bbva innovation edge. mobile banking (english)
DESCRIPTION
What's going on around the world in mobile banking? Here, conceptual "pictures" of mobile banking practices around the world are presented, covering 12 countries in four continents. In this issue we sum up the best social business case study and we analyze future opportunities around it. ´BBVA InnovationEdge' is the first corporate multiplatform magazine focused on innovation. Each edition featuresarticles, analysis and huge information about a particular theme. The mainpurpose of the magazine is to express the new trends and the upcomingtechnologies that may impact to the financial industry.TRANSCRIPT
page 1Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
2APRIL 2012
NEW EXPERIENCE IN THE POST PC ERA
Mobilebanking
Mobile (R)evolution
Opening the doors for our customers
Global snapshots
Forecasting for innovation
Trending issues
Technology trends
page 2Innovation Edge April 2012 | MOBILE BANKING
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Anywhere World
Enabling an Anytime,
New innovations are providing novel ways to enable an “always on” society: mobile, social, and cloud technologies are being interwoven into the fabric of everyday life creating new value or offering new efficiencies. The mobile handheld device is becoming the touchpoint for a wide array of products and services, as mobile devices are the “go to” gadgets for most consumers. Businesses want to be well-positioned to take advantage of the opportunities, including financial services companies.
page 3Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
2000
719 million 6.16 billion
2011
DEVELOPED COUNTRIES: 469 million (65%)
DEVELOPING COUNTRIES 250 million (35%)
DEVELOPED COUNTRIES: 1.64 billion (27%)
DEVELOPING COUNTRIES 4.52 billion (73%)
2005
2.21 billionDEVELOPED COUNTRIES: 990 million (45%)
DEVELOPING COUNTRIES 1.22 billion (55%)
mobile subscribers mobile subscribers mobile subscribers
The first commercial mobile service was
launched 32 years ago in Japan, as NTT Do-
CoMo began offering mobile communica-
tions service to customers on December 1,
1979. Today, we are on the cusp of pervasive,
global connectivity, as mobile phones have
broken the 6 billion subscription mark in 2011
(See the mobile penetration graphic below).
Although much of the technology “under the
hood” has changed since the early days, in es-
sence, mobile devices have transformed from
a simple phone to a personal computing and
communication device in a handheld format.
While the world is still exploring and discover-
ing additional opportunities that mobile tech-
nologies may offer, it’s clear that we are on our
way to an anytime, anywhere economy. With
the right business model, companies can
serve 6 billion customers using mobile tech-
nologies: for creating and maintaining “sticky”
relationships with customers; and as the main
channel for the delivery of the companies’ val-
ue proposition in a customer-centric way.
source: Communities Dominate Brands | Celebrating 30 Years of Mobile Phones, Thank You NTT of Japan. 2009.
source: ITU (International Telecommunications Union) | Key Global Telecom Indicators for the World Tele-communication Service Sector. November 2011.
Mobile penetration timeline
CONNECTIVITY
Mobile banking and other related products
and services would not be possible if our
world wasn’t connected. Thanks to telecom-
munication companies (referred to as Mobile
Network Operators or MNOs), 6 billion peo-
ple can potentially participate in the global
mobile technologies.
(10’ tour)
page 4Innovation Edge April 2012 | MOBILE BANKING
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economy with a mobile phone. That sounds
like great news. However, the connectivity
providers are not a happy bunch these days.
They are upset because they feel as though
they weren’t allowed to extract maximum
value from their investments in infrastruc-
ture. While Amazon, Facebook, Google, and
a whole lot more were striking gold in the
Internet, the connectivity providers were left
standing practically empty handed, relegated
to the “pipes only” business with unflattering
margins. Put that together with the ongo-
ing shrinkage of their traditional voice busi-
nesses (both fixed-line and mobile), one can
see why the telecommunication companies
are strongly motivated to explore only those
business models that make sense for them
in the mobile space. The telecommunication
companies are extremely important, as they
are providers of access and bandwidth. If the
connectivity providers can’t make compel-
ling business cases for the forthcoming ma-
jor upgrades, such as LTE (Long Term Evo-
lution, a next generation technology which
provides sufficient bandwidth for 2-way
streaming of high-quality live videos); the re-
ality of anytime, anywhere business models
may be delayed.
DEVICES
There are two main types of devices: “dumb” and
smart. The “dumb” devices are also known as
“featured phones.” They are the familiar phones
that our parents and grandparents envision
when they think about a mobile phone. Then
there are the smart devices, the ones that are
leading the way in the post-PC era. The smart
devices are sub-divided into tablets (such as the
iPad and Galaxy Tab), smartphones (iPhone,
Blackberry, Galaxy S, etc.), and handhelds (iPod
Touch, PSP, DS3, etc.). Essentially, they are pow-
erful computers in an ultra-compact format. At
the end of the day, the customer will access any-
time, anywhere products and services via these
devices. The device manufacturers will spur new
capabilities and, in turn, will spark new business
cases, such as NFC technology (Google’s Wallet
is an early example).
OS PLATFORMS
The aforementioned devices need an OS
(Operating System) platform to run. Currently
there are several OSs in the market, such as
Apple’s iOS, Google’s Android, RIM’s Blackber-
ry OS, Nokia’s Symbian, Nokia/Microsoft’s Win-
dows Phone, Samsung’s Bada, etc. For smart-
phones and smart devices, Android and iOS
are clearly leading the pack.
APP STORE PLATFORMS
Although the most popular and best-known
app store platforms are offered by OS plat-
form providers (for example, Apple offers the
App Store for iOS and Google offers the An-
droid Market for Android OS), there are also
other app store platforms, such as the ones
page 5Innovation Edge April 2012 | MOBILE BANKING
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provided by some MNOs. Also, the concept
of app store platform is also evolving as we
are noticing the emergence of enterprise
apps and private apps store concepts.
APPS
The word, “Apps,” automatically provokes an
image of these really cool buttons that we tap
on our handheld devices to do things. Tech-
nically, those apps are known as native apps.
They are custom-built applications that run on
a specific OS platform, often times written for
a specific device or set of devices. They offer a
rich experience for the end-user as the device’s
capabilities are incorporated into the app, such
as NFC, GPS, camera, etc. However, there is a
price to pay for the richness: native apps must
be developed per individual OS platform, which
can quickly push up the costs of development.
On the other hand, there is another type of app
(although lesser known): web-based apps. In
essence, any “mobile enabled” site accessed
via a mobile browser can be considered a web-
based app. The advantage of this approach is
the “write once, publish many times” capability
as web-based apps are device agnostic. Most
people think that web-based apps are unflatter-
ing but new developments such as HTML5 are
quickly blurring the line between web-based
apps and native apps; and it may prove to be a
robust and cost-efficient way to produce apps
that provide a rich user experience.
Connectivity
Devices
AppsA
App Store
OS platforms
Wireless connection to the network
KEY PLAYERS:
Mobile Network Operators (MNOs), such as Telefonica, ATT, Verizon, etc
Handheld device manufacturers
KEY PLAYERS:
Apple, Samsung, HTC, Nokia, LG, Sony, Nintendo, etc
Operating System of smartphones, tablets, or other devices
KEY PLAYERS:
Android, iOS, Blackberry, Windows phone, etc
Virtual Store for app purchases
KEY PLAYERS:
Apple´s, Google´s Android, RIM´s App World, Nokia´s, etc
Native or web apps
KEY PLAYERS:
App developers
page 6Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
Mobile(R)evolution
Retail Banking industry analysts define Mobile Banking as “platforms that enable customers to access financial services.” There are three main technologies employed in Mobile Banking: SMS, Mobile Browser, and Custom Applications; and collectively, they are referred to as “Triple Play.” In terms of business models, Mobile Banking offers banks new ways to relate to customers (acquisition & retention; and up/cross-selling opportunities) and a new channel (which also happens to be the most cost effective). Depending on geography and footprint, Mobile Banking can be “additive” or “transformative”; in other words, “One of Many” or “One and Only”.source: Juniper Research. White Paper: Banking on Mobile. 2009.
page 7Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
Technically speaking, Mobile Banking is
composed of three mobile technologies:
SMS (Short Messaging System), Browsers,
and Apps. Collectively, they are known as
triple play. These virtual customer relation-
ship touch-points and channels can be devel-
oped “by hand” by the bank or be purchased
“off the shelf” from Mobile Banking solutions
providers. Most banks are going the “safe”
route and adopting off the shelf solutions.
In order to differentiate ourselves from our
competitors, BBVA has chosen “the road less
traveled” and we are doing it “by hand.”
Functionally speaking, Mobile Banking is a
customer relationship touchpoint and chan-
nel. In other words, it is one of many different
touchpoints and channels a bank may have.
However, it is the touchpoint and channel of
choice of an increasing number of retail bank-
ing customers, especially Gen Y and Gen X.
source: Business Model Generation
To clearly understand Mobile Banking and its
implications, it may be best to think of it as
“additive” or “transformative”.
Additive: Mobile Banking as One of Many.
Mostly applicable in developed coun-
tries or metropolitan areas in developing
countries. Markets are highly competitive.
Generally, Mobile Banking is one of many
channels and customer touchpoints and
offers the highest convenience. Driven by
Smartphone/Smart device adoption. Gen-
erational issues are influential.
Transformative: Mobile Banking as One
and Only. Mostly applicable in rural areas
in developing countries and out of foot-
print areas in developed countries. Mar-
kets need to be developed. Mobile Bank-
ing enables (opens the doors to) previously
unapproachable, new customer segments
and offers access to banking products and
services. Driven by inexpensive handsets.
Generational issues are less influential.
source: BBVA | Money for All ( Internal Document). 2011.
source: Juniper Research | White Paper: Bank-ing on the Mobile. January 2009.
page 8Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
Mobile
banking
technologies
SMS
Mobile browser
Custom aplication
USE. Widespread in developing world, many alert applications and some payment options in developed world.
PROS. Can be used across platforms and carriers, smart and dumb phones, easy to use and fairly safe.
CONS. Not permitted in some regions, some security concerns, reduced functionality.
USE. Widespread in developed world, particulary within regional and 2nd tier banks, mobile browsers connect mobile users to an augmented inter-net banking site.
CONS. Fairly common practice (no competitive advantage). Takes a number of steps to log in. Adaption to small screen not always done well.
PROS. Familiar to internet banking customers, simple integration with ex-isting internet platforms, works across devices and MNOs.
USE. Gaining significant traction in the developed world, used for mobile banking, coupons and location based services.
PROS. Provides a rich user experi-ence. More secure and stable. Retains loyalty and offers cross-selling opportunities.
CONS. Integration issues required for each device. Must be installed by customer. Can be more expensive to deploy.
page 9Innovation Edge April 2012 | MOBILE BANKING
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Like many other industries, the retail financial services industry is in the midst of disruptive changes: mobile, social, and cloud technologies are reshaping industries and creating new ones. Something new seems to be on everybody’s minds: in the retail banking segment, the something new at the moment is Mobile Banking.
doorsfor our customers
opening the
page 10Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
As part of an overall retail banking busi-
ness model, Mobile Banking offers the
stickiest touchpoint for banking customers
and most economical transactional cost for
banks. It also paves the way for new value
propositions and new banking models. How-
ever, as in other industries, new entrants are
aggressively entering into the retail bank-
ing business and posing new challenges for
bank executives as they explore and seek
out the right business model.
source: Bank Technology News | Banks Seek Sticky Relationships from Mobile Apps. February 2012.
According to the 2011 EFMA & McKinsey re-
port, “The State and Future of Mobile Bank-
ing,” mobile banking for the retail bank seg-
ment (as a whole) is a “zero-sum” game: “new
revenues have been largely captured by non-
banks, most players have yet to reflect the
convenience of mobile in their pricing, and
the experience of many has been that the
mobile channel is an extra cost rather than a
cost reduction opportunity.” Overall, the “val-
ue creation opportunity … is neutral at best.”
source: EFMA & McKinsey. The State and Future of Mobile Banking. p. 7. October 2011.
However, for individual banks, the report goes
on to say that there are three major opportunity
areas in Mobile Banking:
Ultra-convienient and innovative banking.
Digital Commerce.
Disrupting new markets.
Once the overall strategy for Mobile Banking
is formulated, each bank will have to integrate
the “additive” Mobile Banking into its retail
banking business model. For banks aiming
to be shapers, they will have to resolve the
“transformative” aspects of the model.
Strategy defines Opportunities
Ultra convenientDigital
CommerceDisrupting
new markets
Leader Multichannel to deliver ultimate convenience Drive sales via mobile Reduce cost to serve
Shaper Grounbreaking services Active partnerships First mover in unbanked and new markets
Follower Mobile friendly website and basic application 110100111001100100010
00111010101001001000
1010101001110101010010x x110100111001100100010
00111010101001001000
1010101001110101010010
110100111001100100010
00111010101001001000
1010101001110101010010
page 11Innovation Edge April 2012 | MOBILE BANKING
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Additive Mobile BankingAdditive Mobile Banking adds to the existing
business model has two main objectives: in-
crease customer stickiness and reduce op-
erating expenses by having a unified infra-
structure (for example, CCB). In general, the
bank offers Mobile Banking as a complement
with its other channels (please see the issue
No 1 for more information regarding banking
channels). This model is prevalent in devel-
oped countries or metropolitan areas in de-
veloping countries.
BENEFITS OF ADDITIVE MOBILE
BANKING INCLUDE:
Migration of customer transaction
to the lowest cost channel.
Adds to the customer-centric
business model.
May help banks to generate new value
propositions and revenue opportunities,
such as mobile payments and cross-sell-
ing/upselling opportunities.
source: Tower group. Fiserv. Mcom 2009
Call Centre$4.00
IVR$1.25
ONLINE
$0,17
ATM$0,85
MOBILE
$0,08
Branch$3.75
TRANSACTION COSTS BY BANKING CHANNEL
page 12Innovation Edge April 2012 | MOBILE BANKING
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In general, transformative mobile banking are prevalent in rural areas in developing countries and out of footprint areas in developed countries.
Transformative Mobile Banking Business ModelsTransformative Mobile Banking creates new
value for banks by providing access to new
Customer Segments, thus offering banks
new sources of revenues. In other words,
they can help banks go where it couldn’t go
with existing business models (BM). Transfor-
mative Mobile Banking aims to develop new
customers (unbanked and underbanked)
through the lowest-cost transaction channel
via a “branchless” strategy. This model is ei-
ther led by a bank, an MNO, a 3rd party (for
example, a mobile payment provider), or as
a joint venture between two or more par-
ties. The concept of ecosystem is important
here, as the banks’ skill and experience in
ecosystem management will likely become
a key skill to operate these BMs effectively. In
general, transformative mobile banking are
prevalent in rural areas in developing coun-
tries and out of footprint areas in developed
countries.
Thus far, three main Transformative Mobile
Banking Business Models have emerged:
Bank-led models, Mobile Network Operator
(MNO)-led models, and 3rd party-led models.
BANK-LED MODEL
MNO-LED MODEL
3RD PARTY-LED MODEL
page 13Innovation Edge April 2012 | MOBILE BANKING
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BANK-LED MODEL
The banks offer strong capabilities in treasury, risk management, and fraud detection; and access to capital mar-
kets and investment opportunities. However, in developing countries with a large share of population lacking
financial sophistication, all the aforementioned strengths vanish. Traditional interest rate models do not apply
to low-income customer base; the infrastructure is not cost effective; and unbanked customers are not always
aware (and may not even care) of the bank’s brand.
FINO Bank (India)
MCB Bank (Pakistan)
page 14Innovation Edge April 2012 | MOBILE BANKING
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MNO-LED MODEL
The MNOs offers their large customer base a easy to use financial transaction services with their own distribution
model. MNOs can leverage their customers’ need to buy airtime citizens in developing countries have and facilitate
person to person remittances and bill payments to increase their ARPU (average revenue per user).
G-Cash (Philippines)
M-Pesa (Kenya-Tanzania)
page 15Innovation Edge April 2012 | MOBILE BANKING
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3RD PARTY-LED MODEL
3rd parties, usually technologically driven companies, have strong technology capabilities. However, they lack
the bargaining power over larger banks and MNOs and certainly lacks the capillarity of an MNO’s distribution
network.
Yellow Pepper (LatAm & Caribbean)
Wizzit (South Africa)
page 16Innovation Edge April 2012 | MOBILE BANKING
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Mobile Banking possibly can add to or even transform the retail banking business model by offering anytime, anywhere access to financial products and services. As banks explore the opportunities and benefits, they must be wary of the complications that also come with them.
fullHalfor Half Empty?
page 17Innovation Edge April 2012 | MOBILE BANKING
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When Mobile Banking technologies and
its components are “put together” the
right way, according to the EMFA & McKinsey
report, they can “collectively turn it into a unique
value proposition. … This effectively means that
bank customers can ‘meet’ their bank every
day, albeit remotely. These features plus a flexi-
ble cloud and ‘app’-based technology platform
enables a more rapid development and inte-
gration with third party products.” The benefits
of mobile devices are:
Anytime, anywhere availability
Unique IDs (and their use), specific
to each customer
Simple to use, usually with rich User
Experience
Enablement of Location
Based Services (LBS)
“Go to” devices for consumers
source: EFMA and McKinsey & Co. | The State and Future of Mobile Banking in Europe. October 2011. p. 5.
With the aforementioned benefits of mobile
technologies, banks can offer value proposi-
tions.
Information reporting
Alert messaging
Money transfers
Recurring bill payments
Check deposits
p2p payments
Bank location services
Adding payees through a mobile application
Statements
Administrative functions
Funding cards
Mobile wallet
Personal financial management
Location based merchant offers or coupons
Click to call
NFC or proximity payments
Loyalty rewards
Coupon offers
77%
73%
64%
58%
55%
46%
40%
35%
34%
34%
28%
27%
25%
20%
18%
17%
15%
12%
Some of the offers will result in the creation of new value propositions for customers
Percentage of banks currently offering these features:
page 18Innovation Edge April 2012 | MOBILE BANKING
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RISKSLike all good things in life, success seems to come hand in hand with challenges and Mobile Banking is no exception. Ac-cording to a recent survey conducted by KPMG regarding mobile banking us-age; security, technology adoption, cost, and regulation are the biggest chal-lenges faced by mobile banking. The first two challenges are related to con-sumer concerns and the latter two chal-lenges are provider related concerns.source: KPMG | Monetizing mobile: How banks are preserving their
place in the payment value chain. July 2011. p. 11.
page 19Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
Customer related concerns “is it safe?”
Security is the number one risk for banks and
is also a key barrier for consumer adoption.
It’s been noted by some industry observers
that the EFMA & McKinsey report fails to
mention security (at all). Nonetheless, both
mobile banking providers and customers
clearly place it at the top of the list. Mary Mo-
nahan, adirector at Javelin Research, also ad-
dresses the concern for security. She states,
“The main reason consumers don’t move to
mobile banking is because of security con-
cerns, … Consumers want to know that their
mobile interactions and transactions are en-
crypted, and they want some assurance that
they will be reimbursed for losses associated
with a mobile-banking breach.”
source: BankInfo Security | Mobile Banking: Consumer Education Needed. November 2011.
Also, customer education or awareness is a key
element for mass-adoption of mobile banking,
both in mature and emerging markets.
Provider related concerns: “Show me the money!!!”
Gartner analyst, David Furlonger, during the
Banktech Summit in Sydney wrapped a cold,
wet towel around the warm fuzziness of mo-
bile banking, stating that most mobile banking
applications are used to check balances, rath-
er than making payments (globally): “Nearly
all the interactions on mobile so far have been
checking balances, … “That doesn’t sound like a
way to make money. ”Adding to this, regulation/
legislation is also perceived to shrink margins,
making mobile banking a bitter pill to swallow.
source: ITNews | Gartner casts shad-ows on mobile banking. July 2011.
Specifically in developing markets, banks
need to also understand ecosystems and
manage it well to leverage the mobile bank-
ing opportunities. Given this, inexperience
and unclear management objectives related
to ecosystems may pose as risks or barriers
for banks, such as not understanding the
importance of agents or the logic of MNOs’
business models.
In addition, especially in transformational mo-
bile banking, MNOs pose a risk in that they
need to find a business model that works. As
mentioned earlier in the mobile technology
overview, while they can be valuable part-
ners for mobile banking, they can place de-
tours ahead by delaying anytime, anywhere
capabilities.
page 20Innovation Edge April 2012 | MOBILE BANKING
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snapshotsthe BBVA
experience
Mobile World
global
What´s going on around the world in mobile banking? Conceptual “pictures” of mobile banking practices are presented, covering 12 countries in 4 continents.
page 21Innovation Edge April 2012 | MOBILE BANKING
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GLOBAL SNAPSHOTS
Mobile World
ACTIVOBANK (PORTUGAL) AND MILLENIUM BCP (POLLAND)
Recognized as the Best Mobile Bank-
ing in Europe award by Global Fi-
nance Magazine, ActivoBank and Mil-
lenium BCP mobile banking solutions
are available via a native app for the
Android and iOS devices, as well as
a light browser application for other
phones. The mobile banking solution
offers customers standard banking
solutions, such as account balance
and activity, payments, and card man-
agement. Additionally, the app offers
branch and ATM location information,
FX rates, information regarding up-
coming payments, simplified activa-
tion, application update information,
and other customer centric features.
SCOTIABANK (CANADA)
ScotiaBank is Canada’s most international bank, with global pres-
ence across the Caribbian, Central America, Latin America, and
Asia. ScotiaBank offers “triple play” mobile banking solutions:
“App Mobile Banking” allows customers to check accounts
(personal, small business, borrowing and investing), transfer
funds between Scotiabank accounts, pay bills, send and receive
e-Transfers, send Western Union money transfers, and find
nearby branch or ATM on smartphones (iOS and Android)
“Browser Mobile Banking” allows customers to check per-
sonal and small business accounts, pay bills, transfer funds
between Scotiabank accounts, pay bills, send and receive
e-Transfers, send Western Union money transfers, and
find nearby branch or ATM on WAP enabled phones.
“Text Mobile Banking” allows customers check account bal-
ances, view the last 5 transactions, and view credit card informa-
tion (available credit, minimum payment, and due date) via SMS.
page 22Innovation Edge April 2012 | MOBILE BANKING
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CITI MOBILE – CITIBANK
Citibank’s portfolio of Mobile & Tablet Banking so-
lutions is comprised of “Citi Text” (SMS), “Citi Mo-
bile for Smartphones” (Mobile Browser), “Citi Mo-
bile Apps” (Custom Applications), and “Citi Tablet
Apps (Custom Applications); essentially, a triple
play. Citi’s solutions support iPod, iPhone, iPad,
Android devices, and Kindle Fire. Mobile banking
solutions include from making account balance
inquiries, transaction history, pay bills and track
payments, deposit checks (RDC), see recent activi-
ties, transfer money between accounts, perform
p2p payments, and track rewards programs.
CHASE MOBILE (JP MORGAN CHASE)
Chase offers the complete combo: text, browser,
and app based mobile banking solutions. The app
offers the most functionalities; as it enables custom-
ers to check account balances and transaction
history, pay bills and credit cards, transfer money
between accounts, make p2p payments, and de-
posit checks remotely (RDC). Chase supports the
iOS, Android, Kindle Fire, and Blackberry mobile
operating systems. Furthermore, the app offers
a comprehensive contact directory (with auto-
dial) and search for the nearest branch or ATM.
GLOBAL SNAPSHOTS
Mobile World
page 23Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
BANK OF AMERICA
As early as 2007, Bank of America (BofA) launched its
first mobile banking services. Today, there are more than
9.5 million customers actively using mobile banking solu-
tions; which includes a mobile website, text banking, and
native apps. Currently, BofA offers native apps for the
iPhone, iPod Touch, iPad, Blackberry, Android, Windows
Smartphones, and (most recently) Kindle Fire operating
systems (OS). Regardless of the OS, the BofA’s mobile
banking apps offers the same functionality, including ac-
count overviews, bill pay, and fund transfers. According to
BofA’s mobile channel executive, “customers can expect
additional features for its mobile apps in the coming year.”
ICBC (CHINA)
ICBC is the winner of two AppStore awards in China:
Best iPhone Financial App of the Year and Best iPad
Financial App of the Year. Aside from the standard fea-
tures, such as account management, money transfer,
and mobile phone recharge; it also offers value-added
features, including foreign exchange, securities trading,
investment funds services (it even makes recommenda-
tions!!!), and allows users to buy and sell precious metals.
GLOBAL SNAPSHOTS
Mobile World
page 24Innovation Edge April 2012 | MOBILE BANKING
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Transformative bank-led models
FINO (INDIA)
FINO is an Financial Inclusion Solutions and Services company;
which is promoted by public and private sector banks (including
the ICICI Bank), insurance companies, and the International Finance
Corporation. They are headquartered in Mumbai, India. FINO has
two main lines of business: Technology products and business cor-
respondence services. As a technology provider, the company of-
fers solutions which enable financial inclusion, micro-finance, and
remittances. As a business correspondence services company,
FINO offers its agent network to perform the “last mile” services for
financial services companies.
FINO employs over 2,500 employess and has a solid agent net-
work (which is 20,000 strong), spread across 239 offices. The
agents are equipped with GPRS enabled handheld biometric
authentication which reads the customers’ smart card informa-
tion. By offering “doorstep” banking and other financial services
with cost-effective transactional costs, FINO is currently serving
35 million customers across 24 states. The company purports
that their customer acquisition rate is around 50,000 per day.
GLOBAL SNAPSHOTS
Mobile World
page 25Innovation Edge April 2012 | MOBILE BANKING
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Transformative bank-led models
GLOBAL SNAPSHOTS
Mobile World
MCBANK (PAKISTAN)
MCB Mobile was launched in 2009, which was a joint collabora-
tion between MCB Bank Limited and Fundamo. MCB Mobile was
a pioneer by delivering a cost-effective banking solution outside
of their branch footprint area. MCB Mobile offers banking ser-
vices to the underbanked and unbanked consumers who gen-
erally have mobile phones. Customers of MCB Mobile can view
account balances, transaction history, pay bills, make payments,
transfer funds between accounts, “top off” mobile phones.
page 26Innovation Edge April 2012 | MOBILE BANKING
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Transformative MNO-led models
GLOBAL SNAPSHOTS
Mobile World
Swipe to see more
M-PESA (KENIA-TANZANIA)
Developed by Vodafone and deployed by their affiliate, Safari-
com, in Kenya; m-Pesa has been a Cinderella success story for
“transformative” mobile banking led by an MNO, surpassing the
14 million customers since its launch in 2007. Not bad for 5
years of work.
M-Pesa offers a wide range of financial services, including view-
ing and managing account(s), paying bills, making payments,
buying airtime, making deposits and withdraws (branchless
banking), and transferring funds. Additionally, M-Pesa also al-
lows customer to buy tickets (m-ticketing) and pay school fees.
All of the features of M-Pesa is made available via a featured
phone.
page 27Innovation Edge April 2012 | MOBILE BANKING
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Transformative MNO-led models
GLOBAL SNAPSHOTS
Mobile World
Swipe to see more
G-CASH (PHILIPPINES)
An internationally acclaimed micro payment service, G-Cash of-
fers banking services via SMS. G-Cash customers can transfer
money, pay bills, buy airtime, and make payments via a network
of government agencies, utility companies, cooperatives, insur-
ance companies, remittance companies, universities, and com-
mercial establishments. Also, G-Cash customers can access the
service via basic mobile phones or the internet.
page 28Innovation Edge April 2012 | MOBILE BANKING
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Transformative 3rd party-led
models
GLOBAL SNAPSHOTS
Mobile World
Swipe to see more
YELLOW BANK
Founded in 2004, the Miami-based Company is the recipient of
the first IFC (World Bank) equity investment in a mobile financial
network company in the Americas. With 3.6 million unique us-
ers in nine countries, processing over 18 million monthly trans-
actions, the firm has been selected by more than 40 banks and
strategic partners in the region.
Yellow Pepper’s most promising product is its mobile wallet, an
innovative bank account that the user manages via simple text
messages from their mobile phone, never having to set foot on
a bank branch. According to Fast Company the company in Hai-
ti had over 110,000 wallets with Digicel, a mobile phone carrier
that owns 32 networks from the Caribbean to the Pacific with
over 11 million customers and Scotia Bank Haiti. With the fast
growth of the service mobile wallets could number in the mil-
lions as the service is expanded to other parts of Latin America
providing much needed financial inclusion to the bottom of the
pyramid.
page 29Innovation Edge April 2012 | MOBILE BANKING
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Transformative 3rd party-led
models
GLOBAL SNAPSHOTS
Mobile World
Swipe to see more
WIZZIT (SOUTH AFRICA)
Wizzit offers a secure and efficient payment mechanism to the
unbanked and underbanked consumers in South Africa. The
company offers mobile transactional services via a featured
phone (and now online). The services allows customers to
make p2p transfers, buy airtime, pay bills, make payments, and
offers a Maestro debit card. Wizzit was conceived in 2002 and
launched in 2005. Along the way, the company had to discover
customer needs, while making it affordable, and secure a bank
partner, a pretty impressive feat when considering that it is one
of “new to the world” innovation (no instructions were included).
page 30Innovation Edge April 2012 | MOBILE BANKING
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Mobile Banking Technology
Platforms Providers
Generally, banks have limited choice when
deploying mobile banking technologies: DIY
(Do It Yourself), Off the Shelf Products, or a mix
of the two. Below, leading providers of OTS
FUNDAMO
South Africa-based Fundamo, acquired by Visa in
June 2011, is a leading platform provider of mobile
financial services for mobile network operators
and financial institutions in developing economies.
Fundamo has more than 50 active mobile financial
services deployments across more than 40 coun-
tries, including 27 countries in Africa, Asia and the
Middle East. Fundamo’s deployments currently have
a base of more than five million registered subscrib-
ers and the potential to reach more than 180 mil-
lion consumers with mobile financial services.
The Fundamo Enterprise Edition mobile services
platform includes Mobile Banking (which delivers
Additive Banking and is typically for financial institu-
tions wishing to provide mobile banking as an addi-
tional electronic channel to access existing accounts)
and Mobile Wallet (which delivers Transformational
Banking, typically for mobile network operators
and financial institutions who want to address new
market segments with a differentiated offering).
page 31Innovation Edge April 2012 | MOBILE BANKING
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FINACLE (INFOSYS)
Finacle solutions address the core banking, e-
banking, mobile banking, Islamic banking, treasury,
wealth management and CRM requirements of
retail, corporate and universal banks worldwide.
Finacle mobile banking solution provides bank-
ing services through SMS, GPRS/ 3G and USSD-
enabled handsets, leveraging a single platform.
The Mobile Banking and Payments module includes
account management, deposits, funds transfer, bill
payment, remote deposit capture, Forex, cheque
management, ATM/ Branch locator, remittances,
peer-to-peer payments, business-to-business pay-
ments and contactless payments. The Mobile Fi-
nancial Management module adds analysis tools,
transaction tagging and product comparators. Value
added services include mobile commerce, mobile
ticketing, mobile top-up for prepaid card, mobile
advertising, mobile remittances to charity causes,
mobile wallet, stock trading services, and mobile
virtual financial advisory through video chat.
MONITISE
Monitise plc is a British technology company de-
livering mobile banking, payments and commerce
solutions. As well as partnerships with most UK
high street banks, Monitise provides services to
over 250 financial institutions in the United States,
has more than 6 million users worldwide, with live
services in the UK, the US, India and Africa, and
has a global partnership with Visa Inc to deliver
its services to more than 1.9 billion card-holders.
Monitise’s flagship product, Mobile Banking, enables
a wide range of services including bank and credit
card management, mobile top ups, transfers and
payments. In addition, savings and lending prod-
ucts can also be managed. It allows a variety of
customer-configurable alerts, delivered either via
SMS or smartphone ‘push’ notifications. It can also
act as a secure interactive ‘CRM’ channel between
the bank and their customers, enabling service and
sales opportunities such as card activation, lost/
stolen card management and personalized offers.
page 32Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
GLOBAL SNAPSHOTSThe BBVA
experience
Amongst mobile banking pundits, custom-built native apps are the holy grail, which allows banks to leverage the unique properties of each device to provide the highest level of personalized, customer experience without having to depend on 3rd party providers. BBVA’s award winning mobile banking apps enables anytime, anywhere banking for our customers, making a perfect fit with our Customer Centric Bank (CCB) framework: either as part of an integrated multi-channel strategy (Additive banking: One of Many) or as part of a branchless banking strategy (Transformative: One and Only).
See the screenshots in the next pages
iPhone Android BlackBerryWindows phone 7 iPad
page 33Innovation Edge April 2012 | MOBILE BANKING
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GLOBAL SNAPSHOTSThe BBVA
experience
iPad
page 34Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
GLOBAL SNAPSHOTSThe BBVA
experience
iPad
page 35Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
GLOBAL SNAPSHOTSThe BBVA
experience
iPad
page 36Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
GLOBAL SNAPSHOTSThe BBVA
experience
iPad
page 37Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
GLOBAL SNAPSHOTSThe BBVA
experience
iPhone
page 38Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
GLOBAL SNAPSHOTSThe BBVA
experience
Android
page 39Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
Windows phone 7
page 40Innovation Edge April 2012 | MOBILE BANKING
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Blackberry
page 41Innovation Edge April 2012 | MOBILE BANKING
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“Practice makes perfect,” so the saying goes;
and BBVA has been rather busy perfecting its
mobile banking solutions. Backed by the CCB
framework, BBVA provides customized native
apps for all major OS platforms for its custom-
ers in developed markets.
In the US, the market for mobile banking is
fiercely competitive. In order to position our-
selves as market leaders, BBVA aggressively
pursued a strategy that provided the high-
est quality native apps for mobile devices,
including smartphones and tablets (iPhones,
Android devices, Blackberry, Windows Phone
7, iPhone, and the Blackberry Playbook). With
the apps, customers can find see account
information, RDC (remote deposit capture),
check accounts in real-time, make transfers,
and pay bills. Please visit the “Trending Is-
sues” section of this month’s issue of Innova-
tion Edge to see another BBVA first: opening
an account with an app!!!
In Spain and Portugal, BBVA went from “zero”
to “hero” in no time. Prior to February 2011,
we had 0 (zero) native apps for mobile bank-
ing and, just one year later, we now offer na-
tive mobile banking apps for 4 different OS
platforms: iPhone, iPad, Android, and Black-
berry (with Microsoft Windows Mobile in the
works). Yes, a hero.
RECENT & FUTURE DEVELOPMENTS
Along the way, BBVA picked many “kudos”
from users and we were awarded the “App
of the Week” honor for the week of Novem-
ber 3, 2011 in Apple’s App Store (Spain & Por-
tugal). Also, BBVA published a geo-location
app for the iPhone and Android OS, which
helps customers to find the nearest branch
or an ATM.
In Chile, Contigo BBVA app supports local
commerce deals: retail partners can use
the app to promote specific campaigns, re-
deem coupons, and offer proximity based
advertising.
For the future, the BBVA Mobility Office is de-
veloping other mobile banking functionalities,
such as the integration of fidelity cards, e-cou-
pons, and NFC payments, allowing BBVA to
offer new value propositions through the mo-
bile channel.
While most of our headlines related to mobile
banking deal with the “Additive: One of Many”
concepts, BBVA has also made contributions
to “Transformative: One and Only” innova-
tions. In Mexico, BBVA Bancomer introduced
“Cuenta Móvil Express” which utilizes the
mobile phone number as the bank account
number. Only proper identification is needed
page 42Innovation Edge April 2012 | MOBILE BANKING
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to open an account. Due to its simplicity and
practicalness, the launch of the product has
been a resounding success (especially with
the local media). In Peru, BBVA Continental
launched native apps for the iPad and Black-
berry in April 2011. Subsequently, a new ap-
plication was released to the market which
further extends mobile banking capabilities.
The launch of the pioneer service in Peru was
received very well. There are other initiatives
in Chile (“Contigo Chile”) and Argentina (BBVA
Banco Francés) where the group introduced
a location based offers where customers can
find the best local deals.
BBVA has also published a geo-location app for the iPhone and Android platforms that allows customers to find the nearest branch or ATM.
page 43Innovation Edge April 2012 | MOBILE BANKING
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Forecasting forInnovation
BBVA is ready for the Mobile Banking (R)evolution and we are leading the way. The Customer Centric Bank (CCB) offers the overall framework of the business model in which Mobile Banking makes a perfect fit. For retail customers, our award winning Mobile Banking solutions offer BBVA customers anytime, anywhere banking; paves the way for personalized location based offers; and opens up possibilities for branchless banking, especially for customers in “out of footprint” markets.
As we seen, Mobile Banking is fast becom-
ing key component in a highly complex
and competitive retail banking environment:
not only can it increase banks’ efficiency, it
can also help banks create new value. As
such, Mobile Banking should be an integral
part of every bank’s retail banking business
model. To sum things up, we’ll start by re-
ferring to the recent EFMA/McKinsey report,
“The current state and future of mobile bank-
ing in Europe” (2011):
Mobile has the potential to revolution-
ize the customer experience in personal
financial services, with non-bank organiza-
tions often leading the way.
Banks expect mobile banking to trans-
form the retail banking landscape, but ad-
mit that they are not acting or investing ac-
cordingly.
page 44Innovation Edge April 2012 | MOBILE BANKING
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The unique characteristics of the mo-
bile device present three distinct areas for
proposition’ and marketing innovation: ul-
tra convenient banking, digital commerce
and the opening up of new markets and
segments.
The opportunities will create significant
scope for individual players to win (and
lose) market share – but the overall impact
on banking value creation will be at best
neutral.
Banks must shape, lead, or follow the mar-
ket, they will only succeed if they make a
conscious choice on which strategy to pur-
sue and take concrete action accordingly.
source: EFMA and McKinsey & Co. | The State and Future of Mobile Banking in Europe. October 2011. p.1.
So … few opportunities and many challenges
lie ahead for banks as they grapple with Mo-
bile Banking. Given the highly competitive dy-
namics of the market, no one can blame the
banks as they play the “wait-and-see” game
and seek to position themselves to be in the
“leader” group without assuming too much
risk. However, while the banks are busy neu-
tralizing incremental advantages amongst
themselves, new competitors are entering
the market with new business models that
create and capture value with Mobile Bank-
ing. What do you do when competitors com-
pete with business models? Mobile Banking
is transforming the retail banking landscape,
all at once.
Transformative Mobile Banking
Transformative mobile banking, in general, is offered to the unbanked population in rural areas of develop-
ing countries. As such, it is related to the financial inclusion of the “bottom of the pyramid” segment of the
world’s population. Thus far, very few initiatives have successful (in Africa and Asia-Pacific). However, the
successes are credited to very specific attributes and may not be “translated” well into other areas, such
as South America. However, there are some key considerations that might be worth considering:
Banks and Mobile Network Operators must work together as partners.
Distribution networks must include external agents, who provide footprint and sig-
nificantly reduce costs of operating and maintaining distribution.
Educating and offering support to agents are critical success factors.
Country specific regulatory concerns must be adequately addressed. In some re-
gions of the world, the rules of the game are not always clear.
3rd party technology providers may greatly speed up the rollout of mobile banking solutions.
page 45Innovation Edge April 2012 | MOBILE BANKING
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In depthA list of links to other useful tools and resources that you may find useful as a supplement to the information offered on the ‘Simple Bank’ report.
Books & publicationsBankable Frontier Associates , World Bank - Consultative Group to Assist the Poor (CGAP) | Branchless and Mobile Banking
Solutions for the Poor: A Survey. January 2011.
Centro de Innovación BBVA | Innovation Edge 1. January 2012.
EFMA and McKinsey & Co. | The State and Future of Mobile Banking in Europe. October 2011.
Federal Reserve Board of Philadelphia (Julia Cheney) | An Examination of Mobile Banking and Mobile Payments:
Building Adoption as Experience Goods?
IDC | Business Strategy: 2011 Consumer Preferences Survey Results - Focus on Mobile Banking. January 2012.
Ignacio Mas and Colin Mayer (Said Business School) | Savings as Forward Payments: Innovations on Mobile Money
Platforms. September 2011.
Javelin Research | 2012 Mobile Banking Vendor Scorecard: Mobile Banking Has Moved from a “Nice-to-Have” to a “Must
Have” Channel. 2011.
Juniper Research | White Paper: Banking on the Mobile. January 2009.
KPMG | Monetizing mobile: How banks are preserving their place in the payment value chain. July 2011.
Market Research | Mobile Banking: State of the Market and Future Opportunities. November 2011.
Online Banking Report | Online & Mobile Banking Forecast: 2012 to 2021. January 2012.
Vision Mobile | Mobile Platforms: The Clash of the Ecosystems. November 2011.
Yankee Group | Telefónica Smells the Mobile Banking Coffee. February 2011.
page 46Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
On the webAite Group | Fraud The Latest Threats. February 2012.
Bank Technology News | Banks Seek Sticky Relationships from Mobile Apps. February 2012.
BankInfo Security | Mobile Banking: Consumer Education Needed. November 2011.
BankInfo Security | Mobile Banking: The New Risks. September 2011.
Communities Dominate Brands | Celebrating 30 Years of Mobile Phones, Thank You NTT of Japan. 2009.
GigaOM | The slow rise of the SoMoClo OS. February 2012.
ITNews | Gartner casts shadows on mobile banking. July 2011.
ITU (International Telecommunications Union) | Key Global Telecom Indicators for the World Telecommunication Service
Sector. November 2011.
TNS | Mobile Life: Global Telecoms Insight.
In depth
page 47Innovation Edge April 2012 | MOBILE BANKING
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Trending issues Technology trendsIn the following section, we outline the upcoming technologies that will change everything, with predictions on what may come of them in financial industry.
Summaries of the most relevant news of selected topics that have been published over the course of the month based on its relevance to the Banking industry. The summaries were prepared by the editorial board. Further information is made available for each given topic.
also in this issue
page 48Innovation Edge April 2012 | MOBILE BANKING
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Trending issuesIn this section, readers will find summaries of the most relevant news of selected topics that have been published over the course of the month based on its relevance to the Banking industry. The summa-ries were prepared by the editorial board. Further information is made available for each given topic.
Core banking platformsHere you will find articles related to basic IT infrastructure which supports main banking processes, including technologies such as SOA, WOA, digital platforms, etc.
New formatsBased on design principles focused on customer insights, New formats offers retail banking customers more channels which are more granular and highly functional; a consistent, simple, and collaborative universal user interface; real-time intelligent processes; highly personalized solutions; and is open to social networks and the web. Examples of these new formats are provided here.
Mobile bankingRelevant news about mobile banking platforms (which enable customers to access financial services, such as transfers, bill payments, balance information and investment options) can be found here.
Enterprise 2.0Enterprise 2.0 is the integration of Web 2.0 technologies into business processes. Information regarding implementations of Enterprise 2.0, which generally involves a mix of social software and related collaborative technologies, can be found here.
Mobile paymentsThe process of using a hand-held device to pay for a product or service, either remotely or at a point-of-sale. Up to date information is provided.
Social MediaA group of Internet-based applications that build on the ideological and technologicalfoundations of Web 2.0 that allows the creation and exchange of user-generated content. Enabled by ubiquitously accessible and scalable communication techniques, social media is substantially changing communication between organizations and communities, as well as individuals.
Digital MarketingDigital Marketing of brands use all forms of digital advertising channels to reach consumers, including social media, via a wide range of delivery mechanisms such as mobile phones, sms/ mms, display / banner ads, etc.
Crowd financeA process where small amounts are money raised for a definite purpose, Crowd finance sources funds collectively from individuals. In other words, the money comes from a wide range of individuals and not from a single entity. Read more about it here.
App ecosystemThere are 5 main components in the current Apps Ecosystem: connectivity, devices, OS platforms, app platforms, and apps; along with related products and services providers (MEAPs, Mobility as a Service providers etc.).
New Gizmo eraA combination of Smart Sensors and Robotics will give rise to the New Gizmo Era, ushering in a new age of efficiency and productivity. It is believed that by 2013 there will be a trillion interconnected devices with embedded Smart Sensors, and some with Robotics capabilities.
New banking conceptsBanks around the world continuously explore new approaches to strengthen customer relationships, both in the virtual and the physical worlds; including Virtual assistants, natural language search tools, new marketing tools, different segmentation (children, gen Y,…) etc. This section will cover news along these lines.
Join & enjoyEntertainment is an integral part of our lives. Not only do we want to live longer, but we also want a better, fuller life. In short, we want to enjoy our lives. Access to entertainment will become instantaneous instantaneous, both digitally and globally. Gamification could be one way to foster health education on prevention.Infotainment and social networks are already an established trend, and news abound.
Smart cities + urban mobilityCities are continually growing and urban life is changing. In a Smart City, we find smart infrastructures with plenty of sensors, allowing agents (citizens, governments, and companies) to make better decisions based on real time information. The agents not only use RTI, but also contribute towards it. As a key agent, we will be exploring opportunities. An example of such change is the urban transportation system. The current system is unsustainable, and we foresee a future where we will be able to design a transport that fits the needs of the city and its citizens. This is achieved through changing vehicles physically and using information, integrated as an additional piece of the city transport.
HealthHealthcare systems around the world will certainly go through a profound transformation. Financial pressures, along demographics and citizen expectations, will demand massive adoption of new technologies to maximize efficiencies and create new value. Read about it here,
page 49Innovation Edge April 2012 | MOBILE BANKING
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Trending issues
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Mobile banking
Enterprise 2.0
Mobile payments
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Digital Marketing
Crowd finance
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New Gizmo era
New banking concepts
Join & enjoy
Smart cities + urban mobility
Health
An iBank App Store?!?!
The concept of the app store will revolutionize core banking solutions, according to Don Free, a Research Director at Gartner. “Using an app store approach, you can break down the core banking system into smaller parts and drive significant innovations for the business. The app store approach allows you to access components without developing them. You can now change business processes without involving IT.” With the growing popularity of handheld computing, this approach may help banks find new revenue streams without straying too much away from core competencies.
source: Don Free (Research Director) Gartner | February 2012
page 50Innovation Edge April 2012 | MOBILE BANKING
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Trending issues
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“Branch Today, Gone Tomorrow: The Case for the Death of Branch Banking”
King sure knows how to share his ideas clearly and boldly: all bank branches will die (soon), “Stop arguing that the branch is still critical to the average customer. Realize it is just one channel for them to choose from, and increasingly of minor importance in their day-to-day banking relationship.” According to King, by 2015 the primary channel for day to day retail banking will be (in order of usage): Mobile, Web, ATM, Call Centers and Branches
source: Brett King, “Branch Today, Gone Tomorrow” | January 2012
page 51Innovation Edge April 2012 | MOBILE BANKING
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Trending issues
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New Gizmo era
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Health
Solving the Gen Y puzzle: BBVA Compass First to Allow Mobile Enrollment from an iPhone
Younger customers are going straight to mobile and they are bypassing online banking altogether. In a groundbreaking move, BBVA Compass’s new app allows customers to open a mobile banking account directly from their iPhone; providing a truly anytime, anywhere banking experience for customers. According to Alejandro Carriles, Executive VP and Director of Mobile and Online Strategies of BBVA Compass, “we think we’re creating a groundbreaking user experience.” At BBVA, mobile banking is not only an effective customer touchpoint but also a complete channel; accompanying clients during the each channel phase: awareness, evaluation, purchase, delivery, and after sales.
Source: Bank Technology News - American Banker | March 5, 2012
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Trending issues
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Mobile banking
Enterprise 2.0
Mobile payments
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Crowd finance
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New banking concepts
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Health
Be Social or Die!
The lifespan of organizations today, according Dachis (a social business), is about 15 years. Social business drives adaptation by solving real business problems; by offering a more effective way of “doing talent management, supply chain collaboration, business agility, risk management, and more successful products to driving revenue.” During a recent summit, a social business expert shared his success factors for social:
Listen, analyze, and engage, continuously
Integrate social into the flow of work
Plan for change and the unexpected
Turn on the network effect
Remove barriers to participate
Enable everyone to participate.
Source: Forbes | March 8, 2012
page 53Innovation Edge April 2012 | MOBILE BANKING
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Cha-Ching!!! There a whole lot of money in NFC!!!
Can you say $75 billion US Dollars? That’s the size of the NFC market for mobile payments in 2015, according to Juniper Research. It’s no wonder big players are jumping into the pool for a chance to come out as a serious player in this seemingly lucrative market. Notable NFC projects include Google Wallet, Isis (a carrier-led joint venture between AT&T, T-Mobile and Verizon), and Visa PayWave..
Source: TechCrunch | March 8, 2012
page 54Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
Trending issues
Core banking platform
New formats
Mobile banking
Enterprise 2.0
Mobile payments
Social Media
Digital Marketing
Crowd finance
App ecosystem
New Gizmo era
New banking concepts
Join & enjoy
Smart cities + urban mobility
Health
Move over CNN and make room for YouTube and Vimeo
For adults under the age of 30, social media is clearly the news source of choice, displacing traditional news media outlets. According to Pew Research, there is “striking evidence that young adults and their elders at times have different news agendas and learn about news in different ways. … The Internet was more than three times more important as a news-learning platform for young adults than traditional media such as television, newspapers, and radio.” Since the release of “Kony 2012” video, there have been more than 110 million views on sites such as YouTube and Vimeo. Also, social platforms, especially Twitter and Facebook, played critical roles in diffusing information about the Kony 2012 video.
Source: MSNBC | March 2012
page 55Innovation Edge April 2012 | MOBILE BANKING
Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
Trending issues
core banking platform
New formats
Mobile banking
Enterprise 2.0
Mobile payments
Social Media
Digital Marketing
Crowd finance
App ecosystem
New Gizmo era
New banking concepts
Join & enjoy
Smart cities + urban mobility
Health
When you’re ready to go social, Where do you go?
A recent survey indicates that social media marketing is expected to dominate this year: 81% of CMOs plan to associate revenues to investments in social media. But the question remains, where do you go? To help answer this question, CMO.com turned to 97th Floor, a SEO and social media firm. Here’s the top 10:
flickr
YouTube
Digg
StumbleUpon
Yahoo
Del.icio.us
Source: CMO | February 10, 2012
A social bookmark-ing site used for sharing and storing bookmarked pages
Site is intended for people to bookmark content. You can see what people tag with your brand name, but communica-tion with them is nonexistent.
Not enough ongoing brand rec-ognition to make it worth your while unless you want to be known for providing reference content for later retrieval.
Not as big as it used to be, but informative, massive reference pieces bookmarked for later use can net you a few thousand recurring monthly visitors.
Pretty much everything about the site helps: When your page is bookmarked, it's a direct link back to your site. When you're on the front page of the site, the big category tag pages are full of trust, which will pass directly to your URL.
The community is fickle, and anything perceived as spam will be destroyed. However, look deep into the categorized "subreddits" to unearth small niche communities, and you could get valuable feedback.
Unless you're a bacon company, don't try to build your brand here. You'll end up banned from the site without even realizing what happened.
If Reddit loves you, then traffic is o�en right up there with Digg and StumbleUpon. Be careful: Push too hard for votes from your friends and risk being banned, but don't push at all and you'll wind up with nothing.
Make the front page and many reputable sites will pick up your story, generating valu-able backlinks and extending trust to your site.
A social news community where users post links to the site’s home page
Editor-driven and moderated, so this shouldn't be your primary focus.
Noncommercial sites are heavily favored by moderators, so business sites should not waste time in this uphill battle.
Get in the moderators' good graces, and you have a chance to hit absolutely massive num-bers -- but it's a long shot.
If you make the front page of Yahoo, then you will get a ton of backlinks, but chances are unlikely unless you are a large, established brand.
A social news site where community members can vote on stories
A social news community where members discover and share webpages
Paid StumbleUpon traffic can be a very targeted method of communicating, but whether you're reaching your existing customers is purely random and costly to determine.
A paid campaign can be good for brand awareness, especially following e�orts to get free, organic traffic to your home page. Targeting is very accurate, but keep in mind you're paying 5 cents per visit ($50 CPM).
Enables a diverse range of people to discover your content and share links via the su.pr link shortener on Twitter. Tagging helps, but you don't want the same people repeat-edly giving you a thumbs-up.
Very good if your story makes it to the top page for its tag. StumbledUpon's large user base enables many people to find and link to your stories. For vanity name searches, profile pages rank well, too.
A social news site where users can discover and share content
Not the site's primary strength, though occasionally an objec-tive third-party writeup as a PR e�ort, perhaps to counteract bad press or customer senti-ment, can be promoted.
Opportunities are huge, espe-cially for promoting objective press/blog coverage of your brand. Make sure content doesn't read like an ad, or your site might be banned for being overly commercial.
The grandfather of traffic spikes, so become active in the community or find someone who is. If your site is corporate, then consider launching an industry blog on a noncommercial Web domain to establish yourself as a thought leader.
Very good because even if your story doesn't become popular, then your page will still be indexed quickly. If your story does become popular, this is likely the best site in terms of getting linked to by bloggers.
A video sharing website where users can share and upload new videos
Whether you seek to entertain, inform, or both, video is a powerful channel for quickly engaging your customers, responding to complaints, and demonstrating your social-media savvy.
One of the most powerful brand-ing tools on the Web when you build your channel, promote via high-traffic sites, and brand your videos.
Traffic goes to the videos. If the goal is to get traffic back to your site, then add a hyperlink in the video description, but don't expect traffic to correlate closely with video views.
Very good for building links back to your site because videos rank high. Also a tried-and-true way for your brand to gain exposure.
A social networking site for business professionals
Not the primary focus, but cus-tomer engagement opportuni-ties are possible by answering industry-related questions, establishing yourself as an expert in the field.
E�ective for personal branding and demonstrating your organi-zation's professional prowess. Encouraging employees to maintain complete profiles to strengthen your team's reputa-tion is advisable.
Unlikely to drive any significant traffic to your site, though you never know who those few visits might be from -- perhaps a potential client or customer.
Very high page rank -- almost guaranteed on the first page of search results -- especially for your company name or individual employees' names, but that's about it.
An image and video hosting website where community members can share and comment on media
Unnecessary to spend too much time on this, though properly tagged photosets of company events can help customers put a face on the team behind your brand.
Participation in industry-related groups might get your photos, and thus your brand, viewed by people with similar interests, but numbers will be small.
Even if you get tens of thousands of visits to a photo hyperlinked with your URL, click-through rates are among the lowest around.
Heavily indexed in search engines, passing links and page ranks. Also helps images rank higher in Google Images and in building inbound links.
A social networking site where users can add friend, send messsages and build their own profile
Great for engaging people who like your brand, want to share their opinions, and participate in giveaways and contests.
Facebook brand pages are great for brand exposure. Jump-start your brand exposure through the ad platform, or hire a Face-book consultant to help you grow your brand presence.
Traffic is decent and on the rise thanks to share buttons and counters, but don't expect massive numbers of unique visitors to go to your site.
Little to no value, aside from blogs picking up and featuring your posted links. Not worth the time expenditure.
Use keyword search monitor-ing through a program such as Hootsuite, TwitJump or Radian 6 to track what people are saying about you and your competitors.
A microblogging site that enables users to send ‘tweets’, or messages of 140 characters or less
O�ers unique opportunities for Web site integration and to engage with customers in a viral way, helping your company stand out from the masses.
Potential can be large, but promotion is an art form -- promote your brand too heav-ily and turn o� followers, yet don't promote enough and receive little attention.
Value to your site's SEO is limited, but tweets will rank high in search results -- good for ranking your profile name and breaking news, though shortened URLs are of little benefit.
WEBSITE CUSTOMER COMMUNICATION
BRANDEXPOSURE
TRAFFIC TOYOUR SITE SEO
GOOD! OK. BAD!
THE SOCIAL LANDSCAPE2010 IS THE YEAR CMOS WILL HEAVILY INVEST IN SOCIAL MEDIA. HERE’S A GUIDE TO
HELP YOU UNDERSTAND HOW BEST TO LEVERAGE MAJOR SOCIAL MEDIA SITES.
THE CMO’S GUIDE TO:
page 56Innovation Edge April 2012 | MOBILE BANKING
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Trending issues
Core banking platform
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Mobile banking
Enterprise 2.0
Mobile payments
Social Media
Digital Marketing
Crowd finance
App ecosystem
New Gizmo era
New banking concepts
Join & enjoy
Smart cities + urban mobility
Health
Crowd sourcing goes “plastic”!?!?
MasterCard and Barclays US join forces to create “Barclaycard Ring,” the world’s first crowd-sourced credit card. The duo claims that it marks the herald of a new era in e-commerce and finance: card customers can negociate interest rates, rewards, and fees. The card offers an 8% interest rate with no annual or balance transfer fees. Additionally, the crowd will have visibility into the card’s financial picture, influence management decisions, and have an opportunity to share revenues generated by the card. The Barclaycard Ring will be available to consumers this spring.
Source: Silicon Republic. December 30, 2011
page 57Innovation Edge April 2012 | MOBILE BANKING
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Trending issues
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Mobile banking
Enterprise 2.0
Mobile payments
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Crowd finance
App ecosystem
New Gizmo era
New banking concepts
Join & enjoy
Smart cities + urban mobility
Health
Facebook as an app ecosystem platform provider?
Facebook, during Mobile World Congress, touted their Pay Dialog mobile SDK; which allows “mobile operators to work with app developers to integrate operator billing into their apps.” Facebook already has partnerships with several telecommunications giants, such as AT&T, Deutsche Telecom, Orange, Telefonica, T-Mobile USA, Verizon, Vodafone, KDDI, SoftBank Mobile, etc. All this is part of Facebook’s plan to “push forward its Open Graph, drawing users away from locked-down platforms like iOS and giving them the opportunity to download apps that run freely on the Web and operate on any platform.”
source: The Next Web- Social Media | February 27, 2012
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Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
Trending issues
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Mobile banking
Enterprise 2.0
Mobile payments
Social Media
Digital Marketing
Crowd finance
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New Gizmo era
New banking concepts
Join & enjoy
Smart cities + urban mobility
Health
3 million iPads sold in 3 days
The first iPad took 28 days to sell 1 million units; the 2nd iPad sold 1 million during the first weekend; and the new iPad is off to a strong start: 3 million iPads sold in 3 days. At the flagship store in 5th Avenue (NY), 13,000 units were sold in the first 12 hours! That’s about 1,100 iPads per hour or 18 units per minute. That translates into revenues of $10,700 per minute at that location..
Source: Apple | March 19, 2012 and Motley Fool | March 21, 2012
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Trending issues
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Health
ATM is still going strong (& will get stronger)
ATMs are poised for future growth as there will be more transaction per person, more cash in circulation, and less branches (more ATMs); which would result in more total ATM revenue and profit for the banks. Specifically, according the ATM Future Tretnds Report 2012, by 2015, ATM transactions are expected to grow 66%.
Source: ATM Marketplace | March 1, 2012
page 60Innovation Edge April 2012 | MOBILE BANKING
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Trending issues
Core banking platform
New formats
Mobile banking
Enterprise 2.0
Mobile payments
Social Media
Digital Marketing
Crowd finance
App ecosystem
New Gizmo era
New banking concepts
Join & enjoy
Smart cities + urban mobility
Health
21st century culture: Games as Art
They’ve come a long way from the early days of video games (in the late 1970s), where a rudimentary “two-dimensional ball that (were) batted back and forth” provided hours of fun for time-wasting teens. On March 16, 2012, the Smithsonian American Art Museum inaugurated the “The Art of Video Games,” the first major exhibition dedicated to this new art form. According to the museum’s curator, Chris Melissinos (formerly the Chief Gaming Officer at Sun Microsystems) “I believe it’s society’s duty and responsibility to protect and nurture this medium because it will be the next great medium for expression, thought, poetry and art forgenerations to come. That’s incredibly exciting, and this is just one small step toward that goal.”
Source: BBC | March 16, 2012
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Trending issues
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Mobile banking
Enterprise 2.0
Mobile payments
Social Media
Digital Marketing
Crowd finance
App ecosystem
New Gizmo era
New banking concepts
Join & enjoy
Smart cities + urban mobility
Health
The End of Parking Woes?
It’s the reality of urban life: 33% of the cars on the road are circling around city blocks, much like vultures, hoping to find parking space. Aside from the stress, the situation also adds to city pollution, traffic congestion, and accidents. Future promise: a smart city with networked sensors installed in a city’s infrastructure helping drivers find the parking space, faster and smarter. A pilot project is underway in San Francisco, California which has magnetic sensors installed in street parking spaces, garages, and smart parking meters; the parking information is made available to the public via an app on smartphones.
Source: MIT Technology Review | January 25, 2012
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Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not be reproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
Trending issues
Core banking platform
New formats
Mobile banking
Enterprise 2.0
Mobile payments
Social Media
Digital Marketing
Crowd finance
App ecosystem
New Gizmo era
New banking concepts
Join & enjoy
Smart cities + urban mobility
Health
Socio-Economic Impact of mHealth
Telenor commissioned BCG to analyze the possible socio-economic impact of mHealth. Key findings of the study include:
Everyone (almost everyone) will have access to a mobile infrastructure: 7.4 billion mobile subscriptions projected by 2015.
The technology and bandwidth is sufficient, both simple and smart phones
There are more than 500 mobile health projects being executed globally
Elderly care costs can be reduced by 25% with mobile health projects
Maternal and perinatal mortality can be reduced by 30%
Twice as many rural patients can be reached by a doctor
Tuberculosis treatment compliance can be improved by 30-70%
By 2015, 30% of smartphone users are likely to use “wellness apps”
Data collection and related costs can be reduced by 24%
Among MDs, smartphone is the most popular technology since the stethoscope
Source: BCG/Telenor | February 28, 2012
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The following section outlines the upcoming technologies that will change everything, with predictions on what may come of them in financial industry.
Technology trends
Someone Is Replaying Inside: SIRIThe dream of any artificial intelligence-based application is to under-stand and predict accurately the needs and preferences of the user, transforming intent into actions to perform tasks. Researchers and companies working on personalization technologies have been trying to address this issue for more than ten years. In order to do that, the sys-tem first would have to obtain information about the user, get behavior patterns and learn what will be the next best action that the user would need or would want to do. Sounds good, but we are still quite far from it.
gSo far we have Siri, the digital personal
assistant that Apple has included in its
iPhone 4S launched on fall 2011. Siri performs
actions under user requests, interacting by
using voice recognition and natural language.
It lets the user to ask questions, obtain infor-
mation and perform actions using the native
functionalities of the phone, that is send mails,
make calls, check, schedule and change ap-
pointments in the agenda, etc.
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A LITTLE HISTORY...
Siri appeared as a simple iPhone app in 2010.
At that time there were some other similar but
less advanced apps, like MyBantu or Zokem,
also supposed to be personal assistants and
recommendation services, but they finally
came to nothing. However SIRI was a big thing.
It is based on the DARPA funded SRI research
project CALO (Cognitive Assistant that Learns
and Organizes), the largest Artificial Intelli-
gence project in U.S. history. With $150 million
of DARPA investment, the CALO Project was
focused on helping individuals manage an
extensive amount of task related information
(specifically emails) in an office assistant and
generate actionable tasks for situations such
as forming ad-hoc teams in military scenarios.
When it was an app, it had also more than 30
different partners whose APIs can plug into
when answering a request. These include
services like OpenTable, MovieTickets.com,
Eventful, StubHub, Taxi Magic, Rotten Toma-
tos, Bing, Google Maps and Yelp. Now, as part
of the operational system of the iPhone 4S,
it has acces only to Yelp, Wolfram Alfa, and
Google. However, it is integrated with email,
calls, sms, calendar, it learns from user ac-
tions: it may know for example who is impor-
tant for you without need to tell, based on
your actions with the phone. Siri gets better
the more you use it, learning from the user,
their preferences and their frequent actions,
adapting its response to them.
BUT WHY IS (OR COULD BE) SIRI
SO IMPORTANT?
Because it could be the top of the iceberg of
the future of the devices and its applications
based on AI.
The phone becomes sensor of the users
and their environment: it utilizes information
available on the user’s calendar, email sys-
tem, address book, social network, enhances
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it with geo-location based activity tracking
and information declared explicitly by the
user, and generates context dependent user
profiles. At some point, Siri will have access
to databases and will be able to search and
obtain external information of third parties
to enrich the context, and delegate to other
apps to deliver services and perform tasks.
IN THESE ARE APPLE’S PLANS FOR SIRI,
WHAT IS THE CHALLENGE?
As always, the challenge is the combination
of big-data gathering and its analysis to pre-
dict the activity the user to deliver context
and relevant information, the improvement
of the semantic intent understanding, and
the increase of the capability of apps and
devices to talk to each other and talk back
to the user.
Now Apple has given the first step to de-
liver it to consumers, who’s next, Microsoft?
Google?
page 66Innovation Edge April 2012 | MOBILE BANKING
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Work Smarter, (Not Harder) with Business IntelligenceGartner defines Business Intelligence as, “an umbrella term that includes the applications, infrastructure and tools, and best practices that enable access to and analysis of informa-tion to improve and optimize business deci-sions and performance.”(1) Or simply, it can be expressed as: Information Management + Analytics = Business Intelligence. With Social, Mobile, Cloud, and Big Data coming, companies should really think about BI.
g
The latest information related to Business In-
telligence keeps this macro trend as a priority
for BBVA for the medium term time frame. BI
initiatives can reduce cost, increase the qual-
ity and availability of information and analy-
sis, and help user make better decisions.
Corporate use of BI includes: financial analy-
sis, business activity monitoring, forecasting,
sales tracking, customer relationship man-
agement, operational process optimization,
competitive analysis, corporate governance,
product marketing, risk management, prod-
uct development, and fraud detection. The
Data Warehousing Institute says that using
Your business
Your management
Information technology
Business Intelligence
page 67Innovation Edge April 2012 | MOBILE BANKING
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mobile BI improves customer sales, service
and support in a 65% and increase customer
self-service benefits in 45%.
Despite the challenging environment, BI is
expected to continue to grow during 2012.
International Data Corporation (IDC) states
that “the worldwide business intelligence
tools market generated more than $4 billion
in revenues in the second half of 2010”. Driv-
en my market demands, “the BI platform mar-
ket’s compound annual growth rate (CAGR)
through 2015 is expected to be 8.1%,” accord-
ing to Gartner analyst James Richardson.
The future direction of BI is heading towards
social, mobile, and cloud. For example, the pro-
liferation of tablets and mobile devices will lead
to the development of mobile BI. According to
the market study of, seniors managers using
Dresner Advisory Services mobile BI exceed
82%, and middle managers 55%.
The proliferation of tablets and mobile devices will lead to the development of mobile BI.
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Reyes Bolumar
Fernando Esteve
Antonio García
Eugenio García
Rafael Hernández
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Manolo Moure
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