Innovating and Automating in 2018

By Monica Meinert

Bank CEOs on streamlining and improving the digital customer experience. 

In defining their priorities for 2018, bank CEOs highlighted the need to meet their customers where they prefer to bank, be that on a desktop computer, mobile phone or tablet, according to a new survey conducted by ABA’s Community Bankers Council.

“From a customer standpoint, we continue to see a shift to a more technology-based experience,” says Brian Johnson, CEO of Choice Financial Holdings in Grand Fork, N.D. “While relationships with the customer are still very connected and strong, the transaction of that relationship is often outside the branch.”

With that in mind, many banks are reevaluating their mobile and online strategies, and expanding the range of things customers can do online.

Of the CEOs surveyed, 69 percent said they plan to increase the number of products and services offered over their existing digital channels. Fifty-two percent plan to expand the number of digital channels offered to customers, 64 percent plan to offer online account opening across all digital channels and 35 percent plan to offer mobile wallet to enable customers to pay for purchases.

In Midland, Texas, for example, FirstCapital Bank of Texas offers Popmoney, a person-to-person payments service launched by CashEdge (now part of Fiserv). “Suppose I pay for your lunch tab—$8.33 for your salad and drink,” said Jay Isaacs, the bank’s president. You can go to your phone, make a transfer from your checking account via phone to my phone, and I can download from my phone to my checking account.” The service has proven quite popular with FCB customers, he adds.

In addition to payments, many banks are moving quickly to digitize lending processes.

“Consider a married couple where both are working. It’s difficult for them to find the time to meet with somebody in a branch,” says Bryan Luke, Hawaii National Bank’s president and COO. “It might be 10 o’clock at night when they want to initiate a loan application.”

Hawaii National uses Mortgagebot’s Online Mortgage-Handling Platform—offered by ABA endorsed provider Finastra—to help with home loan originations. The automated system speeds the lending process, providing the bank a competitive advantage.

“When you’re talking about mortgages, the amount of time to close is really important, especially on the housing side in a hot market,” Luke says. “If we can close loans faster than the overall average of 34 days, that’s a competitive advantage for us. That will encourage people to recommend us over someone else, because at the end of the day, from a rate perspective, everyone is pretty competitive, so then it’s about competing on service.”

Fort Morgan, Colo.-based FMS Bank plans to focus on expanding its mobile and online offerings for both loans and deposits in 2018, says president and CEO John Sneed. “People have responded well to our online residential loan application, and we are seeing use across the board.” At present, the digital loan origination document is just a static form, and the bank takes the application process from there. The next step for FMS bank is to upgrade to an interactive experience through a mobile application.

Sneed adds that the bank is also looking to online and mobile for certain checking deposit products and small business loans.

To learn more about the latest in community bank priorities, download the full report.

Monica C. Meinert is associate editor of the ABA Banking Journal and ABA Daily Newsbytes