Published on the 01/05/2014 | Written by Newsdesk
The big banks’ battle to beat each other in the innovation stakes continues with Commonwealth and Westpac now competing over card-free cash withdrawals, while other innovations are blurring the lines between traditional banking and accounting system roles…
Within hours of the Commonwealth Bank announcing plans to release a smartphone app that would allow customers to withdraw cash without using a debit or credit card, Westpac foreshadowed a similar facility by mid-year.
Where CBA’s solution will send two unique codes to a smartphone which can be input at the ATM to allow a withdrawal, Westpac’s clunkier solution relies on customers telephoning the call centre to get a cashcode that can be used at an ATM.
For the biggest banks innovation has become something of an arms race.
Yet it may be paying off as according to a recently released Global Banking Report from PricewaterhouseCooper, Asia Pacific’s banks are now leading the world in terms of their ability to deliver interactive banking experiences for their customers.
Although Asia Pacific’s banks spend less on technology than their US counterparts, they are considerably more innovative and achieving higher returns on technology investments according to the report.
Banks in this region are also far more alert to the long term benefits of a digital relationship with customers. This has translated to more than 60 percent of Asia Pacific bank executives recognising innovation as important to the long-term success of the business, compared to 40 percent of European, and just 28 percent of US, bankers.
The banks aren’t just competing with each other however, but with technology-fuelled start-ups, and with accounting software companies.
Another innovation from Commonwealth Bank is a smartphone application coupled with an encrypted Emmy Eftpos device that will allow small businesses to issue quotes, invoices, track supplies and collect payments. The app blurs the line between accounting systems and payment systems – and although data from the CBA app can be downloaded as a CSV file into an accounting package, for micro businesses the CBA’s app could prove an effective alternative to a conventional accounting system.
Mobile payments is of great interest to the region’s banks – BNZ for example last year released PayClip
using Mint Wireless technology to allow payments to be collected on smartphones or tablets. But the same technical underpinnings support MYOB’s PayDirect solution which has the software company encroaching on what was traditionally bank territory.
CBA CIO Michael Harte acknowledged that banking and accounting were increasingly part of an “ecosystem” in which the bank wished to play a greater role.
UPDATE: Mike Harte has since resigned from his position at CBA to take up a new position as the chief operations and technology officer at Barclays Bank in the UK. During his tenure he led and conclude CBA’s major $1.1 billion core systems overhaul, which was his signature achievement, and which has acted as a firm foundation for the bank’s innovation. The role at Barclay’s is an opportunity for Harte to once again work with a bank on a major transformation initiative. Barclays has since last year been running Project Transform, which relies extensively on technology to improve customer service, boost efficiency and reduce costs. His resignation also marks the end of a broom through the upper echelons of bank technologists with all four of the Big Banks switching CIO in the last six months.
