Brett King

Customers will never use Facebook to login to their bank!

In Engagement Banking, Future of Banking, Groundswell, Mobile Payments, Social Networking, Twitter on December 7, 2011 at 07:16

We’re experiencing a massive shift in consumer behavior right now with the explosion of Facebook, Twitter, YouTube, and other community collaboration and social media platforms. A world where Facebook has 800 million inhabitants and a President who is a college dropout (albeit Harvard).

We’re seeing the global domination of mobile across the entire world, where before long every person on the planet will have a mobile phone – and soon that phone will be a wallet. Smartphone owners will be the majority in just a few years as smartphones are virtually free on contract, and unlimited data is bundled free. Already the average smartphone user spends more time using Apps than they do using an Internet browser on their computer.

The traditional players amongst us say that such things don’t really change the fundamentals, that “it will take time for people to trust these new mechanisms”.

I’ll never login with Facebook to my bank.

I won’t pay with my mobile phone unless I understand how secure it is. This NFC technology is too new and there’s no common standard.

Huh?

The same people who said this probably said…

I’ll never use email, there’s nothing like calling someone or a face-to-face discussion to solve a problem

I’ll never use an ATM machine, I don’t trust a machine to give me money.

I’ll never get a cell phone – I don’t want people to be able to call me whenever and wherever I am.

I will never put my credit card details on a website online – are you crazy?

I’ll never bank online. Not in my lifetime…

I’ll never need a Facebook account – it’s a waste of time, it’s just for college students.

Really?

If you are saying you won’t do something that millions of other people are already doing, that’s a sure sign that it’s going to disrupt the hell out of your business and you’re in trouble.

If you’re not planning to work differently, if you’re not thinking differently, then you’re just out of touch, you’re just one step away from irrelevance. You’re fighting the flow upstream and getting pushed towards disaster.

The one constant of the internet-enabled world is that you have to be ready to change constantly. Resistence is not only futile, it’s stupid and very costly in the long run. It’s cheap and easy to be social right now, same for mobile – it won’t be in the future.

Right now you have two choices.

Start experimenting with how to adapt to these new methods

Start figuring out what people want to talk about on social media. When they’re using their phones at a store, for searching on products, when they check-in, tweet or update their facebook status.

Start talking to them. Start sharing content that isn’t marketing messages pushed down their throat, but helps them.

Start trusting consumers to talk to you about your brand, your products and about what they want from their bank or services provider. Understand you can’t control the conversation, but you can and should participate in it.

Open up new products and services based on social media. Get consumers to give voice to their needs and help you form those ideas. OCBC, DBS, First Direct, ASB, Comm Bank are all trying different types of crowdsourcing to develop better relationships with their customer base.

OR… Ignore the obvious, get ready to be displaced

Our customers don’t feel safe using Facebook for login!

But some of them might… how long before most of them will? How do you meet your KYC requirements and keep customers safe when allowing them to do this? Are you going to wait till everyone else is doing it, or are you going to learn how to do it properly and securely now. Are you asking your compliance teams to find ways of figuring out how to do this stuff safely?

It will take years for the mobile wallet and NFC to take off!

Right now Google and Apple are eating your lunch and you don’t even know it. You are getting ready to write off the one device that is most critical for connections and context with your customers in the later part of this decade. Someone else is going to own your customers, and as banks we’re going to be paying the likes of Google to include our branded card in their wallet, or our products and services and messages on their platform.

We already have to ask permission from Google and Apple to give our customers our App.

Don’t want to change! You will…

The fact is most of the last two decades we’ve been facing constant change, and no one organization has been able to resist the shift because customers decide how and when you’ll engage with them.

Customers have already decided they want their mobile device to be their bank. They’ve already decided that they want to discuss your brand and your service capability in the open community of social media.

Now it’s time for you to decide that you want to stay relevant to your customers. Or ignore the obvious and go away.

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  1. Ok, so there’s a tidal surge behind Facebook, but is weight of numbers your only argument? There is a crucial and hitherto insurmountable obstacle to logging on to a bank using Facebook: nobody has yet figured out how to federate identities and allocate liability.

    It’s not for want of trying. The idea of Federated Identity — or equivalently, universal electronic “passports” like general purpose digital certificates — is older than e-commerce. Well heeled initiatives like Liberty Alliance, Cardspace, and the Australian banking sector’s Trust Centre have all failed on the launch pad. It’s because the business ecosystem is made up of diverse niches that have evolved their own ways of managing risk. The efforts of technologists to make IDs interoperate across niches (usually referred to cynically as “silos”) overlook the innate conservatism of highly evolved business rules.

    If banks cannot federate identities amongst themselves where they all play by the same regulated rules, what hope does Facebook have of breaking in? What promises can Facebook make to a bank about the authenticity of its members? What liability would Facebook be willing to accept for misidentification?

    Facebook identities have spread like weeds (literally) but their sheer numbers doesn’t mean they can breed with any native species (account IDs) in the banking ecosystem.

    See also
    http://lockstep.com.au/blog/2011/06/28/how-do-i-know-thee.html
    http://www.bankingreview.com.au/2011/10/mambo-misses-the-point.html
    http://lockstep.com.au/blog/2011/01/13/no-such-thing-as-a-passport.html

  2. Email had more functionality than phones and was much quicker than driving across town (or taking a plane) to talk in person. Win-win-win…

    Much of that other stuff is marketing. Paying to access your own money is a good reason that most people still hate ATM’s. At least it’s a choice, though. In the 1960’s, everyone had to wait for banking hours and get off work. Cell phones can be setup to block unwanted calls but some dishonest people will spoof other numbers using the feature intended for businesses with 2 lines. The tracking aspect is a good excuse for paranoid people to get a pager, heh.

    I’d still not put my credit card details on a Chinese site that has 40-bit encryption and requires IE6 (LOL) or something like that. Just use common sense. Notice to banks: Any compromise of the outside content will severely weaken your own security. Everyone, no matter how big, will eventually face hacks. Think of pad locks put in series instead of parallel. They only have to break one lock to defeat the others. Having other site’s contents is a Bad Idea (TM) for banking websites.

    It’s not futile to resist stupidity. It’s definitely futile to resist intellegence. Smart wins in the long run. Making stalking, spying, harassment, and so on trivial, is just plain stupid. Worse yet, people share other people’s information on there. I’ve seen a scam in person where someone calls all your relatives and friends and claims to be a bill collector or something along those lines. This is even with unlisted numbers or numbers that you never gave out except to relatives and friends. They also have information that is very useful to social engineering attacks(say, pretexting to get enough information to steal identities). Phone companies and Facebook are both partially to blame for that. A secret spoken, isn’t. Once the cat is out of the bag, your identity is pretty much broken with the way the system works right now. Yes, this is related to the stupidity of a SSN being used everywhere, all the time.

    Computers that could do everything in one box that fits on/under your desk (and later, carry with you) and cost less than the price of even a single-purpose word processor, made a lot of sense back when people were paying 10’s of thousands of dollars for equipment that was essentially single-purpose implementations of the same exact functionality. It also saved money because you needed less people/time/room to get the same job done. Software and miniturization where game changers. Now, even a $50 used computer has way more power and software than the Apple II or XT had. This is progress. A machine that actively works against me, would be a regression, BTW. Say, trying to use a Nintendo 3DS in place of a recent iPhone or laptop. Actually, even an old iPhone or laptop. Even a locked-down iPhone gives me more freedom and useful features than a 3DS. Note that the comparison is valid – a computer is still a computer, no matter how fancy a plastic wrapper or proprietary storage we apply to it. It’s the software and interface that make the difference. The laptop obviously has the most software freedom of all, but the phone isn’t far behind in practical terms (even with lock-in).

    I consider most of those sites to be essentially be the AOL and Compuserve of WWW 2.0. It’s what almost everyone will go to first and then grow up to go outside the walled garden. It’ll probably slowly morph to that, just to compete. That, or outlaw the outside world. 😉 If customers want to use Facebook, let them. If they don’t, you’d better not have iframes from who-knows-where on your supposedly secure website. You’re one browser exploit away from extreme pain.

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