Category: Business Models

Business Models, US

US finance sector puts Web pricing in crosshairs

Colin Henderson

American banks get serious about the net neutrality bill. Its good to see this move, because the telco's have had a free ride on this highly consequential issue. Its been largely invisible to the public to date.

US finance sector puts Web pricing in crosshairs | Technology | Reuters.co.uk

WASHINGTON (Reuters) – The U.S. financial sector, a powerful force in Washington, may be gearing up to jump into a Capitol Hill fight over the future of the Internet and stop an effort it says could add billions in costs just to maintain current offerings.
…..For the financial services sector, which is expected to spend $117 billion on information technology this year, tiered pricing could add billions more in expenses to maintain online banking services and other Web offerings, according to a memo circulating among financial services lobbyists. Those costs could hit the bottom line or be passed on to customers.

We noted the bill passage in April, and its good to see the American Banks get serious about this issue.

But it's a fight the financial sector almost missed.

"Net neutrality is an issue that (financial services) firms ignore at their peril," Philip Corwin, a partner at Washington law firm Butera & Andrews, wrote in the memo.

"If the industry does not engage quickly, it may find that the matter has been decided without its input and that the fallout will affect the industry's cost structure and customer relations for years to come," he added.

Relevance to Bankwatch: Online banking is fundamental to banks cost structure now.  Changes to the internet access model  which is today based on a  flat rate,  would have significant consequences.

Update:  Additional background from  the inventor of internet – Tim Berners-Lee Continue reading “US finance sector puts Web pricing in crosshairs”

Business Models, US

Checking study: Bank fees still rising

Colin Henderson

Bankrate announce their annual checking study. The results seem somewhat at odds with another study reported recently. This confirms to me that the first thing to look at with any study is the sponsor, and their motivation.

Checking study: Bank fees still rising (Page 1 of 3)

Banking fees, balance requirements for checking accounts and ATM costs continue to rise while interest earnings on checking accounts do not, according to a Bankrate.com survey.

Continue reading “Checking study: Bank fees still rising”

Business Models

More on Zopa – Person to person lending

Colin Henderson

Tony Hallet writes are silicon.com about setting up with Zopa. This is a useful case study to understand the mechanics of how this novel concept works. He is an Egg customer, and is very comfortable with the company and the model.

Will Zopa’s P2P loans mean the death of the bank manager? – Financial Services – Breaking Business and Technology News at silicon.com

Behind Zopa are some of the people who launched Egg, the internet bank. I have been a pretty happy Egg customer for a number of years and some of the trademark marketing attitude shines through at Zopa.

Continue reading “More on Zopa – Person to person lending”

Business Models, Innovation, Web/Tech

How IT Drives Product Proliferation: Keeping Complexity at Bay

Colin Henderson

A new report from George Group/ Wharton is summarised at FinanceTech, by By Matt Reilly & Stephen Wilson, of George Group Consulting.

How IT Drives Product Proliferation: Keeping Complexity at Bay

Competitive pressures are driving the need for more product development. But the industry is plagued by complexity-related issues. Why IT may be part of the problem and why the solution may be less versus more

The key driver all Banks contend with are noted.

Continue reading “How IT Drives Product Proliferation: Keeping Complexity at Bay”

Business Models, Innovation, Payments, Web/Tech

The right questions to ask about payments

Colin Henderson

Digital Money held their forum in London, and the presentations are now online (middle left – presentations – speakers). For more detail on the decks, go to the wiki. Here are insights from the leaders in the new payments space, and Banks must listen, and think about the implications. Its a unique opprtunity to see data on Paypal, and thoughts from emerging leaders including Vodaphone, Mi-Pay, Tesco, and Peppercoin. I noted this page from the Peppercoin deck, which asks a set of higly relevant and strategic questions. Small Payments and mobile based payments Contactless payments, and mobile phone based contactless … Continue reading The right questions to ask about payments

Business Models, Innovation

The glib continium – where the good ideas are repressed

Colin Henderson

This is a fascinating piece from "Creating Passionate Users". Its fascinating because it perfectly articulates how Banks operate. Creating Passionate Users: When only the glib win, we all lose In way too many meetings, the fastest talkers win. And by "fastest talkers", I mean those who are the first to articulate an idea, challenge, issue, whatever. Too many of us assume that if it sounds smart, it probably is, especially when we aren't given the chance to think about it. The problem is, the guy with the "gut feeling"–the one who senses that something's not right, but has no idea … Continue reading The glib continium – where the good ideas are repressed

Business Models

As retail banks struggling with cost of compliance, this has to be turned into an opportunity

Colin Henderson

Regulation and compliance has significantly grown, particulalry following September 11th, 2001. The need to address funding of terrorism, and organised crime, the desire to better protect consumers, and the need to ensure a stable financial system in times of emergency, have driven unprecedented levels of regulation, and compliance activities worldwide.

Finextra: UK retail banks struggling with cost of compliance

Almost a third of UK retail banking and insurance organisations say that industry regulations on documentation are placing additional cost burdens on their business, according to a study released by Thunderhead and Xansa.The survey of 50 banks and insurance firms found that 65% believe the cost of effecting any necessary changes to templates as a result of FSA regulatory changes would be 'very' or 'quite' costly. Only five per cent believed it would not be costly at all.

  Continue reading “As retail banks struggling with cost of compliance, this has to be turned into an opportunity”

Business Models, Security

Banks aiming to alleviate online banking fears

Colin Henderson

Good article at silicon.com on two-factor authentication. All Banks are underway with something in this space at the moment, but the article correctly asks, whether this will be adequate. Of course the answer is no, it will not be adequate. Its essential as the next step but additional steps will be required.

Banks aiming to alleviate online banking fears – Financial Services – Breaking Business and Technology News at silicon.com

Barclays recently announced it is stepping up its fight against fraudsters by using technology to check that each customer's spending behaviour matches his or her profile.

First, lets look at what Banks' are using:

Continue reading “Banks aiming to alleviate online banking fears”

Business Models

Online Banking Report makes predictions for US P2P lending market

Colin Henderson

Payment news reports on the prospects for this new space reported yesterday.  The unique challenges referred to are criminals and con-men, who will undoubtedly attempt to take advantage of these unique offerrings. Payments News: Online Banking Report Studies Prosper.com Person-to-Person Lending – March 28, 2006 Presuming Prosper and/or Zopa make it through these unique challenges, the report predicts that within five years the total market for person-to-person lending in the U.S could surpass 100,000 loans annually, worth more than $1 billion. Continue reading Online Banking Report makes predictions for US P2P lending market

Business Models, Open Source Banking, Payments2 Comments

More on Bankless Banking (Zopa, Ripple, Prosper)

Colin Henderson

As noted earlier in March, based on the article in the Economist, there are moves afoot in the alternative banking space. We noted the appearance of Ripple yesterday. these are new business models, that provide for P2P (person to person) borrowing/ lending, with no Bank involved. Finextra now report, that Zopa from the UK intends to attack the US market, having raised $15M in preparation. This following the launch of Prosper in the US last month. Finextra: Zopa raises $15m for US launch Zopa, a UK-based online person-to-person lending and borrowing exchange, has secured $15 million in series b funding … Continue reading More on Bankless Banking (Zopa, Ripple, Prosper)