Podcast: Jeff Plagge on Zelle, RTP and Implementing New Tech at Community Banks

On the latest episode of the ABA Banking Journal Podcast, Jeff Plagge — president and CEO of Northwest Financial Corp. in Arnolds Park, Iowa, and a former ABA chairman — discusses how a smaller community banking company like his, with $1.8 billion in assets, can make investments to stay on the technological cutting edge.

“People’s perspectives on what is fast continues to change,” says Plagge, whose bank is in the pipeline to implement person-to-person payment app Zelle. “Zelle is now the real-time alternative” for P2P, Plagge says. He adds that the Clearing House’s RTP initiative, on whose advisory board he serves, will offer a similar service for business customers.

“It’s not quite as discussed as Zelle right now,” Plagge says, but “in my perspective, it’s one that banks need to be paying attention to equally or even more so than the P2P space.” A substantial part of banks’ deposit base comes from commercial accounts, and as business customers “experience faster payments personally, they are going to expect to experience faster payments business-wise.”

Plagge explains how he leads implementation of new technology in the bank. (For example, Northwest is also always looking at “better interfaces” on mortgages, consumer loans and small business loans to improve the customer experience.) “We’re an in-house shop,” he says, which “helps you develop how you want to do it as opposed to how it’s being offered.” While it provides more control, it makes it imperative that the bank find in-house tech talent, Plagge adds — which is where Northwest’s footprint in Omaha, Neb., comes in handy, as it can attract talent in a metro market that might not consider the rural Iowa towns where Northwest also operates.

Plagge also discusses how he deals with a legacy regulatory structure while innovating, navigates the Iowa banking scene, motivates employees to embrace change, and spreads the message of banker engagement and advocacy.

If you can’t see the audio player above, click here to listen to this week’s episode.