Technological change often precipitates changes in the business world. There are a number of examples of companies being “left behind” by technological innovation; being slow to adopt to new technology or to allow nimbler competitors steal their market share. But there are also examples of companies needlessly adopting new technologies without asking themselves if they should.
RBS recently called out Barclays for “doing technology for technology’s sake” and it’s hard to disagree. RBS specifically mention Barclay’s bPay band, a bracelet that allows increasingly tech-savvy consumers to make contactless payments. While it’s true that it may be slightly quicker to pay via a wristband, but it’s hard to imagine anybody willing to wear such a thing for such a small convenience as not having to unsheathe their bank card. More recently Barclays announced two new bPay devices – a keyring and a sticker that can facilitate mobile payments utilising existing chip technology.
It isn’t the first time Barclays has developed a product that is useful in a way that people don’t really care about. Along with their mobile phone contactless payment tag, Barclays also had plans for contactless gloves for those who found getting cash out of their pockets too cumbersome. That idea didn’t seem to get past the prototype phase of development.
Ignoring the fact that the gloves would be mostly useless anytime it wasn’t cold out, the ‘idea’ simply repackaging existing technology and solves problems that don’t exist. So it seems there is at least one bank doing tech for tech’s sake. But people do want their banks to embrace technology generally, just maybe not in the way Barclays – and others – might guess.
In a YouGov study 47% of participants said they would not like to use their mobile phones for contactless payments, with 81% of them concerned about security issues. Another 30% said existing contactless technology was sufficient.
Consumers aren’t rejecting technology. Many, especially the younger generation, will want their banks to have apps and online services that are useful and make their lives easier. The ability to make transfers and check balances on the go are useful services. In fact, this has been received so well, people may well eschew traditional – and, importantly, physical – banks entirely.
A survey carried out by Intelligent Environments found that 13% of people will switch to a digital-only bank account when they become available. Sure, that’s not a majority, but it’s a significant number of people when you consider this is something entirely new. They also found that 60% said mobile and digital services are important to them, supporting the idea that customers are pro-tech.
People are interested in banking technology, with 51% saying online banking was their preferred way of doing things. We’re still a way off digital banks becoming widely adopted, but it’s certain that what banks do with technology will affect how they attract customers. A concentration on improved services and unique products, such as useful apps or more flexible customer service, is going to be key.
Tech for tech’s sake needs to be left behind. Digital banks, with cheaper operating costs and a focus on useful technology, could be very disruptive for the bricks-and-mortar bank industry. A pair of gloves and an ugly bracelet won’t do much to stop that.
