Saturday, 21 January 2012

Have you secured your digital identity?

Last week I spoke to James Varga from miiCard. The miiCard proposition is very simple - it allows you to prove who you are when transacting online. How many times have you opened an account online and not only been asked to fill in lots of details but also to send in copies of bills or cancelled cheques, to 'prove' who you are? This process doesn't necessarily prove anything and is a terrible customer experience. miiCard changes all that by allowing you to use a pre-authenticated identity when applying for or using services online. Imagine you want to apply online for a mortgage; using your miiCard at the start of the application proves you are who you say you are and saves rekeying lots of information. Both parties gain from a simpler, more secure, application process. Or on a dating site, wouldn't you rather date someone who has proved who they are? Or buy on auction sites from people you know you can trust?

How does miiCard work? When you set up your account you enter your online banking credentials which miiCard uses to identify you as the owner of the bank account. That bank account will have been opened using identity documents and now that identity is used to create your miiCard. Your personal data is secure at all times; miiCard never actually sees it and it is not stored on any system. miiCard uses Yodlee, who have many years experience managing financial transactions, to handle the bank authentication process.

Once miiCard goes live on service provider websites, consumers will start to see the value in having a miiCard. miiCard brand awareness will also increase as consumers start to see it on more and more websites. In the early days I can see accepting miiCard being a competitive differentiator; availability of a miiCard authenticated application process would certainly make me more likely to use a particular service provider.

This video gives a nice summary of the miiCard proposition.

Incidentally, miiCard stands for My Internet Identity Card. You can follow miiCard on Twitter at @miicard.

You can sign up for miiCard here.

Sunday, 1 January 2012

Why are the banks looking backwards?

One interesting result of the UK banking crisis has been the availabilty of two pools of bank branches from The Royal Bank of Scotland and Lloyds Banking Group; both banks having been forced by the EU to sell branches as a condition of state aid. Santander was the successful bidder for the RBS branches and The Co-operative Bank appears to have beaten NBNK for the Lloyds branches. Also, National Australia Group is apparently open to offers for their Clydesdale and Yorkshire branches, creating a third opportunity for a bidder.

What is curious about these branch disposals is that organisations are interested in acquiring not just customers with their loan and deposit accounts but the physical branches as well. What is the purpose of bank branches? Once they were the only way to engage with your bank but in 2012 consumers can manage their accounts via the Internet or on the phone. Yes I do sometimes go into a bank branch to deposit a cheque, but that's only because the banks have yet to come up with a simple, consumer friendly, person-to-person payment service. Bank branches appear to exist primarily to service outdated payment methods and allow banks to sell more products to consumers, who'd much rather not be there, standing in a queue, in the first place. They are a costly overhead for banks which should focus on delivering relevant products and services to consumers where they need them, not in buildings that most of us would prefer to avoid.

If you examine what day to day banking means to most consumers, it's about knowing how much they have in their accounts and making payments. These activities should be carried out in the most convenient way possible; which means via devices consumers use every day - their phone, their laptop, their iPad and so on. Banking should be contextual and adapt to a consumer's circumstances. Some banks have made a reasonable attempt at creating consumer centric Internet sites and mobile apps, however these channels are still an extension of and not a replacement for the branch. Plus, access to new services should be a simple process from any convenient device without the need to fill in long application forms.

The move to contextual banking has been best summed up by Brett King of Movenbank - "Banking is now something you do, not somewhere you go". This tenet underpins Movenbank's whole approach to banking and will be at the core of their services when they launch this year.

Will traditional banks embrace the opportunity or continue to focus on an expensive and dated infrastructure?

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