Philip Ryan has a unique approach to banking: As an experienced writer and web developer, he looks at how banks can use technology in his role as associate editor of Bank Innovation. He spoke with us about how banking has changed over the last few years...and how it'll change over the next few.
How has banking changed in the last several years?
The growth of mobile has given customers greater flexibility and more options in choosing financial products. Younger customers in particular hold banks to higher standards - Amazon, Apple and the like - in terms of experience offered, and are less loyal to financial institutions generally. Banks need to offer strong mobile experiences and sound, unobtrusive financial guidance to young customers in order to earn their trust.
What are some important trends in banking consumers should be aware of?
Customers have a broad array of options depending on their financial needs. For customers needing transactional accounts, prepaid cards and accounts with low, transparent fees are available. For customers needing small loans, even those with weak or nonexistent credit, lower interest rates and better terms can be found from highly regarded alternative lenders. Friction and fees in moving money are both falling away rapidly.
What makes a good bank? What should consumers be looking for?
A good bank is transparent about its fees, swift to help resolving problems, and offers a wide range of easy-to-use services. Customers should seek banks that meet them where they are and meet their needs with excellent service. A strong mobile presence is also essential.
When thinking about taking out a loan or a similar financial product, what criteria should we be looking at in a lender?
Lenders should be up front about fees and terms, first and foremost. Customers should ask advice from other customers of the lender and seek lenders with good channels of communication. Many people want to lend money today - customers should be discerning and choose the product that works best for them. There are even non-bank lenders offering mortgages today.
When should we consider using an online-only bank? Are they as reliable?
The only thing to consider is if you need to go to the branch, and when were you last in a bank branch? Online banks need to offer superior online and mobile experiences that include check deposit and bill payment, and offer a strong network of ATMs for obtaining cash.
How do you seeing banking changing in the future?
Banking will become dissociated from "banks" and be viewed as services that are at hand when customers need them. Customers need assistance when shopping, so banks will move closer to the retail experience. Money is a digital commodity, and people use it along with their other digital activities, which are increasingly blending into everyday activities. Friction for accessing money will be viewed with increasing distaste, so financial service providers that lower friction will see better customer adoption.