Last Friday evening, I was fortunate to spend some time at an impromptu Bank 2.0 MeetUp in San Francisco with author and engagement banking pioneer Brett King. Joining us in the conversation about the next generation of banking was Michael Degnan, Engagement Banking Leader for Sapient Nitro’s Financial Services Center of Excellence, as well as Scott Sanborn, the CMO of SF-based Lending Club, which had just closed a $25 million round of new funding earlier in the week.
While I won’t be providing a complete tick tock of our MeetUp in this post, it was great to talk about the future of banking and the shift in technology and customer expectations with some of the more innovative thinkers in the space. It was also nice to meet and talk shop in person after conversing through Twitter. While I am huge proponent of social collaboration and conversation, nothing beats the impromptu dialogue of a conference break out session or panel, and all those side conversations that inevitably occur. I applaud Brett’s efforts to set up MeetUp’s during his business trips, and encourage others to embrace social connections and follow suit.
I really enjoyed talking to Michael Degnan and learning more about Sapient Nitro’s involvement in engagement banking, as well as talking social data. How can a user’s social graph be leveraged to offer enhancements to the customer experience and transaction components for traditional banking channels? What about ways to improve the investing and portfolio management customer experience? We talked about the latter after Brett announced S&P’s credit downgrade of the U.S. government to the group. Talk about a conversation thud – “the most risk-free investment now has risk”. Boom. Now it was some time for some navel gazing and a moment to ponder Monday’s market open and how our portfolios melt away.
Outside of that news-bomb, it was great to get an update on Lending Club, and hear about their recent funding successes. As companies and personal investors look for better returns and diversification (especially in light of recent events), the social lending space will continue to grow (Lending Club added $20M in new loans in June alone). More power to them if the larger banks aren’t as willing to lend and embrace the social aspect of what has been estimated to be at $60B P2P market through family and friend loans. Propser, the other big-player in the space along with Zopa, has received huge rounds of investment of late, including $150M in June, and another $17M from Google’s Eric Schmidt.
Brett’s project list is intriguing as well, including a follow up to his successful book, Bank 2.0, which has been an industry board room topic since it launched last year. I was especially interested in learning more about his mobile-optimized banking startup MovenBank, which has promise to be an important player in the banking landscape. Brett talked about how MovenBank is being designed to remove the friction caused by existing technology and locational constraint that exists between financial institutions and their customers today. I imagine that Brett’s literal napkin diagram of the existing banking structural constraints has been repeated across the jet-setting pace of his past year’s conference schedule. I remarked about my feeling of deja vu after seeing Al Gore deliver his “Inconvenient Truth” presentation with my wife in San Francisco two years before the book and movie came out (though Gavin Newsom and Jerry Brown weren’t seated at the table as they were when we saw Gore) . It makes sense that the author of Bank 2.0 would be designing customer-experience-driven processes to avoid the tension created by existing banking structures, and that is exactly why it’s engaging. There’ll be many of us in the industry secretly rooting for MovenBank.
Whether MovenBank intrigues the larger banking community as much as BankSimple has (or had, at least by the dearth of recent coverage) remains to be seen. I can only hope that Brett’s partners will continue to do something the banking industry sorely needs, and that is to further shake things up to the benefit of the banking customer and for the overall user-experience (which has huge gaps, as you occasionally see in my tweets about online banking, PFM, mobile, and UX). The other purpose of MovenBank, in my opinion, is to inspire further innovation. Companies waving the flag of true innovation are rare in the financial services industry, whether this is due to natural barriers of entry or the conservative nature of bank technologists and their C-level counter-suits. Disruption isn’t just coming, it’s already here (e.g. mobile payment).
We need to create more Bank 2.0 converts and more “engaged bankers” in our industry (maybe by the time Bank “3.0” or whatever Brett calls it comes out, more of the industry will have read his first book). As a reluctant “banker” (I don’t think anyone in banking technology, analytics/data or financial marketing ever really calls themselves a ‘banker’), one has to encourage this type of industry-shaking thinking and technology development however we can (as I covered in a year-end post on American Banker’s BankThink). If not to benefit the customers and industry we serve, but to improve our own user experience as consumers and business owners as well.
What do you think?
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