Post 1 – Over Regulation, Consumer Behavior, New Technology

Hello everyone and welcome.  This weeks highlights and the very first to be posted, provide briefings on 3 key issues facing Banking today.    These will be at the forefront of my posts.  (Regulations, Consumer Behavior & Technology).  I hope you enjoy the information I gather and post and it helps you in a “lite” non narrative format in gaining insight.  I find if I blog I learn more and become a better servant to my clients.

1. Over Regulation  –

  • Dodd-Frank, which will restrict fees, increase compliance costs and, potentially, further commoditized banking, making it harder for banks to differentiate themselves. By some estimates, Dodd-Frank will reduce profits by as much as 12 percent over the next five years.
  • The CARD Act, which reduces the amount of interest and fee income that banks can collect. Some have estimated that the CARD Act will reduce the average annual income of large banks by $500 million to $1 billion and of mid-tier banks by $50 million to $100 million.
  • The Basel III accords, which will more than triple capital requirements for banks, increasing their funding costs.”

2.  Consumer Behavior – 

Consumers are saving more, spending less and paying down debt. The US personal savings rate, in the low single digits a few years ago, is expected to continue rising, potentially reaching levels not seen since the 1970s and 1980s. While consumer thrift can reduce the demand for debit and credit cards, it offers banks the opportunity to benefit by offering financial planning and related products.

3.  New Technology – Smart Phones & QR Codes

Smart Phones – In 2011 mobile app usage as it relates to banking increased from 5.7 million users to over 11 million and browser usage increased from 15.4 million to 17.5 million users.  Other interesting facts about the Mobile Payment industry is that its grown to $17 Billion and expect to grow 68% by 2014.  RDC (Remote Deposit Checking) has taken the industry by storm as it’s both a hassle for consumers to deposit checks and costly for Banks.  Today nearly 1000 institutions offer RDC services.  As the usage of Smartphones increases so will the needs for Banks to offer a more homogenous platform approach for many services.

QR Codes – The information encoded in a QR code can be text, data or, most commonly, a URL. All you need to do is point your camera-capable Smartphone at the QR block, take a picture, and a website will automatically pop up on your screen.  First Bank is utilizing QR codes to attract new clients.  They’re offering options for 12 classic novels, Crosswords or Sodoku puzzles utilizing QR codes.  Organizations are placing QR code adds in quiet locations in their branches or offices where they offer special incentives and or free downloads to include their banking apps.


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