The Bankwatch

Tracking the consumer evolution of financial services

Archive for the ‘Online Banking’ Category

Electronic bill presentment and payment needs an open solution | netbanker proposes one solution

Jim at Netbanker paints a great picture here about the potential for Doxo as a widepsread method of electronic bill presentment and payment (EBPP).  Having watched the evolution of EBPP both across North America and specifically in Canada with BMO and ePost since the ‘90’s the base business case has always been biller cost reduction.  There still remains the key question of what it will take to get to scale that allows the billers to actually reduce costs.

While billers see cost reduction from paper and postage, they must still maintain some infrastructure for managing the monthly statements.  It seems to me the real impetus for EBPP will be something that make it the easiest thing in the world for consumers  The integration with online banking was an assumption that it turns out was flawed and not for all.  Consumers need a choice, and choices need to, generally speaking, be open – not a lock-in solution.  Maybe a Doxo/ ‘facebills’ (sic) solution is the right approach.

Launching: Will Ebilling Startup Doxo Become a Household Word? | Netbanker

Why would billers pay for it?

  • It’s a fraction of the cost of paper + postage
  • Adoption of estatements has stalled at 10% to 15% of consumers even for billers who’ve worked relentlessly to get rid of paper; and the easy way to get adoption, charging for paper statements, get both consumers and politicians all worked up
  • The Doxo platform provides a direct, secure, communications path to end users; including marketing messages
  • No advertising from competitors makes Doxo more desirable than other third-party systems where billing info might end up residing (e.g., Google/Gmail, Mint, etc.)
  • The network effect; managing multiple bills in one place is the carrot to get consumers to give up the paper
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Written by Colin Henderson

October 23, 2010 at 18:53

Posted in Online Banking

DNSSEC 5th May 2010 at 17:00 UTC | is this another Y2K?

A little known event occurs Wednesday.  The 13 root nameservers that run the internet by ensuring those obscure numeric IP addresses resolve as friendly english words for us, are getting a security upgrade.

DNSSEC is designed to solve a flaw in regular DNS used by the root servers to date.  When you type in your url, a check is run through DNS servers to obtain the numeric IP address which then locates the site you are seeking.  As clunky as it sounds this happens very quickly in milliseconds.  It does this by caching the dns information held at the root nameservers closer to your computer, at hosting services, ISP’s etc.

The security issue arises whereby bad guys can intercept the request to the DNS server by pretending to be one themselves.  Then your friendly bank URL can be directed to the bad guys server and while it looks like your bank in fact you are handing off your credentials to bad guys.

DNSSEC adds a security layer to the DNS request, which is intended to maintain its validity by keeping a chain from the root servers all the way out to the ISP DNS servers.  There is much debate over the workability and even the viability of this exercise.  It has been debated for over 15 years.  Time will tell – that is not my issue today.  The issue this week is that DNSSEC is being rolled out and only a few DNS systems have installed DNSSEC.  A related issue is the size of packets used for DNS.  DNSSEC uses a 512 bytes limit.  There are protocols for how to treat those over that size but from my reading over the last few weeks it seems that treatment is not consistent, and this is the most likely cause of problems when the change is made.

No-one is quite sure what will happen on DNSSEC day +1.

Today it appears that some services are having DNS issues and one can only conclude that there is a problem brewing.  Expect choppy waters over the next few days.

Written by Colin Henderson

May 3, 2010 at 12:50

Posted in Online Banking

Survey shows shift in consumer preference away from visiting bank branches

This is a significant survey with online banking leading over branches for the first time in consumer preference. (ht netbanker)

olb preference

Survey shows shift in consumer preference away from visiting bank branches

WASHINGTON – A new survey by the American Bankers Association shows that for the first time, more bank customers (25 percent) prefer to do their banking online compared to any other method.


“This marks a watershed change,” said Nessa Feddis, ABA senior counsel and retail banking expert. “It tells us that for the first time, more consumers prefer the speed and convenience of conducting their banking transactions on the Internet than visiting their local branch. It also tells us that consumers now have confidence in the accuracy and security of online banking,” she added.

Written by Colin Henderson

September 22, 2009 at 09:20

Posted in Online Banking

Tagged with ,

Are we finally seeing the demise of the bank branch

Finally we are seeing hints of what we all know is inevitable.  It has taken a long time and probably this latest economic crisis, but the long view on branches suggests a damatic shift with less of them.

Slow but inexorable move to online banking

Yet slowly but surely, the internet is starting to make its mark on the sector as more people move their banking online. Lloyds is to shut up to 400 branches as part of its integration of HBOS. Its rivals are likely to follow suit.

A decade from now, the local branch could well be an endangered species as “cyber-banking” grows ever more popular and more branches close.

Written by Colin Henderson

July 7, 2009 at 01:37

Japanese online shopping site Rakuten to open eBank

Rakuten [wikipedia Site]  is a highly popular Japanese shopping destination online, where you can get anything, from laptops to shoes to travel, you name it.  Now they are adding their own bank in 2010.

The aggregated model exemplified by Rakuten works well in Japan, and the addition of banking is one more innovation for traditional banks to contend with.

Rakuten online shopping mall to open eBank

rakuten w107

TOKYO, Jun 04, 2009 (Kyodo News International – McClatchy-Tribune Information Services via COMTEX) — Internet mall operator Rakuten Inc. said Thursday it will rename its Internet banking unit eBANK Corp. as Rakuten Bank before late June 2010.

Researched by Nobuyo Henderson

Written by Colin Henderson

June 4, 2009 at 17:00

Wesabe introduces a redesigned site with enhanced features

Wesabe have introduced a redesigned site.  It appears to be more than a surface change with nice use of interactive ‘hover’ features with personalised information inside the hover.  The menu is simplified, yet takes you to everything required, including ‘Connections’ that includes iphone and twitter connections.

Its clean, bright, and worth checking out.


Wesabe Site Redesign

If you haven’t logged in to Wesabe lately, you’re in for quite a surprise. We’ve redesigned every single page of the site and have been getting some rave reviews about our new look!

Written by Colin Henderson

May 26, 2009 at 11:22

We will not hear about bricks and clicks after this recession

Deloitte pick up on an interesting characteristic of banks here. Cost cutting occurs during downturns, but its spend spend spend when things are looking good.

Banks rarely get to the point of incremental efficiencies that they note here. Citi are a classic example as noted in the FT this morning.

This fits with the view that this change we are undergoing is not just another blip before we return to business as usual. There is no business as usual coming. The future is smaller, framed in different business models, contains a greater mix of small business, and smaller companies and with retail consumers working harder, longer and for less money.

All this points to realignment of the banks’ models to be more efficient, more effective in customer interaction, and more automated, with much greater reliance on online banking and mobile banking, with less on branch banking.

This time we will not hear about ‘bricks and clicks’ as we did in 2002.

Improving Efficiency: The New High Ground for Banks | Deloitte

The turmoil in the financial markets, coupled with the economic downturn, is fundamentally altering the financial services environment. In this new world, improving operating efficiency has become a competitive necessity. But while financial firms have typically moved quickly to reduce costs when the business cycle is contracting, far too often these efforts have been quickly forgotten when business picks back up.
In this report, we present research conducted by the Deloitte Center for Banking Solutions demonstrating the critical importance of operating efficiency to the fortunes of financial firms. Among the findings is that building efficient operations is not enough — steady, continuous improvement in operating efficiency are required. In fact, banks that have achieved continuous improvements in efficiency have also generally experienced far greater gains in their share prices.

Written by Colin Henderson

May 22, 2009 at 10:59

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