Three Barriers to Banking Innovation found on The Financial Brand Website and written by Sergio Chalbaud, CEO and Founder of Fintonic, suggests 3 hurdles that hinder innovation in banks: the traditional organizational structure, culture, and a widening technology gap. Hierarchical structures often found in banking can limit creativity, while a culture of risk aversion doesn't allow for exploration of new ideas. It can also be unattractive to the younger generation entering the workforce. New technology needed to link delivery channels is costly and, as Mr. Chalbaud notes, "banks must aggressively attract top technology talent to make new ideas a working reality."
Recently in The Financial Services Club Blog by Chris Skinner @Chris_Skinner, Mr. Skinner published his views on mobile banking, specifically the mobile wallet. Mobile wallet wars? They haven't even begun... discusses the fits and starts that services such as Apple Pay are going through. A major issue is what he refers to as the "comfort zone" where using the mobile device becomes easier than using cash or cards. He also points out an interesting contrast between Apple and others who are finding difficulty with acceptance, and Starbucks, who processed 90% of all mobile payments in the year 2013.
What's a community banker to do?
- Evaluate Data Processing - make sure innovative technology is being developed by your provider or find one that is.
- Expand IT - with people who are educated in new technology particularly the mobile channel and social media. Your new customers will come from a generation familiar with mobile technology.
- Get Organized - it may be hard, but finding creative ideas might require a departure from the traditional banking hierarchy. If that's not practical, Figure out how to glean new, innovative ideas from withing the organization.
I'm Tom Parsons and work for Plansmith Corp. where we help community banks simplify complexity with the use of innovative technology and people. I'm currently enrolled in the Social Marketing Specialization by Northwestern University and offered through Coursera.
I can be contacted through Twitter @tcparsons and LinkedIn https://www.linkedin.com/in/tcparsons I also follow and comment on all things social banking related on Twitter at @imaSocialBanker