WESTBURY, N.Y. — When it comes to technology, don't expect any game-changing innovations in the next year. Instead, credit unions should expect to see increasing functionalities within technologies that already exist, including an emphasis on self-service channels.
Robert Reh, a member of the executive committee for the CUNA Technology Council, told Credit Union Journal that the move toward increased self-service may ultimately be the defining technology trend of 2014.
"That's something [consumers are] already accustomed to with other retail establishments," said Reh. "Lowe's and Home Depot, the post office, check-in at the airport; you're serving yourself at kiosks and other self-service sites. Financial institutions are moving in that direction. It's a cost-saving measure; you're going to be able to open branches and even transform existing branches into something that needs less space and is less costly by using this kind of technology."
Reh, who also serves as CIO at Nassau Financial CU here, noted that advanced ATM technologies are just one of the self-service solutions his credit union is considering implementing.
Credit unions, he said, "have to find ways to save money and better serve their members. Smaller credit unions more than the bigger ones need to look at going to these tellerless branches to save on costs and remain competitive."
Mobile Will Have A Big Role
Mobile banking, whether via tablet or smartphone, will continue to play a major role in the coming year, said sources, and it will increase the way members serve themselves at the branch.
According to Andrew Tilbury, chief marketing officer for BluePoint Solutions, use of mobile RDC will continue to increase, but that feature is primed to expand beyond just depositing money. "It's going to become more of remote document capture," said Tilbury. "We're going to see new functionality around members being able to capture actual documents, whether it's loan applications or pieces of ID to keep files up to date. All these sorts of things are going to become other opportunities for those apps to add value."
End Of The Beginning
Mark Sievewright, division president for CU solutions at Fiserv, noted that his top three technology trends for the new year are "mobile, mobile and mobile."
"That's somewhat tongue-in-cheek, obviously, but I do think mobile is really at the end of the beginning of its cycle," Sievewright said. "I continue to believe that we're just scratching the surface of how mobile will transform our businesses."
He noted that the number of consumers paying bills using a mobile device doubled in 2013, with more than 16 million U.S. households regularly using mobile devices for bill pay. Beyond bill pay and the payments space, however, the Fiserv executive noted that "we're seeing fairly rapid evolution" in terms of what can be done with tablets.
"The balances, funds transfer, payments, those things are becoming table stakes," said Sievewright. "But as we go forward, I think we're going to see more action in the personal financial management space around tablet PCs."
BluePoint's Tilbury, noted that there is still a lot of room for increased tablet adoption, particularly as the price point on those devices continues to fall.
"The thing about tablets versus smartphones is that they are inherently two different pieces of technology," he said. "You can't have the same strategy for both; you can't have the same product on both. If you have to pick one or the other, you have to have a smarthone strategy first, because there are more smartphones. That's just a default expectation that consumers have. If you can have a tablet solution, that's important because it does open more opportunities around sophisticated financial management [and] analytics around the account."
Reh doesn't share Sievewright's bullishness when it comes to tablets, however, in part because of the price point. He said that despite some limitations due to the sizes of screens and keypads, smartphones continue to have major growth potential, in part because such a high percentage of American consumers have them, whereas many CUs still have not fully utilized their functionalities. On the other hand, "not everyone can afford an iPad and not everyone needs one."
Reh said that Nassau Financial does not plan to implement tablet solutions in its branches, but many CUs have begun to do just that.
"That's becoming a new focus as far as how business is conducted within the branch," said BluePoint's Tilbury. "It's really not just about transactions anymore; it's more about relationship building. And I think that's a trend that's going to continue, because you don't need to be sitting at a desk behind a computer to do that."
Lending via mobile devices is slowly gaining steam, fueled in part by CUNA Mutual Group's LoanLiner.com, which in August hit the $1-billion mark, and its AskAuto app, which connects members to their CU while at the dealer lot.
Since LoanLiner.com's mobile-optimized loan application was launched in July of 2011, the percentage of applications originating from a mobile device has increased from 4.7% to nearly 19% today, according to Rick Uhlmann, senior manager for media relations at CUNA Mutual Group. While most of those transactions continue to come from smartphones, "we do see a healthy volume from tablets as well."
Fueling The EMV Fire
The data breach at Target made major headlines as 2013 came to a close, and some analysts said that event will have an impact well into 2014. (See related story on page 1.)
"The Target instance is going to fade away but you're going to continue to see large breaches like that," said Tilbury. He said he believes the Target breach is part of a larger trend as retailers continue to aggregate more data and become more involved in their customers' payments streams, which makes them more of a target.
"It's definitely going to fuel the fire of EMV," he said, referring to the process of FIs converting their cards from magnetic stripes to more secure EMV technology. "It's also going to put more scrutiny on how consumer data is handled and protected across the board. I wouldn't be surprised with these stories fi that results in greater regulation, which of course no one is a fan of on the FI side."
Robert Reh of the CUNA Technology Council agreed.
"In the past it was an accommodation to members traveling overseas that needed to use their cards, but now for security purposes, especially in light of what happened recently with Target, EMV chips are going to be widely adopted in 2014, and rather quickly."