Archive for the ‘Online Banking’ Category

Mining Online Gold

Watching the keynote from yesterday’s Apple WWDC gave me a whole lot of ideas for cool banking apps.  One thing that stood out to me was the $2.5 billion that had been paid out to developers since the launch of the App Store.

One reason that developers have stayed on the Apple bandwagon is that they make it so easy to get paid.  Apple tries to make everything is simple as possible.  Giving developers tools that help them get paid quickly and view reports about sales is one way to keep them happy.  If only banks and credit unions did the same.

Lately I’ve been working on my secret project, code phrase “Rice Krispie Treat.”  With some of the planned features, I have need of a merchant account.  Every single bank and credit union that I viewed online offers business services.  Unfortunately, I have to call someone and set up an appointment to get started.

Compare this with companies such as PintPay, Chargify, Recurly and CheddarGetter.  In about thirty minutes, I can sign up and be ready to accept payments on my website, all from the comfort of my couch at home.  Actually, it would take that long if I wanted to fully integrate their gateway into my site.  For basics, it’s less time than it would take to open a checking account.

Commercial customers are the lifeblood of a financial institution.  Giving them tools that help them run their business better should be a higher priority.  They need more than online banking.  Besides, if I can sign up my business for online banking while online, I should be able to obtain other services online also.


Security Questions Are The Devil

Sign-up for your bank or credit union’s online banking and you’ll most likely be asked to select some security questions and answers.  This is one of the safeguards used to cut down on fraudulent access to customer accounts.  This is also the security feature that I hate the most.

Well, let me amend that.  I hate the current, typical implementation of security questions.  The problem is, all the questions are easy to figure out if you know the targeted customer.  Lately, what I’ve seen is instead of selecting from ten questions, you now have twenty to choose from.  All this means is someone I met after I finished college may not know the answers, but a childhood friend might.

There have already been plenty of high profile examples of celebrity online accounts being hacked through security questions.  The generic choices given aren’t that hard to figure out.  A quick search on Facebook (who uses security questions in typical fashion) will answer a majority of them.  All you have to do is dig through a person’s wall posts and their profile.

A simple solution to all this is to let the user come up with their own questions.  There could even be a list of generic questions to use as a guide.  But it’s a lot better if the user types “What is your favorite cartoon episode” instead of selecting “What was your high school’s mascot”.

Online Business Banking #FTW

April 7, 2011 3 comments

I was watching a recent episode of MSNBC’s “Your Business”.  In this particular one, they had a segment about embezzlement at a bookstore in Fairhope, AL.  Apparently, the bookkeeper embezzled over $100,000 over a two year period.  She used her position to hide bank statements, double pay herself, and write checks to pay her personal bills instead of vendors.

The owners mentioned that because they were so busy trying to keep the business afloat, they were lax in following up on the financial health of their business. Now, I was confused as to why they didn’t regularly meet with the bookkeeper.  They also never had an audit performed by an outside agency.  But their biggest issue? They didn’t have online business banking.

What gave it away was the part about never seeing their bank statements.  With online banking, they would have known within 60 days that something was wrong.  They could have also seen their check images and received alerts about wires and balance thresholds.  Such a simple service could have saved them a lot of heartache and alerted them to problems.

Dog Food Really Is Good For You

In the tech industry it’s called “dogfooding”.  Basically it’s when a company uses the products that it makes.  In the banking industry, it could be referred to as using the products a bank sells.

Most banks and credit unions offer online banking, bill pay, cash management and other online services to businesses.  Company executives and business services officers constantly extol the usefulness and ease of their electronic commercial services.  The question is, how many banks and credit unions use their own electronic commercial services?

Does Accounting use ACH to refund employees instead of cutting checks? Are e-bills used for credit card, power, water, security, telephone, etc. bills?  Are all these bills paid through online banking?  Are online payroll services used?  Are vendors paid through online banking?

I’m willing to bet that most banks and credit unions don’t take advantage of all the services they offer.  How can you get employees to use your services when the FI doesn’t even take advantage of what it offers?  More importantly, how can you sell a service that you don’t even take advantage of?  Do you not want the same cost savings that you claim your customers will get by using your services?  Especially given today’s environment where cutting costs and increasing efficiency are high priorities.

Photo from

Categories: Bill Pay, Online Banking

iPad and Banking

April 8, 2010 3 comments

The Financial Brand sent an interesting tweet earlier: “If online banking works fine on iPads, then why would a financial institution ever need to build an iPad-specific app?”

Maybe it’s the geek in me, but I see the iPad as a way to redefine online banking.  While having lunch this week with a couple of co-workers and  Bryan Clagett (@clagett) of Geezeo, we talked about online banking in general.  Most FI customers currently go to their FI’s homepage and then go directly to online banking.  They never look over the other information that’s listed on the website.

I believe an iPad app can be more beneficial to customers.  For instance, you can push balance/transaction alerts.  You could also push alerts about rate changes and marketing events or even iAds.  An iPad app would give a FI the opportunity to make mobile banking more PFM like, which would be a much better experience.

My point is, if newspapers can see the benefit of having an app instead of just letting people go to their website, there must be some tangible benefit.  You’re only limited by your imagination.  I believe most online and mobile web banking experiences are pretty crappy.  The iPad gives you the outlet to really do it right.

Picture by d!zzy/flickr

Banking On Mobile

February 3, 2010 3 comments

Apple’s announcement of the iPad has sent ripples throughout all industries.  The biggest question is, can we use it to further our business goals?  NetBanker has a post about what the iPad could mean to banking.  But before I get into that, I’d like to share some thoughts about the iPad in general.

To my core, I believe the iPad will have a much bigger effect on household computing than the Wii did on home video games.  When the Wii came out, it was considered a weak machine when compared to the competitors.  The wireless, motion controller looked cool, but it was a kids’ system.  Sony and Microsoft still haven’t reached the number of sales to that of the Wii.

While the PS3 and XBox were geared towards hard core gamers, the Wii was targeting causal gamers.  Nintendo went after everyone that didn’t really play video games, which is a much bigger market.  Say what you will, but I know a lot of people that ended up with “Wii-bow.”  The Wii was embraced by a market of age 2-100.  Adult care facilities even picked up a few systems for their residents.

Now, looking at the iPad, I see the same potential.  Blog posts by Ethan Nicholas on TechCrunch and Dan Moren at Macworld reinforce that belief.  There are plenty of posts, such as Randall Kennedy’s at Infoworld, that talk about how the iPad won’t kill the netbook.  I don’t think the iPad will completely kill the netbook, but it will make it irrelevant to the masses.  You see, the iPad isn’t geared for geeks or even heavy computer users.  It’s for all those people that want something that is easy to use and just works.

Being an IT guy, I too have to do tech support for my family and friends.  An iPad takes all that away.  There is no need to install anti-virus software and keep it updated.  No silly spam blockers, firewalls or driver updates either.  The iPad is a closed system, so it takes all those headaches away.  Plus it even functions as an e-reader, which is one thing that I can’t wait for.

I think the iBookstore will really open people up to using electronic devices.  One example is my wife.  This past spring I was going to get a Kindle for her.  Now, we read an average of ten books a month between the two of us.  She wasn’t interested in the Kindle at all.  She wanted to actually hold a book and turn the pages.  That was the best experience to her.  Well, her mother gave her a Kindle for Christmas.  Now I believe she loves that thing more than her Blackberry Storm and iPod combined.

Once people get an iPad in their hands, I believe they will love it just as much.  Oh, and one knock I heard was that it was a wi-fi device, no ethernet connection for when no wireless was available.  A lot of these potential households have wireless networks because they also have Wiis, PS3s and XBoxes.  So it will mostly be used at home or in places with a wireless connection.

So, how does this relate to banking?  Well, all these new iPad owners will become a lot more comfortable with computers in general.  They’ll finally have a device that is intuitive and makes checking their email, browsing the web and reading books simple.  As they get more comfortable, they’ll spend more time in that App Store and they’ll discover even more apps that fit into their life.

This is where your bank comes in.  All those customers that just weren’t interested in internet banking?  Now they’ll have the device that helps make them more open to using your service (hope your IB provider supports Safari and not IE6 only).  Even better, if you have an app in the App Store, you can provide a better banking experience to them.

If you didn’t have a mobile strategy before, you might want to start working on one now.  There will be a lot more people that want an iPad for home use than those that want an iPhone with AT&T.

Also, join us in Charleston on Feb. 27th, 2010 for BarCampBankCharleston where we can discuss topics like this in an informal group setting. The information site can be found here and registration here. This is a free event so come on down.

Picture by d!zzy/flickr

Help Us Help You

February 1, 2010 1 comment

Lately I’ve seen quite a few articles about small businesses being targeted through online banking.  Small businesses are facing they same challenges that their banks and credit unions are: they aren’t able to have staff dedicated to watching this threat.  What’s being reported however, is that each side is casting blame.

Now, working for a bank, I can understand their point of view.  Being a customer, I can also see the businesses’ point of view.  From the bank side, if they are offering as secure of a website as possible, they’re doing their part.  This does include using SSL and having security features such as multi-factor authentication, IP address logging and secure tokens.

Businesses also need to do their part.  Some experts have suggested that businesses use only one specific computer for online banking to help minimize their risk.  I think it’s deeper than that.  Small businesses need to start making computer security a higher priority.  I understand that they may not have an IT person on staff.  I also understand that bringing in a consultant can be expensive.  But it only takes one hour of their time to Google information about firewalls, anti-virus software and spam blockers.

If you are going to trust your financial institution to handle your money for you online, you also need to accept your part in the relationship.  Here in 2010, anyone using a computer should have heard that computer viruses are a bad thing.  Taking simple precautions, such as having up to date anti-virus software and using a firewall is a must.  Also, checking your accounts daily can help discover theft quickly.  Remember, banks may not have the staff and/or systems in place.  But a company should check their accounts more than twice a month, when pay checks are sent.

When both parties in the relationship fail to hold up their part, you end with a situation like a bank suing their customer over cybertheft.  In this particular situation, the bank was said to have weak authentication measures.  However, as the theft happened over two or three day period, that means no one at the business checked the accounts daily.

If there were alerts set up, they may not have been triggered.  I did test drive commercial online banking at PlainsCapital and must admit that the alert offerings are pretty lacking.  For instance, there is no way for a business to easily setup a daily balance alert.  But this is the online banking vendor’s fault, not PlainsCapital.

To keep situations like this from happening in the future, here are some things that banks can do:

  1. When adding users, the requests should only come from designated points of contacts.  No “employee” should be able to just ask for access to online banking.
  2. When users are added/changed and passwords changed, an email should be sent to the company administrators.
  3. Either the company administrators should set user access and privileges or the bank sets them according to the administrators

For the businesses:

  1. Make sure all firewall, spam blocker and anti-virus software is up to date.
  2. Make sure anyone with access to online banking understands basics about recognizing spam and understand they they of all people should not just click on links that “friends” send to them.
  3. If your bank/credit union offers alerts, set them as a safety precaution.
  4. If the password you use is on this list, CHANGE IT IMMEDIATELY

Photo by AhhYeah

Categories: Online Banking, Security