Banks invest in technology
Many customers, especially millennials, want ‘new channels’ for taking care of their money chores
BANKS increasingly are meeting their customers in cyberspace.
“They really want to interact with us through these new channels,” said Gavin Michael, head of digital for consumer and community banking at Chase, which ranked No. 1 on the Chronicle’s list of biggest banks as compiled by SNL Financial. Chase had the largest Houston-area market share in 2014 based on deposits.
Last year, the bank redesigned its iPhone and Android apps to make them easier to use. In early June, it announced that customers with the iPhone 5s or newer can use fingerprints to log in to its app. More than 20 million customers use its apps nationwide.
In its branches, Chase has new ATMsthat offer more selfservice. These ATMshave up to $3,000 cash limits and allow users to withdraw money in a variety of denominations. It’s rolling out this technology in the Houston area, and soon 55 banks will have the upgraded machines.
The bank is also upping security through chip-based cards, which have an embedded chip that produces a single-use code to validate transactions. This makes it more difficult to steal and counterfeit information. By the end of 2015, more than 70 percent of the bank’s credit and debit cards will have this chip.
Also embracing new payment technologies is Prosperity Bank. Like many banks, it recently launched Apple Pay for its customers.
“It is safer, and a lot of consumers like to have that type of technology,” said Gisela Riggan, chief information officer.
Prosperity, ranked No. 7 on the Chronicle list, is also working on technology to attract and retain millennials, who want banking and money movement to be quick and easy.
Chris Williston, president and CEOof the Independent Bankers Association of Texas, said technology is one of the more expensive propositions for small community banks. Yet they’re investing heavily.
“They know they have to,” he said. “It’s not one of these deals where you can be late to the market.”
It can also be an equalizer. Banks that don’t have massive branch networks can use technology to reach more customers without investing in these brick and mortar locations.
Cadence Bank, No. 11 on the list, is using interactive teller machines partly for that reason: to expand its reach without the cost of building branches, said Dann Lee, director of retail delivery for Cadence.
This machine uses Skypelike technology to summon a teller from a call center in Starkville, Miss. The teller can help customers make deposits, cash checks, withdraw money, make loan payments and transfer
money between accounts.
Cadence has used this technology in Alabama and Mississippi for about a year and a half, and it recently opened an interactive teller machine at a branch in The Woodlands. Customers can reach virtual tellers from 7 a.m. to 7 p.m. Monday through Friday and 8 a.m. to noon on Saturday.
The bank also enhanced its mobile and online banking earlier this year. With Cadence TotalMoney, customers can track their budgets and expenses. It’s designed to help customers make better money decisions.
“We’re not just here to be a transaction partner,” said Tom Clark, chief information officer for Cadence.
Jeff Dennes, chief digital banking officer at BBVA Compass, said technology can help customers feel more in control of their money. Mobile alerts for account balances can prevent overdraft fees, and apps can provide real-time account information.
BBVACompass, No. 4 on the Chronicle’s list, has invested in apps and video banking, similar to the interactive teller machine at Cadence but available 24/7. In addition, the bank buys or partners with a variety of technology companies focused on financial services.
“Technology is now just a natural part of the DNAof banks,” Dennes said.