Glenbrook, for its PaymentsViews. The #Finovate twitter feed did pump praise out for at least two of the eventual Finovate winners, MoneyDesktop and Personal Capital, mostly for making PFM interesting again, but much of what the crowd of nearly 1,500 bank, fintech, and valley money folks saw was kind of the same old stuff when it came to design.
Here are additional links and summary of Finovate Best of Show Winners. It’s time to rethink how we design banking applications.
Maybe we should reimagine ‘banking’
I say the above because even Simple’s UX seems old to me now, and it’s not even in general release. Plus, no one I know is actually using it yet. Many of my contacts at Finovate seemed to feel the same way. While many of us in banking are rooting for Simple (and Moven, etc), after 18 months of alpha and beta testing, are they going to deliver a truly simplified banking experience? Maybe we expected too much.
When do the rest of the 100,000 people on the Simple waiting list get to take a test drive to see what $13m in funding has built? When will Simple break through and show us that good design alone can disrupt banking? Here’s what we know about what you can do with Simple’s new iPhone application, so you can decide for yourself:
- View your transactions. Real-time refresh of transactions (this should be in all mobile banking applications by now, right?). Are any of our systems still relying on batch pushes of data to our mobile apps? No (OK, I hope not). I get real-time updates from several banking applications, so nothing seems new here, but the video below makes it feel somehow superior – so an A for the marketing effort on this feature. Overall though, I’d give this a C because every application should update once a transaction has occurred.
- Send payments. Add payees and schedule one-time or recurring bill payments. OK, some news here, as real-time ACH is sort of embedded, but shouldn’t all applications that include bill pay and P2P simply mirror this type of payment application natively? That’s the problem, the most obvious use of payments (P2P through existing contacts via the mobile device) isn’t application ubiquitous. But it’s thankfully on every provider’s radar, as mobile payments are seen as the next holy grail to banking, so were seeing mobile P2P applications in every form (Amex’s Serve & Pre-Paid, etc), so there is hope that mobile – P2P and bill pay – will be tied together in a single simplified payment mechanism. I’ll give them an A- for this with the hope that more people will copy what’s here. At least let people initiate a simple P2P/merchant payment to an established payee, then move to sending money to anyone, anywhere with a mobile number or email address. There is so much low-hanging fruit in payment applications, but I digress.
- See each transaction in detail. Simple will categorise and map it for you. The one thing Simple gets online (and presumably in mobile) is the ability to review transactions via location, or proximity. Why aren’t more applications leveraging their proximity tagging, whether inferred from the transaction data stream, ACH, or proximity tag at payment? Simple gets an A for that, but shame on more developers for not leveraging this data out of the box. If you have the location of a transaction, you should be able to map it and then leverage that data lookup in the presentation layer. But what do you do for an online payment to Amazon? I’d have a lot of payments in Seattle, and I haven’t been there in a few years.
- Organise your transactions. Edit description, category or location. Another thing that should be embedded in every application – this is finally starting to become commonplace. So a B here for additional tagging capabilities. We need to see this grow, since PFM categorisation, even those that are automated, fail too often when aggregation connectivity and transaction data break.
- Write a memo for any transaction. Keep track of what you buy. Simple gets an A here, and while I imagine the UX is pretty streamlined, I want to see how consistent this is across platforms. The biggest problem with memo posts are the transition of this data between devices and applications. I’m assuming this is centralised at Simple, and bravo for extending a historical business need to consumers (this should have occurred over five years ago, especially around payments). What we aren’t seeing as often is the ability to add several tags to the same transaction. If we could do that to photos for years, why not financial data? Oh wait, that would make Simple a billion-dollar startup.
- Search transactions. Find all your transactions from a particular restaurant. Nothing really new here, but again, the overall UX and simplicity is key to this being done right. B for the inclusion, and probably higher for the overall user experience.
- See your safe-to-spend balance. Know your spending cushion immediately. An obvious A for the marketing around this, but several PFM providers have been providing this data presentment in different forms for years. The problem is that Mint, FinanceWorks, Geezeo, MoneyDesktop, and others have their PFM functionality relegated to another tab or link within online banking. To me, this is the fintech space’s big fail. PFM isn’t really just PFM, it should be front and centre and simply replace online banking, so an F for everyone in fintech in the end. Real-time money management with every swipe, every NFC transaction, every alert (simplified actionable alerts like Clairmail has had for years) … where is fintech’s true money management for mobile? That’s the type of user experience we’ve been waiting for. Look for the innovation in this space to come from the merchant reward side of mobile payments. That’s kind of unfortunate, as I would rather see the innovation in helping someone manage their personal and business expenses, but fintech developers are chasing the money and I don’t blame them.
- Find nearby ATMs near your current location. Every application should have this. PNC gets an A for its efforts with PNC Finder, but overall we should do more. Show me all ATMs, and let me sort the data and decide if I want to pay a fee to get cash. Simple gets a B here, as I’m assuming it works well, and allows for some interesting ways to display the data.
- Contact customer service. Customer service is just one button away. If this also includes its social contacts from Twitter and other social media, it gets a B+. Most mobile banking applications fail at providing anything but a phone number. We need links, FAQs, mobile-optimised demos, social connectivity, click to call, appointment setup, and so much more. Same goes for the more robust online and tablet applications. I think this is an area we need to completely rethink. Spend some time in a call centre and you’ll know what I mean. Or better yet, personally answer emails from your customers, as Josh and the team at Simple have. They get upgraded to an A for that alone.
Unless I missed it, I’m glad we don’t see mobile capture in the app. Even if it’s planned, why are we spending so much energy on mobile capture when paper cheques are dying? The same goes for capturing paper receipts. We need to move every step of the payment process beyond the legacy of paper.
What might be next? Where are the tools to help a small business owner who leverages their consumer accounts to manage their business? Where are simplified goals to tie to that safe-to-spend balance? Where are the notifications to alert a user of a transaction or to ask a simple yes/no to an automated bill payment? Where are proximity based merchant rewards? Where is merchant-based bill payment? Where is a tie-in to NFC or alt-payment providers such as Square if someone wanted to send money to the user? There are a lot of applications that can be added that can still be part of a simple banking application.
Just today, we’re seeing a new focus on the ‘Spend Graph‘ data from American Express. We need to see more of this embedded in our applications, as well as a renewed focus in leveraging aggregated data to the benefit of our consumers and business customers. There’s promise here to solve one issue: present offers based on real-time spending habits, and deliver value for consumers and business partners. But it can still be so much more than this. I think PFM providers have the keys to the kingdom, but I’ll save that for another post. It has to do with some Groupon-like functions around preferences, and some writing I’ve done around hunch.com and the ‘Taste Graph’.
If Simple can (and I imagine will) do even more when it comes to overall application design (meaning function) and overall user experience, how does the rest of what we saw at Finovate stack up? How will Movenbank’s mobile-only approach stack up? I really am a fan of what Josh and his team are doing, as well as Brett and Scott and the gang at Movenbank, but we’ll have to see. I’m hopeful. For now, I say it’s time to take a long walk and think about how we can redesign from the ground up. Keep it simple, but design your banking applications without ‘banking’ in mind. Let’s focus on solving some real problems.
Here are some more links on what people thought of the Simple app. Like the rest of us, these articles are just reporting the promise of the application, not an actual review of what it’s really like using it. Hopefully, I’ll get some more out on Finovate in the next few weeks.
From FastCompany: BankSimple has gotten a lot of buzz since (FastCompany) first wrote about its user-friendly design philosophy back in March. With good reason: The user experience of online banking is wretched. As BankSimple CEO Josh Reich tells Co.Design, “Banks make the most money when you make mistakes.” His bank is designed for the opposite purpose: to help you better understand your personal finances so that you can actually accomplish your goals. He gave Co.Design a tour of BankSimple’s soon-to-launch iPhone app, which was so important to BankSimple’s strategy that they designed it before the desktop browser version.
– This article is reproduced with kind permission. Some minor changes have been made to reflect BankNXT style considerations. Read more here. Image: Login, Shutterstock.com