Archives for September 2011

11.14.11: Celent Toronto Area Digital Channels Executive Summit

Bart Narter, Senior Vice President, and Jacob Jegher, Senior Analyst, Celent’s Banking Group

This event is open to banks and is by invitation only. Registration is limited to four contacts per bank. Please click here for more information.

A Big Week for Workforce Optimization (WFO) Software

The past week saw two significant announcements in the world of WFO. Historically, use of WFO has been the domain of large organizations. In financial services for example, Celent estimates that 80% of top tier banks use WFO (those with assets of US$50b or more) while less than 500 US FIs employ WFO (about 3%). Said another way, the compelling WFO opportunity in financial services is to usher in adoption by midsize and small FIs. This objective has been aided by software as a service (SaaS) and managed services options that most WFO vendors now offer. One announcement in the past week was the acquisition of GMT Corporation by Verint Systems. Among large banks, Verint and GMT were the market share leaders. The combined entity will give Verint a dominant market share leadership – among large banks. Down market, other vendors – particularly FMSI and Kronos have market share leadership. And down market is where the WFO growth opportunity lies in financial services. That leads to the other big news in WFO this week – the announcement of a cooperative marketing agreement between Kronos and Fiserv. The two companies will integrate Kronos’ Workforce Central suite with Fiserv core systems, beginning with Signature. The two will then cooperatively sell the pre-integrated solution to the prodigious installed base of Fiserv core banking clients. Both announcements are big news in a space occupied by relatively few solution providers. For both Kronos and Verint, the announcements signal a growing interest in financial services – a sector underserved by WFO. Good news indeed. Other WFO providers and the remaining core banking vendors should take note.

11.17.11: Celent Banking Webinar: Outsourcing Trends in the Chinese Banking Industry

Celent analyst Hua Zhang This event is free to attend. Celent clients and the media will have access to the webinar’s PowerPoint presentation after the event. Please click here for more information.

A look back at Sibos

Another year over, and another successful Sibos. My previous post gave a sense (I hope!) of how long and busy the week was. Having finished the week, it now seems to have flown by. The pile of business cards and follow-ups are a testament to a productive series of meetings. In addition to the happiness of surviving the week, there was relief that some of the things many feared failed to happen – no euro disintegration, no banking collapse and most importantly of all – no reduction in the number of happy hour drinks each day. It will take weeks to complete all the follow ups, but a few observations. Much discussion about the economy and the impact that may have, primarily on the vendor side. One wag noted that the European country with the largest economic growth during the past 12 months was Belgium. Which hasn’t had a government for the last 12 months! I think this uncertainty was reflected in the stands. Many had reduced the size of stand this year. Swift places a limit on the amount you can grow or shrink your footprint from year to year, perhaps masking the true picture. Anecdotal evidence suggests many are considering not attending next year in Osaka for cost reasons. With the following year in Dubai dividing opinion (worries about whether the region is sufficiently safe, and the religious ethics – see this LinkedIn Discussion), the next couple of years could be significantly smaller. With Boston & Hong Kong rumored to be the venues for the following years, the backbone of European attendees may seek alternative events such as Eurofinance. With a diary full of meetings, I was unable to attend any sessions this year, other than the one I moderated. I’m hoping that I will be able to utilize the Virtual Sibos to catch-up. As of this morning, it was a little unclear as to how to access it, but I do note that the very large fee for doing so seems to have been removed from the page. From the conversations I had the following were the most common themes or questions: Hubs, hubs and more hubs. Payment Services Hubs are coming of age, but there is still a large gap in understanding (which can of course be solved by reading Zils excellent series of reports on hubs !) Following on from this, many of the discussions were around payments convergence, including processing cards through payment hubs. Are the card related businesses missing an opportunity here by not attending? Or rather, can true convergence take place if there are few conferences (only Nacha Payments springs to mind) that pull together the various payment types? For a corporate banking conference, there were a surprising number of discussions around mobile, and not just corporate “access”. Mobility, rather than just mobile, seems finally to be coming to the fore. Perhaps I missed them, but there seemed to be fewer announcements made at the show this year. I’m not sure whether this is a realization that its very difficult to stand out and get the attention you seek, or whether simply there were fewer announcements, full stop. And of course, regulation. SEPA end-dates, Basel III and the variations by region were just some of the topics. Most surprising though were the questions from non-UK organisations around the proposed UK banking reforms. The rest of the world is watching with interest at the very minimum. Finally, I’d just to thank all those clients who stopped me and said hello, and who gave valuable feedback. Always much appreciated.

Innotribe and SIBOS roundup

It’s been a hectic but great week at Sibos, chock full of meetings and interactions. The Celent Banking team was well represented and I made the rounds along with Zil and Gareth (see Gareth’s blog entry here). I managed to steal away from the traditional Sibos stream for a bit, and participated in several sessions at Innotribe. Innotribe is all about innovation in financial services, a topic I am very interested in and actively cover as an analyst. I also had the privilege of participating as a judge and mentor in the Innotribe $100,000 Startup Challenge (see my blog entry here). After a pre-Sibos voting and selection process, 10 startups were invited to give a 5 minute pitch to an invite only audience of VCs, bankers, and executives. Congratulations to winners Truaxis (formerly known as BillShrink) and GuardTime – they take home $50,000 apiece in prize money. Also a shout out to Mike Sigal for putting together an extremely well run and organized program. The startup competition was but one component of Innotribe. There were a variety of sessions and workshops on top of mind topics and issues including, social media, digital identity, big data, and the future of money. The sessions were designed in a manner to get participants to think out of the box, and collaborate on idea generation and problem solving. Most of the sessions I participated in were quite good and thought provoking. Some were nothing more than vendor pitches that I thought detracted from an otherwise quality event. The audience was quite a diverse bunch – some in suits and ties, others in t-shirts and jeans. Bankers, bloggers, strategists, innovation folks from banks, and a variety of others contributed to the colorful scene. All in all it was interesting, thought provoking, and entertaining. Cartoonist Hugh MacLeod from gapingvoid provided an additional dimension and extremely impressive drawings and charts. Congrats to Peter Vander Auwera and the rest of the SWIFT Innotribe team for putting on a solid event. Outside of the Innotribe bunker, Sibos was in full swing. The booths were as opulent as ever, and I bounced between meetings with bankers and solution vendors. I particularly enjoyed the mobile and tablet demos some of the vendors and banks had to show. I’m presently working on a report on corporate mobile banking so it was timely and relevant. The traditional SIBOS party took place last night at the convention center and it was quite the scene. I found it to be highly entertaining. No, it wasn’t the bankers letting loose on the dance floor. As a Canadian, I found the stereotypical depiction of my fellow countrymen to be somewhat odd. Models wearing fur during the fashion show, British flags, clips of hockey games on the TV screens, etc. – you get the picture eh? See you next year in Osaka, Japan.

Day 93 of Sibos

Or so it feels already. Whilst Sibos officially opens 9am on Monday, the reality is slightly different. The logistics mean that the conversations start on the planes flying in. I sat next to one of my favourite journalists, Jane Copper from The Banker, I made a new contact in Fiserv in the seat behind me and I moved a proposal forward in the taxi line somewhat faster than the line actually moved. And it’s pretty hard to find someone in the official hotels not attending the event. Furthermore, meetings and events take place before hand – Swift partner meetings on Sunday morning were followed by parties. I had 3 parties under my belt before the opening bell on Monday. In terms of topics and trends, most of my insights come from the meeting, both formal and informal – with so many meetings in the diary, many delegates, myself included, will attend only a few, if any, conference sessions. Regulation unsurprisingly is in every conversation. The Vickers report (the UK banking reforms) being new, has probably come up as often as the more expected topics of SEPA and Basel III. The future consolidation of suppliers is no surprise. The recent ACI/s1/Fundtech/Bankserv has been talked about, but so have many other alleged potential tie-ups (some of them mind boggling!). And I have been surprised by how many changes of people have taken place. I think this is being seen as a resurgence in confidence, indicating that, in at least the payments world, things are looking good long term. Other impressions. Stands seem to look slightly smaller this year, or rather perhaps, more uniform in size. For practical sakes, that makes navigating easier, though the hall still seems vast. But still an awful lot of money has been spent. Social media has come of age, though, the sheer volume of messages now, particularly with the marketers really having embraced twitter this year, has meant its not quite as easy to get as much instant value. At last, free wifi at a major event, which is partly driving that take-up of tweeting. However, I still wait for decent free wifi though, as the lack of access to email and the automatic 20 minute boot out is frustrating The layout – I’d be curious to see if there is a drop-off in lunch take-up. Its such a long walk (10 minutes), that if you weren’t hungry before you set off, you were by the time you arrived! Many of us have to snatch lunch – this takes long to walk there than you’ve allowed for lunch itself Finally – a big thanks to my hosts at the various events, parties and meetings so far. Much appreciated, especially those who have really gone out of their way to make some very important introductions happen.

First Look at PayPal’s Mobile Strategy

With preparations for SIBOS (see Gareth’s earlier blog), it would have been easy to miss PayPal’s announcement this week amongst all the other pre-SIBOS press releases. And it would have been a mistake, because it is important. PayPal talked about “re-imagining money” and “new normal in retail”. Often such platitudes don’t mean much, but if PayPal can implement what their slick video demonstrates, it might indeed be something special. Details are still scarce, but PayPal showed how it would change the retailing experiencing through mobile, but without changing the retailers’ terminals. No NFC, but code scanning; cards with PayPal logo (but no Visa/ MasterCard and not even a number). Checkouts possible without queuing at the tills. Deciding how to settle for purchases after a busy shopping day by putting some on PayPal credit and paying for others immediately through a card or bank account. More details will be needed to understand if and how this vision is going to be turned into reality, but for now, enjoy the film and I will see you in Toronto.

Canada, here we come

It’s that time again where the payments industry decamps for a week of meetings and parties under the banner of Sibos. This year it’s the turn of Toronto. For those of you have not been, it’s like no other conference I’ve been to in the payments industry. Whilst Cartes is larger in terms of visitor numbers, I thought it felt smaller than Sibos (20,000 visitors vs. 8,000). The stands and general slickness at Cartes is nowhere near comparable to Sibos though. Sibos stands have a certain swagger to them. Whilst NACHA Payments may have as large an audience, the exhibition is no where as near as large, reflecting the more practioner focus of the event. Rumours of $1m+ being invested by some exhibitors in Sibos are certainly believable when you see the size of some of the stands, let alone how well staffed they are, and the collateral, demonstrations, etc Is it worth that level of investment? Absolutely. For an industry built on trust, the opportunity to see the right people – albeit often fleetingly – to cement those relationships is invaluable. The seniority of people, and the right mix of people also means that real business gets done. My clients know that the 2 events that I nearly always recommend are Sibos and EBADay. There are 2 parts to the official Sibos event – the conference, and the exhibition. Celent will have a strong showing as usual. Highlights of our activity include Jacob Jegher being a judge and mentor in the Innotribe track and my session, the Executive Payments Forum debate, sponsored by ACI Worldwide on Wednesday at 3pm in CR 4. The event is such that there are all sorts of additional activities associated with Sibos, from the “Brought To You By The Community” presentations, to, of course, the multitude of parties. Whilst I suspect that the extravagance of some of these events has still to reach pre-crisis levels, judging by my inbox, the number certainly hasn’t. There would seem to be plenty to discuss in the corridors. Will we see another crisis unfold before our eyes, as we did in Vienna? Who will actually buy who in the unfolding drama of several of the vendors exhibiting? And of course, the most important of all – who’s got the best stand giveaways this year? With “only” c.50 formal meetings booked, my time to tweet and blog maybe limited, but I will try my best to bring you the highlights of the event – follow me at @gareth_lodge. And if you are in Toronto, please do stop me and say hello.

Is PFM The Future of Online Banking?

You will have to read my new report to find out the full answer. Although PFM solutions have been in existence for several years, adoption is pitiful. To give you an idea, only 3.8% of users across large banks and software vendors have been active in the last 30 days. It’s a horrific statistic, and it’s no wonder so many financial institutions are reluctant to move into the PFM realm. Here are a few examples of why adoption is so shoddy:
  • Poor overall online banking user experience and customization capabilities. See this post for more info and examples
  • Assuming PFM can serve the mass market (e.g. not everyone wants to or needs to budget. What a wealthy person needs or is willing to do online is not the same as what someone in debt requires or is willing to do).
  • Poor auto categorization accuracy
  • Lack of relevant and targeted user education
  • The list goes on and on

The good news is that adoption is expected to climb. The report has all kinds of forecasts that provide insight as to where PFM is headed. It also delves into qualitative details as to what is required by financial institutions in order to make PFM viable. There’s also a whole discussion about tablets and their role and potential in online banking and PFM.

10.25.11: Celent Banking Webinar: Outsourcing Trends in the Chinese Banking Industry

Celent analyst Hua Zhang This event is free to attend. Celent clients and the media will have access to the webinar’s PowerPoint presentation after the event. Please click here for more information.