The Changing Face of Banking, or, What Is a Bank, Anyway?Alissa Saoutina |
I know, you are probably wondering: “Where is the payments perspective in the message of the picture above?” But, think again. Is the message true? Who is it for? Will Citizen M hotel put Hilton Hotels & Resorts out of business? Probably not. To contrast with the message of the picture, consider this: the ability to attach a picture of a receipt to a recent transaction in your banking application beats trying to desperately remember what you bought at the grocery store.
The message on the luggage cart was part of a stunt, as someone Citizen M hired dressed up like a bellboy and canvassed major hotels in the New York City. The second message, an existing value proposition from a startup called Simple, comprised of a banking app with checking account, offers the ability to personalize your transaction history—helping consumers capture relevant, personal information about the purchase, and transforming a transaction into an experience.
By targeting a consumer’s personal attitudes, behaviors and lifestyles, and by re-framing the business model, companies in the hospitality and banking spaces as instanced above are addressing consumers’ needs in engaging, relevant new ways. In the banking world they are convincing established financial institutions to re-examine their current approaches. However, their ability to enter the banking space would not be possible without an advance in technology as well as the banks’ and networks’ willingness to participate in experimentation.
The messages in both cases challenges “traditional” value propositions and business models of the large established companies.
But let’s be clear about who’s challenging whom in the banking world. For the longest time, large national banks and local credit unions controlled the banking experience. Recently however, a slew of companies from diverse backgrounds including merchants and tech giants (and pygmies) have started to provide complementary services enhancing consumers’ banking experience. They are not necessarily replacing banks, but they can have a direct effect on consumer expectations as to how banking is done.
Over the course of the next few weeks, watch this space for explorations of how new, progressive entrants are reimagining cardholders’ banking initiation, experience and customer service.