BBVA Innovation Edge. Mobile Banking (English)

page 1Innovation Edge April 2012 | MOBILE BANKING

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2APRIL 2012

NEW EXPERIENCE IN THE POST PC ERA

Mobilebanking

Mobile (R)evolution

Opening the doors for our customers

Global snapshots

Forecasting for innovation

Trending issues

Technology trends



Anywhere World

Enabling an Anytime,

New innovations are providing novel ways to enable an “always on” society: mobile, social, and cloud technologies are being interwoven into the fabric of everyday life creating new value or offering new efficiencies. The mobile handheld device is becoming the touchpoint for a wide array of products and services, as mobile devices are the “go to” gadgets for most consumers. Businesses want to be well-positioned to take advantage of the opportunities, including financial services companies.



2000

719 million 6.16 billion

2011

DEVELOPED COUNTRIES: 469 million (65%)

DEVELOPING COUNTRIES 250 million (35%)

DEVELOPED COUNTRIES: 1.64 billion (27%)

DEVELOPING COUNTRIES 4.52 billion (73%)

2005

2.21 billionDEVELOPED COUNTRIES: 990 million (45%)

DEVELOPING COUNTRIES 1.22 billion (55%)

mobile subscribers mobile subscribers mobile subscribers

The first commercial mobile service was

launched 32 years ago in Japan, as NTT Do-

CoMo began offering mobile communica-

tions service to customers on December 1,

1979. Today, we are on the cusp of pervasive,

global connectivity, as mobile phones have

broken the 6 billion subscription mark in 2011

(See the mobile penetration graphic below).

Although much of the technology “under the

hood” has changed since the early days, in es-

sence, mobile devices have transformed from

a simple phone to a personal computing and

communication device in a handheld format.

While the world is still exploring and discover-

ing additional opportunities that mobile tech-

nologies may offer, it’s clear that we are on our

way to an anytime, anywhere economy. With

the right business model, companies can

serve 6 billion customers using mobile tech-

nologies: for creating and maintaining “sticky”

relationships with customers; and as the main

channel for the delivery of the companies’ val-

ue proposition in a customer-centric way.

source: Communities Dominate Brands | Celebrating 30 Years of Mobile Phones, Thank You NTT of Japan. 2009.

source: ITU (International Telecommunications Union) | Key Global Telecom Indicators for the World Tele-communication Service Sector. November 2011.

Mobile penetration timeline

CONNECTIVITY

Mobile banking and other related products

and services would not be possible if our

world wasn’t connected. Thanks to telecom-

munication companies (referred to as Mobile

Network Operators or MNOs), 6 billion peo-

ple can potentially participate in the global

mobile technologies.

(10’ tour)



economy with a mobile phone. That sounds

like great news. However, the connectivity

providers are not a happy bunch these days.

They are upset because they feel as though

they weren’t allowed to extract maximum

value from their investments in infrastruc-

ture. While Amazon, Facebook, Google, and

a whole lot more were striking gold in the

Internet, the connectivity providers were left

standing practically empty handed, relegated

to the “pipes only” business with unflattering

margins. Put that together with the ongo-

ing shrinkage of their traditional voice busi-

nesses (both fixed-line and mobile), one can

see why the telecommunication companies

are strongly motivated to explore only those

business models that make sense for them

in the mobile space. The telecommunication

companies are extremely important, as they

are providers of access and bandwidth. If the

connectivity providers can’t make compel-

ling business cases for the forthcoming ma-

jor upgrades, such as LTE (Long Term Evo-

lution, a next generation technology which

provides sufficient bandwidth for 2-way

streaming of high-quality live videos); the re-

ality of anytime, anywhere business models

may be delayed.

DEVICES

There are two main types of devices: “dumb” and

smart. The “dumb” devices are also known as

“featured phones.” They are the familiar phones

that our parents and grandparents envision

when they think about a mobile phone. Then

there are the smart devices, the ones that are

leading the way in the post-PC era. The smart

devices are sub-divided into tablets (such as the

iPad and Galaxy Tab), smartphones (iPhone,

Blackberry, Galaxy S, etc.), and handhelds (iPod

Touch, PSP, DS3, etc.). Essentially, they are pow-

erful computers in an ultra-compact format. At

the end of the day, the customer will access any-

time, anywhere products and services via these

devices. The device manufacturers will spur new

capabilities and, in turn, will spark new business

cases, such as NFC technology (Google’s Wallet

is an early example).

OS PLATFORMS

The aforementioned devices need an OS

(Operating System) platform to run. Currently

there are several OSs in the market, such as

Apple’s iOS, Google’s Android, RIM’s Blackber-

ry OS, Nokia’s Symbian, Nokia/Microsoft’s Win-

dows Phone, Samsung’s Bada, etc. For smart-

phones and smart devices, Android and iOS

are clearly leading the pack.

APP STORE PLATFORMS

Although the most popular and best-known

app store platforms are offered by OS plat-

form providers (for example, Apple offers the

App Store for iOS and Google offers the An-

droid Market for Android OS), there are also

other app store platforms, such as the ones



provided by some MNOs. Also, the concept

of app store platform is also evolving as we

are noticing the emergence of enterprise

apps and private apps store concepts.

APPS

The word, “Apps,” automatically provokes an

image of these really cool buttons that we tap

on our handheld devices to do things. Tech-

nically, those apps are known as native apps.

They are custom-built applications that run on

a specific OS platform, often times written for

a specific device or set of devices. They offer a

rich experience for the end-user as the device’s

capabilities are incorporated into the app, such

as NFC, GPS, camera, etc. However, there is a

price to pay for the richness: native apps must

be developed per individual OS platform, which

can quickly push up the costs of development.

On the other hand, there is another type of app

(although lesser known): web-based apps. In

essence, any “mobile enabled” site accessed

via a mobile browser can be considered a web-

based app. The advantage of this approach is

the “write once, publish many times” capability

as web-based apps are device agnostic. Most

people think that web-based apps are unflatter-

ing but new developments such as HTML5 are

quickly blurring the line between web-based

apps and native apps; and it may prove to be a

robust and cost-efficient way to produce apps

that provide a rich user experience.

Connectivity

Devices

AppsA

App Store

OS platforms

Wireless connection to the network

KEY PLAYERS:

Mobile Network Operators (MNOs), such as Telefonica, ATT, Verizon, etc

Handheld device manufacturers

KEY PLAYERS:

Apple, Samsung, HTC, Nokia, LG, Sony, Nintendo, etc

Operating System of smartphones, tablets, or other devices

KEY PLAYERS:

Android, iOS, Blackberry, Windows phone, etc

Virtual Store for app purchases

KEY PLAYERS:

Apple´s, Google´s Android, RIM´s App World, Nokia´s, etc

Native or web apps

KEY PLAYERS:

App developers



Mobile(R)evolution

Retail Banking industry analysts define Mobile Banking as “platforms that enable customers to access financial services.” There are three main technologies employed in Mobile Banking: SMS, Mobile Browser, and Custom Applications; and collectively, they are referred to as “Triple Play.” In terms of business models, Mobile Banking offers banks new ways to relate to customers (acquisition & retention; and up/cross-selling opportunities) and a new channel (which also happens to be the most cost effective). Depending on geography and footprint, Mobile Banking can be “additive” or “transformative”; in other words, “One of Many” or “One and Only”.source: Juniper Research. White Paper: Banking on Mobile. 2009.



Technically speaking, Mobile Banking is

composed of three mobile technologies:

SMS (Short Messaging System), Browsers,

and Apps. Collectively, they are known as

triple play. These virtual customer relation-

ship touch-points and channels can be devel-

oped “by hand” by the bank or be purchased

“off the shelf” from Mobile Banking solutions

providers. Most banks are going the “safe”

route and adopting off the shelf solutions.

In order to differentiate ourselves from our

competitors, BBVA has chosen “the road less

traveled” and we are doing it “by hand.”

Functionally speaking, Mobile Banking is a

customer relationship touchpoint and chan-

nel. In other words, it is one of many different

touchpoints and channels a bank may have.

However, it is the touchpoint and channel of

choice of an increasing number of retail bank-

ing customers, especially Gen Y and Gen X.

source: Business Model Generation

To clearly understand Mobile Banking and its

implications, it may be best to think of it as

“additive” or “transformative”.

Additive: Mobile Banking as One of Many.

Mostly applicable in developed coun-

tries or metropolitan areas in developing

countries. Markets are highly competitive.

Generally, Mobile Banking is one of many

channels and customer touchpoints and

offers the highest convenience. Driven by

Smartphone/Smart device adoption. Gen-

erational issues are influential.

Transformative: Mobile Banking as One

and Only. Mostly applicable in rural areas

in developing countries and out of foot-

print areas in developed countries. Mar-

kets need to be developed. Mobile Bank-

ing enables (opens the doors to) previously

unapproachable, new customer segments

and offers access to banking products and

services. Driven by inexpensive handsets.

Generational issues are less influential.

source: BBVA | Money for All ( Internal Document). 2011.

source: Juniper Research | White Paper: Bank-ing on the Mobile. January 2009.



Mobile

banking

technologies

SMS

Mobile browser

Custom aplication

USE. Widespread in developing world, many alert applications and some payment options in developed world.

PROS. Can be used across platforms and carriers, smart and dumb phones, easy to use and fairly safe.

CONS. Not permitted in some regions, some security concerns, reduced functionality.

USE. Widespread in developed world, particulary within regional and 2nd tier banks, mobile browsers connect mobile users to an augmented inter-net banking site.

CONS. Fairly common practice (no competitive advantage). Takes a number of steps to log in. Adaption to small screen not always done well.

PROS. Familiar to internet banking customers, simple integration with ex-isting internet platforms, works across devices and MNOs.

USE. Gaining significant traction in the developed world, used for mobile banking, coupons and location based services.

PROS. Provides a rich user experi-ence. More secure and stable. Retains loyalty and offers cross-selling opportunities.

CONS. Integration issues required for each device. Must be installed by customer. Can be more expensive to deploy.



Like many other industries, the retail financial services industry is in the midst of disruptive changes: mobile, social, and cloud technologies are reshaping industries and creating new ones. Something new seems to be on everybody’s minds: in the retail banking segment, the something new at the moment is Mobile Banking.

doorsfor our customers

opening the



As part of an overall retail banking busi-

ness model, Mobile Banking offers the

stickiest touchpoint for banking customers

and most economical transactional cost for

banks. It also paves the way for new value

propositions and new banking models. How-

ever, as in other industries, new entrants are

aggressively entering into the retail bank-

ing business and posing new challenges for

bank executives as they explore and seek

out the right business model.

source: Bank Technology News | Banks Seek Sticky Relationships from Mobile Apps. February 2012.

According to the 2011 EFMA & McKinsey re-

port, “The State and Future of Mobile Bank-

ing,” mobile banking for the retail bank seg-

ment (as a whole) is a “zero-sum” game: “new

revenues have been largely captured by non-

banks, most players have yet to reflect the

convenience of mobile in their pricing, and

the experience of many has been that the

mobile channel is an extra cost rather than a

cost reduction opportunity.” Overall, the “val-

ue creation opportunity … is neutral at best.”

source: EFMA & McKinsey. The State and Future of Mobile Banking. p. 7. October 2011.

However, for individual banks, the report goes

on to say that there are three major opportunity

areas in Mobile Banking:

Ultra-convienient and innovative banking.

Digital Commerce.

Disrupting new markets.

Once the overall strategy for Mobile Banking

is formulated, each bank will have to integrate

the “additive” Mobile Banking into its retail

banking business model. For banks aiming

to be shapers, they will have to resolve the

“transformative” aspects of the model.

Strategy defines Opportunities

Ultra convenientDigital

CommerceDisrupting

new markets

Leader Multichannel to deliver ultimate convenience Drive sales via mobile Reduce cost to serve

Shaper Grounbreaking services Active partnerships First mover in unbanked and new markets

Follower Mobile friendly website and basic application 110100111001100100010

00111010101001001000

1010101001110101010010x x110100111001100100010

00111010101001001000

1010101001110101010010

110100111001100100010

00111010101001001000

1010101001110101010010



Additive Mobile BankingAdditive Mobile Banking adds to the existing

business model has two main objectives: in-

crease customer stickiness and reduce op-

erating expenses by having a unified infra-

structure (for example, CCB). In general, the

bank offers Mobile Banking as a complement

with its other channels (please see the issue

No 1 for more information regarding banking

channels). This model is prevalent in devel-

oped countries or metropolitan areas in de-

veloping countries.

BENEFITS OF ADDITIVE MOBILE

BANKING INCLUDE:

Migration of customer transaction

to the lowest cost channel.

Adds to the customer-centric

business model.

May help banks to generate new value

propositions and revenue opportunities,

such as mobile payments and cross-sell-

ing/upselling opportunities.

source: Tower group. Fiserv. Mcom 2009

Call Centre$4.00

IVR$1.25

ONLINE

$0,17

ATM$0,85

MOBILE

$0,08

Branch$3.75

TRANSACTION COSTS BY BANKING CHANNEL



In general, transformative mobile banking are prevalent in rural areas in developing countries and out of footprint areas in developed countries.

Transformative Mobile Banking Business ModelsTransformative Mobile Banking creates new

value for banks by providing access to new

Customer Segments, thus offering banks

new sources of revenues. In other words,

they can help banks go where it couldn’t go

with existing business models (BM). Transfor-

mative Mobile Banking aims to develop new

customers (unbanked and underbanked)

through the lowest-cost transaction channel

via a “branchless” strategy. This model is ei-

ther led by a bank, an MNO, a 3rd party (for

example, a mobile payment provider), or as

a joint venture between two or more par-

ties. The concept of ecosystem is important

here, as the banks’ skill and experience in

ecosystem management will likely become

a key skill to operate these BMs effectively. In

general, transformative mobile banking are

prevalent in rural areas in developing coun-

tries and out of footprint areas in developed

countries.

Thus far, three main Transformative Mobile

Banking Business Models have emerged:

Bank-led models, Mobile Network Operator

(MNO)-led models, and 3rd party-led models.

BANK-LED MODEL

MNO-LED MODEL

3RD PARTY-LED MODEL



BANK-LED MODEL

The banks offer strong capabilities in treasury, risk management, and fraud detection; and access to capital mar-

kets and investment opportunities. However, in developing countries with a large share of population lacking

financial sophistication, all the aforementioned strengths vanish. Traditional interest rate models do not apply

to low-income customer base; the infrastructure is not cost effective; and unbanked customers are not always

aware (and may not even care) of the bank’s brand.

FINO Bank (India)

MCB Bank (Pakistan)



MNO-LED MODEL

The MNOs offers their large customer base a easy to use financial transaction services with their own distribution

model. MNOs can leverage their customers’ need to buy airtime citizens in developing countries have and facilitate

person to person remittances and bill payments to increase their ARPU (average revenue per user).

G-Cash (Philippines)

M-Pesa (Kenya-Tanzania)



3RD PARTY-LED MODEL

3rd parties, usually technologically driven companies, have strong technology capabilities. However, they lack

the bargaining power over larger banks and MNOs and certainly lacks the capillarity of an MNO’s distribution

network.

Yellow Pepper (LatAm & Caribbean)

Wizzit (South Africa)



Mobile Banking possibly can add to or even transform the retail banking business model by offering anytime, anywhere access to financial products and services. As banks explore the opportunities and benefits, they must be wary of the complications that also come with them.

fullHalfor Half Empty?



When Mobile Banking technologies and

its components are “put together” the

right way, according to the EMFA & McKinsey

report, they can “collectively turn it into a unique

value proposition. … This effectively means that

bank customers can ‘meet’ their bank every

day, albeit remotely. These features plus a flexi-

ble cloud and ‘app’-based technology platform

enables a more rapid development and inte-

gration with third party products.” The benefits

of mobile devices are:

Anytime, anywhere availability

Unique IDs (and their use), specific

to each customer

Simple to use, usually with rich User

Experience

Enablement of Location

Based Services (LBS)

“Go to” devices for consumers

source: EFMA and McKinsey & Co. | The State and Future of Mobile Banking in Europe. October 2011. p. 5.

With the aforementioned benefits of mobile

technologies, banks can offer value proposi-

tions.

Information reporting

Alert messaging

Money transfers

Recurring bill payments

Check deposits

p2p payments

Bank location services

Adding payees through a mobile application

Statements

Administrative functions

Funding cards

Mobile wallet

Personal financial management

Location based merchant offers or coupons

Click to call

NFC or proximity payments

Loyalty rewards

Coupon offers

77%

73%

64%

58%

55%

46%

40%

35%

34%

34%

28%

27%

25%

20%

18%

17%

15%

12%

Some of the offers will result in the creation of new value propositions for customers

Percentage of banks currently offering these features:



RISKSLike all good things in life, success seems to come hand in hand with challenges and Mobile Banking is no exception. Ac-cording to a recent survey conducted by KPMG regarding mobile banking us-age; security, technology adoption, cost, and regulation are the biggest chal-lenges faced by mobile banking. The first two challenges are related to con-sumer concerns and the latter two chal-lenges are provider related concerns.source: KPMG | Monetizing mobile: How banks are preserving their

place in the payment value chain. July 2011. p. 11.



Customer related concerns “is it safe?”

Security is the number one risk for banks and

is also a key barrier for consumer adoption.

It’s been noted by some industry observers

that the EFMA & McKinsey report fails to

mention security (at all). Nonetheless, both

mobile banking providers and customers

clearly place it at the top of the list. Mary Mo-

nahan, adirector at Javelin Research, also ad-

dresses the concern for security. She states,

“The main reason consumers don’t move to

mobile banking is because of security con-

cerns, … Consumers want to know that their

mobile interactions and transactions are en-

crypted, and they want some assurance that

they will be reimbursed for losses associated

with a mobile-banking breach.”

source: BankInfo Security | Mobile Banking: Consumer Education Needed. November 2011.

Also, customer education or awareness is a key

element for mass-adoption of mobile banking,

both in mature and emerging markets.

Provider related concerns: “Show me the money!!!”

Gartner analyst, David Furlonger, during the

Banktech Summit in Sydney wrapped a cold,

wet towel around the warm fuzziness of mo-

bile banking, stating that most mobile banking

applications are used to check balances, rath-

er than making payments (globally): “Nearly

all the interactions on mobile so far have been

checking balances, … “That doesn’t sound like a

way to make money. ”Adding to this, regulation/

legislation is also perceived to shrink margins,

making mobile banking a bitter pill to swallow.

source: ITNews | Gartner casts shad-ows on mobile banking. July 2011.

Specifically in developing markets, banks

need to also understand ecosystems and

manage it well to leverage the mobile bank-

ing opportunities. Given this, inexperience

and unclear management objectives related

to ecosystems may pose as risks or barriers

for banks, such as not understanding the

importance of agents or the logic of MNOs’

business models.

In addition, especially in transformational mo-

bile banking, MNOs pose a risk in that they

need to find a business model that works. As

mentioned earlier in the mobile technology

overview, while they can be valuable part-

ners for mobile banking, they can place de-

tours ahead by delaying anytime, anywhere

capabilities.



snapshotsthe BBVA

experience

Mobile World

global

What´s going on around the world in mobile banking? Conceptual “pictures” of mobile banking practices are presented, covering 12 countries in 4 continents.



GLOBAL SNAPSHOTS

Mobile World

ACTIVOBANK (PORTUGAL) AND MILLENIUM BCP (POLLAND)

Recognized as the Best Mobile Bank-

ing in Europe award by Global Fi-

nance Magazine, ActivoBank and Mil-

lenium BCP mobile banking solutions

are available via a native app for the

Android and iOS devices, as well as

a light browser application for other

phones. The mobile banking solution

offers customers standard banking

solutions, such as account balance

and activity, payments, and card man-

agement. Additionally, the app offers

branch and ATM location information,

FX rates, information regarding up-

coming payments, simplified activa-

tion, application update information,

and other customer centric features.

SCOTIABANK (CANADA)

ScotiaBank is Canada’s most international bank, with global pres-

ence across the Caribbian, Central America, Latin America, and

Asia. ScotiaBank offers “triple play” mobile banking solutions:

“App Mobile Banking” allows customers to check accounts

(personal, small business, borrowing and investing), transfer

funds between Scotiabank accounts, pay bills, send and receive

e-Transfers, send Western Union money transfers, and find

nearby branch or ATM on smartphones (iOS and Android)

“Browser Mobile Banking” allows customers to check per-

sonal and small business accounts, pay bills, transfer funds

between Scotiabank accounts, pay bills, send and receive

e-Transfers, send Western Union money transfers, and

find nearby branch or ATM on WAP enabled phones.

“Text Mobile Banking” allows customers check account bal-

ances, view the last 5 transactions, and view credit card informa-

tion (available credit, minimum payment, and due date) via SMS.



CITI MOBILE – CITIBANK

Citibank’s portfolio of Mobile & Tablet Banking so-

lutions is comprised of “Citi Text” (SMS), “Citi Mo-

bile for Smartphones” (Mobile Browser), “Citi Mo-

bile Apps” (Custom Applications), and “Citi Tablet

Apps (Custom Applications); essentially, a triple

play. Citi’s solutions support iPod, iPhone, iPad,

Android devices, and Kindle Fire. Mobile banking

solutions include from making account balance

inquiries, transaction history, pay bills and track

payments, deposit checks (RDC), see recent activi-

ties, transfer money between accounts, perform

p2p payments, and track rewards programs.

CHASE MOBILE (JP MORGAN CHASE)

Chase offers the complete combo: text, browser,

and app based mobile banking solutions. The app

offers the most functionalities; as it enables custom-

ers to check account balances and transaction

history, pay bills and credit cards, transfer money

between accounts, make p2p payments, and de-

posit checks remotely (RDC). Chase supports the

iOS, Android, Kindle Fire, and Blackberry mobile

operating systems. Furthermore, the app offers

a comprehensive contact directory (with auto-

dial) and search for the nearest branch or ATM.

GLOBAL SNAPSHOTS

Mobile World



BANK OF AMERICA

As early as 2007, Bank of America (BofA) launched its

first mobile banking services. Today, there are more than

9.5 million customers actively using mobile banking solu-

tions; which includes a mobile website, text banking, and

native apps. Currently, BofA offers native apps for the

iPhone, iPod Touch, iPad, Blackberry, Android, Windows

Smartphones, and (most recently) Kindle Fire operating

systems (OS). Regardless of the OS, the BofA’s mobile

banking apps offers the same functionality, including ac-

count overviews, bill pay, and fund transfers. According to

BofA’s mobile channel executive, “customers can expect

additional features for its mobile apps in the coming year.”

ICBC (CHINA)

ICBC is the winner of two AppStore awards in China:

Best iPhone Financial App of the Year and Best iPad

Financial App of the Year. Aside from the standard fea-

tures, such as account management, money transfer,

and mobile phone recharge; it also offers value-added

features, including foreign exchange, securities trading,

investment funds services (it even makes recommenda-

tions!!!), and allows users to buy and sell precious metals.

GLOBAL SNAPSHOTS

Mobile World



Transformative bank-led models

FINO (INDIA)

FINO is an Financial Inclusion Solutions and Services company;

which is promoted by public and private sector banks (including

the ICICI Bank), insurance companies, and the International Finance

Corporation. They are headquartered in Mumbai, India. FINO has

two main lines of business: Technology products and business cor-

respondence services. As a technology provider, the company of-

fers solutions which enable financial inclusion, micro-finance, and

remittances. As a business correspondence services company,

FINO offers its agent network to perform the “last mile” services for

financial services companies.

FINO employs over 2,500 employess and has a solid agent net-

work (which is 20,000 strong), spread across 239 offices. The

agents are equipped with GPRS enabled handheld biometric

authentication which reads the customers’ smart card informa-

tion. By offering “doorstep” banking and other financial services

with cost-effective transactional costs, FINO is currently serving

35 million customers across 24 states. The company purports

that their customer acquisition rate is around 50,000 per day.

GLOBAL SNAPSHOTS

Mobile World



Transformative bank-led models

GLOBAL SNAPSHOTS

Mobile World

MCBANK (PAKISTAN)

MCB Mobile was launched in 2009, which was a joint collabora-

tion between MCB Bank Limited and Fundamo. MCB Mobile was

a pioneer by delivering a cost-effective banking solution outside

of their branch footprint area. MCB Mobile offers banking ser-

vices to the underbanked and unbanked consumers who gen-

erally have mobile phones. Customers of MCB Mobile can view

account balances, transaction history, pay bills, make payments,

transfer funds between accounts, “top off” mobile phones.



Transformative MNO-led models

GLOBAL SNAPSHOTS

Mobile World

Swipe to see more

M-PESA (KENIA-TANZANIA)

Developed by Vodafone and deployed by their affiliate, Safari-

com, in Kenya; m-Pesa has been a Cinderella success story for

“transformative” mobile banking led by an MNO, surpassing the

14 million customers since its launch in 2007. Not bad for 5

years of work.

M-Pesa offers a wide range of financial services, including view-

ing and managing account(s), paying bills, making payments,

buying airtime, making deposits and withdraws (branchless

banking), and transferring funds. Additionally, M-Pesa also al-

lows customer to buy tickets (m-ticketing) and pay school fees.

All of the features of M-Pesa is made available via a featured

phone.



Transformative MNO-led models

GLOBAL SNAPSHOTS

Mobile World

Swipe to see more

G-CASH (PHILIPPINES)

An internationally acclaimed micro payment service, G-Cash of-

fers banking services via SMS. G-Cash customers can transfer

money, pay bills, buy airtime, and make payments via a network

of government agencies, utility companies, cooperatives, insur-

ance companies, remittance companies, universities, and com-

mercial establishments. Also, G-Cash customers can access the

service via basic mobile phones or the internet.



Transformative 3rd party-led

models

GLOBAL SNAPSHOTS

Mobile World

Swipe to see more

YELLOW BANK

Founded in 2004, the Miami-based Company is the recipient of

the first IFC (World Bank) equity investment in a mobile financial

network company in the Americas. With 3.6 million unique us-

ers in nine countries, processing over 18 million monthly trans-

actions, the firm has been selected by more than 40 banks and

strategic partners in the region.

Yellow Pepper’s most promising product is its mobile wallet, an

innovative bank account that the user manages via simple text

messages from their mobile phone, never having to set foot on

a bank branch. According to Fast Company the company in Hai-

ti had over 110,000 wallets with Digicel, a mobile phone carrier

that owns 32 networks from the Caribbean to the Pacific with

over 11 million customers and Scotia Bank Haiti. With the fast

growth of the service mobile wallets could number in the mil-

lions as the service is expanded to other parts of Latin America

providing much needed financial inclusion to the bottom of the

pyramid.



Transformative 3rd party-led

models

GLOBAL SNAPSHOTS

Mobile World

Swipe to see more

WIZZIT (SOUTH AFRICA)

Wizzit offers a secure and efficient payment mechanism to the

unbanked and underbanked consumers in South Africa. The

company offers mobile transactional services via a featured

phone (and now online). The services allows customers to

make p2p transfers, buy airtime, pay bills, make payments, and

offers a Maestro debit card. Wizzit was conceived in 2002 and

launched in 2005. Along the way, the company had to discover

customer needs, while making it affordable, and secure a bank

partner, a pretty impressive feat when considering that it is one

of “new to the world” innovation (no instructions were included).



Mobile Banking Technology

Platforms Providers

Generally, banks have limited choice when

deploying mobile banking technologies: DIY

(Do It Yourself), Off the Shelf Products, or a mix

of the two. Below, leading providers of OTS

FUNDAMO

South Africa-based Fundamo, acquired by Visa in

June 2011, is a leading platform provider of mobile

financial services for mobile network operators

and financial institutions in developing economies.

Fundamo has more than 50 active mobile financial

services deployments across more than 40 coun-

tries, including 27 countries in Africa, Asia and the

Middle East. Fundamo’s deployments currently have

a base of more than five million registered subscrib-

ers and the potential to reach more than 180 mil-

lion consumers with mobile financial services.

The Fundamo Enterprise Edition mobile services

platform includes Mobile Banking (which delivers

Additive Banking and is typically for financial institu-

tions wishing to provide mobile banking as an addi-

tional electronic channel to access existing accounts)

and Mobile Wallet (which delivers Transformational

Banking, typically for mobile network operators

and financial institutions who want to address new

market segments with a differentiated offering).



FINACLE (INFOSYS)

Finacle solutions address the core banking, e-

banking, mobile banking, Islamic banking, treasury,

wealth management and CRM requirements of

retail, corporate and universal banks worldwide.

Finacle mobile banking solution provides bank-

ing services through SMS, GPRS/ 3G and USSD-

enabled handsets, leveraging a single platform.

The Mobile Banking and Payments module includes

account management, deposits, funds transfer, bill

payment, remote deposit capture, Forex, cheque

management, ATM/ Branch locator, remittances,

peer-to-peer payments, business-to-business pay-

ments and contactless payments. The Mobile Fi-

nancial Management module adds analysis tools,

transaction tagging and product comparators. Value

added services include mobile commerce, mobile

ticketing, mobile top-up for prepaid card, mobile

advertising, mobile remittances to charity causes,

mobile wallet, stock trading services, and mobile

virtual financial advisory through video chat.

MONITISE

Monitise plc is a British technology company de-

livering mobile banking, payments and commerce

solutions. As well as partnerships with most UK

high street banks, Monitise provides services to

over 250 financial institutions in the United States,

has more than 6 million users worldwide, with live

services in the UK, the US, India and Africa, and

has a global partnership with Visa Inc to deliver

its services to more than 1.9 billion card-holders.

Monitise’s flagship product, Mobile Banking, enables

a wide range of services including bank and credit

card management, mobile top ups, transfers and

payments. In addition, savings and lending prod-

ucts can also be managed. It allows a variety of

customer-configurable alerts, delivered either via

SMS or smartphone ‘push’ notifications. It can also

act as a secure interactive ‘CRM’ channel between

the bank and their customers, enabling service and

sales opportunities such as card activation, lost/

stolen card management and personalized offers.



GLOBAL SNAPSHOTSThe BBVA

experience

Amongst mobile banking pundits, custom-built native apps are the holy grail, which allows banks to leverage the unique properties of each device to provide the highest level of personalized, customer experience without having to depend on 3rd party providers. BBVA’s award winning mobile banking apps enables anytime, anywhere banking for our customers, making a perfect fit with our Customer Centric Bank (CCB) framework: either as part of an integrated multi-channel strategy (Additive banking: One of Many) or as part of a branchless banking strategy (Transformative: One and Only).

See the screenshots in the next pages

iPhone Android BlackBerryWindows phone 7 iPad




experience

iPad




experience

iPad




experience

iPad




experience

iPad




experience

iPhone




experience

Android



Windows phone 7



Blackberry



“Practice makes perfect,” so the saying goes;

and BBVA has been rather busy perfecting its

mobile banking solutions. Backed by the CCB

framework, BBVA provides customized native

apps for all major OS platforms for its custom-

ers in developed markets.

In the US, the market for mobile banking is

fiercely competitive. In order to position our-

selves as market leaders, BBVA aggressively

pursued a strategy that provided the high-

est quality native apps for mobile devices,

including smartphones and tablets (iPhones,

Android devices, Blackberry, Windows Phone

7, iPhone, and the Blackberry Playbook). With

the apps, customers can find see account

information, RDC (remote deposit capture),

check accounts in real-time, make transfers,

and pay bills. Please visit the “Trending Is-

sues” section of this month’s issue of Innova-

tion Edge to see another BBVA first: opening

an account with an app!!!

In Spain and Portugal, BBVA went from “zero”

to “hero” in no time. Prior to February 2011,

we had 0 (zero) native apps for mobile bank-

ing and, just one year later, we now offer na-

tive mobile banking apps for 4 different OS

platforms: iPhone, iPad, Android, and Black-

berry (with Microsoft Windows Mobile in the

works). Yes, a hero.

RECENT & FUTURE DEVELOPMENTS

Along the way, BBVA picked many “kudos”

from users and we were awarded the “App

of the Week” honor for the week of Novem-

ber 3, 2011 in Apple’s App Store (Spain & Por-

tugal). Also, BBVA published a geo-location

app for the iPhone and Android OS, which

helps customers to find the nearest branch

or an ATM.

In Chile, Contigo BBVA app supports local

commerce deals: retail partners can use

the app to promote specific campaigns, re-

deem coupons, and offer proximity based

advertising.

For the future, the BBVA Mobility Office is de-

veloping other mobile banking functionalities,

such as the integration of fidelity cards, e-cou-

pons, and NFC payments, allowing BBVA to

offer new value propositions through the mo-

bile channel.

While most of our headlines related to mobile

banking deal with the “Additive: One of Many”

concepts, BBVA has also made contributions

to “Transformative: One and Only” innova-

tions. In Mexico, BBVA Bancomer introduced

“Cuenta Móvil Express” which utilizes the

mobile phone number as the bank account

number. Only proper identification is needed



to open an account. Due to its simplicity and

practicalness, the launch of the product has

been a resounding success (especially with

the local media). In Peru, BBVA Continental

launched native apps for the iPad and Black-

berry in April 2011. Subsequently, a new ap-

plication was released to the market which

further extends mobile banking capabilities.

The launch of the pioneer service in Peru was

received very well. There are other initiatives

in Chile (“Contigo Chile”) and Argentina (BBVA

Banco Francés) where the group introduced

a location based offers where customers can

find the best local deals.

BBVA has also published a geo-location app for the iPhone and Android platforms that allows customers to find the nearest branch or ATM.



Forecasting forInnovation

BBVA is ready for the Mobile Banking (R)evolution and we are leading the way. The Customer Centric Bank (CCB) offers the overall framework of the business model in which Mobile Banking makes a perfect fit. For retail customers, our award winning Mobile Banking solutions offer BBVA customers anytime, anywhere banking; paves the way for personalized location based offers; and opens up possibilities for branchless banking, especially for customers in “out of footprint” markets.

As we seen, Mobile Banking is fast becom-

ing key component in a highly complex

and competitive retail banking environment:

not only can it increase banks’ efficiency, it

can also help banks create new value. As

such, Mobile Banking should be an integral

part of every bank’s retail banking business

model. To sum things up, we’ll start by re-

ferring to the recent EFMA/McKinsey report,

“The current state and future of mobile bank-

ing in Europe” (2011):

Mobile has the potential to revolution-

ize the customer experience in personal

financial services, with non-bank organiza-

tions often leading the way.

Banks expect mobile banking to trans-

form the retail banking landscape, but ad-

mit that they are not acting or investing ac-

cordingly.



The unique characteristics of the mo-

bile device present three distinct areas for

proposition’ and marketing innovation: ul-

tra convenient banking, digital commerce

and the opening up of new markets and

segments.

The opportunities will create significant

scope for individual players to win (and

lose) market share – but the overall impact

on banking value creation will be at best

neutral.

Banks must shape, lead, or follow the mar-

ket, they will only succeed if they make a

conscious choice on which strategy to pur-

sue and take concrete action accordingly.

source: EFMA and McKinsey & Co. | The State and Future of Mobile Banking in Europe. October 2011. p.1.

So … few opportunities and many challenges

lie ahead for banks as they grapple with Mo-

bile Banking. Given the highly competitive dy-

namics of the market, no one can blame the

banks as they play the “wait-and-see” game

and seek to position themselves to be in the

“leader” group without assuming too much

risk. However, while the banks are busy neu-

tralizing incremental advantages amongst

themselves, new competitors are entering

the market with new business models that

create and capture value with Mobile Bank-

ing. What do you do when competitors com-

pete with business models? Mobile Banking

is transforming the retail banking landscape,

all at once.

Transformative Mobile Banking

Transformative mobile banking, in general, is offered to the unbanked population in rural areas of develop-

ing countries. As such, it is related to the financial inclusion of the “bottom of the pyramid” segment of the

world’s population. Thus far, very few initiatives have successful (in Africa and Asia-Pacific). However, the

successes are credited to very specific attributes and may not be “translated” well into other areas, such

as South America. However, there are some key considerations that might be worth considering:

Banks and Mobile Network Operators must work together as partners.

Distribution networks must include external agents, who provide footprint and sig-

nificantly reduce costs of operating and maintaining distribution.

Educating and offering support to agents are critical success factors.

Country specific regulatory concerns must be adequately addressed. In some re-

gions of the world, the rules of the game are not always clear.

3rd party technology providers may greatly speed up the rollout of mobile banking solutions.



In depthA list of links to other useful tools and resources that you may find useful as a supplement to the information offered on the ‘Simple Bank’ report.

Books & publicationsBankable Frontier Associates , World Bank - Consultative Group to Assist the Poor (CGAP) | Branchless and Mobile Banking

Solutions for the Poor: A Survey. January 2011.

Centro de Innovación BBVA | Innovation Edge 1. January 2012.

EFMA and McKinsey & Co. | The State and Future of Mobile Banking in Europe. October 2011.

Federal Reserve Board of Philadelphia (Julia Cheney) | An Examination of Mobile Banking and Mobile Payments:

Building Adoption as Experience Goods?

IDC | Business Strategy: 2011 Consumer Preferences Survey Results - Focus on Mobile Banking. January 2012.

Ignacio Mas and Colin Mayer (Said Business School) | Savings as Forward Payments: Innovations on Mobile Money

Platforms. September 2011.

Javelin Research | 2012 Mobile Banking Vendor Scorecard: Mobile Banking Has Moved from a “Nice-to-Have” to a “Must

Have” Channel. 2011.

Juniper Research | White Paper: Banking on the Mobile. January 2009.

KPMG | Monetizing mobile: How banks are preserving their place in the payment value chain. July 2011.

Market Research | Mobile Banking: State of the Market and Future Opportunities. November 2011.

Online Banking Report | Online & Mobile Banking Forecast: 2012 to 2021. January 2012.

Vision Mobile | Mobile Platforms: The Clash of the Ecosystems. November 2011.

Yankee Group | Telefónica Smells the Mobile Banking Coffee. February 2011.



On the webAite Group | Fraud The Latest Threats. February 2012.

Bank Technology News | Banks Seek Sticky Relationships from Mobile Apps. February 2012.

BankInfo Security | Mobile Banking: Consumer Education Needed. November 2011.

BankInfo Security | Mobile Banking: The New Risks. September 2011.

Communities Dominate Brands | Celebrating 30 Years of Mobile Phones, Thank You NTT of Japan. 2009.

GigaOM | The slow rise of the SoMoClo OS. February 2012.

ITNews | Gartner casts shadows on mobile banking. July 2011.

ITU (International Telecommunications Union) | Key Global Telecom Indicators for the World Telecommunication Service

Sector. November 2011.

TNS | Mobile Life: Global Telecoms Insight.

In depth



Trending issues Technology trendsIn the following section, we outline the upcoming technologies that will change everything, with predictions on what may come of them in financial industry.

Summaries of the most relevant news of selected topics that have been published over the course of the month based on its relevance to the Banking industry. The summaries were prepared by the editorial board. Further information is made available for each given topic.

also in this issue



Trending issuesIn this section, readers will find summaries of the most relevant news of selected topics that have been published over the course of the month based on its relevance to the Banking industry. The summa-ries were prepared by the editorial board. Further information is made available for each given topic.

Core banking platformsHere you will find articles related to basic IT infrastructure which supports main banking processes, including technologies such as SOA, WOA, digital platforms, etc.

New formatsBased on design principles focused on customer insights, New formats offers retail banking customers more channels which are more granular and highly functional; a consistent, simple, and collaborative universal user interface; real-time intelligent processes; highly personalized solutions; and is open to social networks and the web. Examples of these new formats are provided here.

Mobile bankingRelevant news about mobile banking platforms (which enable customers to access financial services, such as transfers, bill payments, balance information and investment options) can be found here.

Enterprise 2.0Enterprise 2.0 is the integration of Web 2.0 technologies into business processes. Information regarding implementations of Enterprise 2.0, which generally involves a mix of social software and related collaborative technologies, can be found here.

Mobile paymentsThe process of using a hand-held device to pay for a product or service, either remotely or at a point-of-sale. Up to date information is provided.

Social MediaA group of Internet-based applications that build on the ideological and technologicalfoundations of Web 2.0 that allows the creation and exchange of user-generated content. Enabled by ubiquitously accessible and scalable communication techniques, social media is substantially changing communication between organizations and communities, as well as individuals.

Digital MarketingDigital Marketing of brands use all forms of digital advertising channels to reach consumers, including social media, via a wide range of delivery mechanisms such as mobile phones, sms/ mms, display / banner ads, etc.

Crowd financeA process where small amounts are money raised for a definite purpose, Crowd finance sources funds collectively from individuals. In other words, the money comes from a wide range of individuals and not from a single entity. Read more about it here.

App ecosystemThere are 5 main components in the current Apps Ecosystem: connectivity, devices, OS platforms, app platforms, and apps; along with related products and services providers (MEAPs, Mobility as a Service providers etc.).

New Gizmo eraA combination of Smart Sensors and Robotics will give rise to the New Gizmo Era, ushering in a new age of efficiency and productivity. It is believed that by 2013 there will be a trillion interconnected devices with embedded Smart Sensors, and some with Robotics capabilities.

New banking conceptsBanks around the world continuously explore new approaches to strengthen customer relationships, both in the virtual and the physical worlds; including Virtual assistants, natural language search tools, new marketing tools, different segmentation (children, gen Y,…) etc. This section will cover news along these lines.

Join & enjoyEntertainment is an integral part of our lives. Not only do we want to live longer, but we also want a better, fuller life. In short, we want to enjoy our lives. Access to entertainment will become instantaneous instantaneous, both digitally and globally. Gamification could be one way to foster health education on prevention.Infotainment and social networks are already an established trend, and news abound.

Smart cities + urban mobilityCities are continually growing and urban life is changing. In a Smart City, we find smart infrastructures with plenty of sensors, allowing agents (citizens, governments, and companies) to make better decisions based on real time information. The agents not only use RTI, but also contribute towards it. As a key agent, we will be exploring opportunities. An example of such change is the urban transportation system. The current system is unsustainable, and we foresee a future where we will be able to design a transport that fits the needs of the city and its citizens. This is achieved through changing vehicles physically and using information, integrated as an additional piece of the city transport.

HealthHealthcare systems around the world will certainly go through a profound transformation. Financial pressures, along demographics and citizen expectations, will demand massive adoption of new technologies to maximize efficiencies and create new value. Read about it here,



Trending issues

Core banking platform

New formats

Mobile banking

Enterprise 2.0

Mobile payments

Social Media

Digital Marketing

Crowd finance

App ecosystem

New Gizmo era

New banking concepts

Join & enjoy

Smart cities + urban mobility

Health

An iBank App Store?!?!

The concept of the app store will revolutionize core banking solutions, according to Don Free, a Research Director at Gartner. “Using an app store approach, you can break down the core banking system into smaller parts and drive significant innovations for the business. The app store approach allows you to access components without developing them. You can now change business processes without involving IT.” With the growing popularity of handheld computing, this approach may help banks find new revenue streams without straying too much away from core competencies.

source: Don Free (Research Director) Gartner | February 2012



Trending issues


New formats

Mobile banking

Enterprise 2.0

Mobile payments

Social Media

Digital Marketing

Crowd finance

App ecosystem

New Gizmo era


Join & enjoy


Health

“Branch Today, Gone Tomorrow: The Case for the Death of Branch Banking”

King sure knows how to share his ideas clearly and boldly: all bank branches will die (soon), “Stop arguing that the branch is still critical to the average customer. Realize it is just one channel for them to choose from, and increasingly of minor importance in their day-to-day banking relationship.” According to King, by 2015 the primary channel for day to day retail banking will be (in order of usage): Mobile, Web, ATM, Call Centers and Branches

source: Brett King, “Branch Today, Gone Tomorrow” | January 2012



Trending issues


New formats

Mobile banking

Enterprise 2.0

Mobile payments

Social Media

Digital Marketing

Crowd finance

App ecosystem

New Gizmo era


Join & enjoy


Health

Solving the Gen Y puzzle: BBVA Compass First to Allow Mobile Enrollment from an iPhone

Younger customers are going straight to mobile and they are bypassing online banking altogether. In a groundbreaking move, BBVA Compass’s new app allows customers to open a mobile banking account directly from their iPhone; providing a truly anytime, anywhere banking experience for customers. According to Alejandro Carriles, Executive VP and Director of Mobile and Online Strategies of BBVA Compass, “we think we’re creating a groundbreaking user experience.” At BBVA, mobile banking is not only an effective customer touchpoint but also a complete channel; accompanying clients during the each channel phase: awareness, evaluation, purchase, delivery, and after sales.

Source: Bank Technology News - American Banker | March 5, 2012



Trending issues


New formats

Mobile banking

Enterprise 2.0

Mobile payments

Social Media

Digital Marketing

Crowd finance

App ecosystem

New Gizmo era


Join & enjoy


Health

Be Social or Die!

The lifespan of organizations today, according Dachis (a social business), is about 15 years. Social business drives adaptation by solving real business problems; by offering a more effective way of “doing talent management, supply chain collaboration, business agility, risk management, and more successful products to driving revenue.” During a recent summit, a social business expert shared his success factors for social:

Listen, analyze, and engage, continuously

Integrate social into the flow of work

Plan for change and the unexpected

Turn on the network effect

Remove barriers to participate

Enable everyone to participate.

Source: Forbes | March 8, 2012



Trending issues


New formats

Mobile banking

Enterprise 2.0

Mobile payments

Social Media

Digital Marketing

Crowd finance

App ecosystem

New Gizmo era


Join & enjoy


Health

Cha-Ching!!! There a whole lot of money in NFC!!!

Can you say $75 billion US Dollars? That’s the size of the NFC market for mobile payments in 2015, according to Juniper Research. It’s no wonder big players are jumping into the pool for a chance to come out as a serious player in this seemingly lucrative market. Notable NFC projects include Google Wallet, Isis (a carrier-led joint venture between AT&T, T-Mobile and Verizon), and Visa PayWave..

Source: TechCrunch | March 8, 2012



Trending issues


New formats

Mobile banking

Enterprise 2.0

Mobile payments

Social Media

Digital Marketing

Crowd finance

App ecosystem

New Gizmo era


Join & enjoy


Health

Move over CNN and make room for YouTube and Vimeo

For adults under the age of 30, social media is clearly the news source of choice, displacing traditional news media outlets. According to Pew Research, there is “striking evidence that young adults and their elders at times have different news agendas and learn about news in different ways. … The Internet was more than three times more important as a news-learning platform for young adults than traditional media such as television, newspapers, and radio.” Since the release of “Kony 2012” video, there have been more than 110 million views on sites such as YouTube and Vimeo. Also, social platforms, especially Twitter and Facebook, played critical roles in diffusing information about the Kony 2012 video.

Source: MSNBC | March 2012



Trending issues

core banking platform

New formats

Mobile banking

Enterprise 2.0

Mobile payments

Social Media

Digital Marketing

Crowd finance

App ecosystem

New Gizmo era


Join & enjoy


Health

When you’re ready to go social, Where do you go?

A recent survey indicates that social media marketing is expected to dominate this year: 81% of CMOs plan to associate revenues to investments in social media. But the question remains, where do you go? To help answer this question, CMO.com turned to 97th Floor, a SEO and social media firm. Here’s the top 10:

Twitter

Facebook

flickr

LinkedIn

YouTube

Digg

StumbleUpon

Yahoo

Reddit

Del.icio.us

Source: CMO | February 10, 2012

A social bookmark-ing site used for sharing and storing bookmarked pages

Site is intended for people to bookmark content. You can see what people tag with your brand name, but communica-tion with them is nonexistent.

Not enough ongoing brand rec-ognition to make it worth your while unless you want to be known for providing reference content for later retrieval.

Not as big as it used to be, but informative, massive reference pieces bookmarked for later use can net you a few thousand recurring monthly visitors.

Pretty much everything about the site helps: When your page is bookmarked, it's a direct link back to your site. When you're on the front page of the site, the big category tag pages are full of trust, which will pass directly to your URL.

The community is fickle, and anything perceived as spam will be destroyed. However, look deep into the categorized "subreddits" to unearth small niche communities, and you could get valuable feedback.

Unless you're a bacon company, don't try to build your brand here. You'll end up banned from the site without even realizing what happened.

If Reddit loves you, then traffic is o�en right up there with Digg and StumbleUpon. Be careful: Push too hard for votes from your friends and risk being banned, but don't push at all and you'll wind up with nothing.

Make the front page and many reputable sites will pick up your story, generating valu-able backlinks and extending trust to your site.

A social news community where users post links to the site’s home page

Editor-driven and moderated, so this shouldn't be your primary focus.

Noncommercial sites are heavily favored by moderators, so business sites should not waste time in this uphill battle.

Get in the moderators' good graces, and you have a chance to hit absolutely massive num-bers -- but it's a long shot.

If you make the front page of Yahoo, then you will get a ton of backlinks, but chances are unlikely unless you are a large, established brand.

A social news site where community members can vote on stories

A social news community where members discover and share webpages

Paid StumbleUpon traffic can be a very targeted method of communicating, but whether you're reaching your existing customers is purely random and costly to determine.

A paid campaign can be good for brand awareness, especially following e�orts to get free, organic traffic to your home page. Targeting is very accurate, but keep in mind you're paying 5 cents per visit ($50 CPM).

Enables a diverse range of people to discover your content and share links via the su.pr link shortener on Twitter. Tagging helps, but you don't want the same people repeat-edly giving you a thumbs-up.

Very good if your story makes it to the top page for its tag. StumbledUpon's large user base enables many people to find and link to your stories. For vanity name searches, profile pages rank well, too.

A social news site where users can discover and share content

Not the site's primary strength, though occasionally an objec-tive third-party writeup as a PR e�ort, perhaps to counteract bad press or customer senti-ment, can be promoted.

Opportunities are huge, espe-cially for promoting objective press/blog coverage of your brand. Make sure content doesn't read like an ad, or your site might be banned for being overly commercial.

The grandfather of traffic spikes, so become active in the community or find someone who is. If your site is corporate, then consider launching an industry blog on a noncommercial Web domain to establish yourself as a thought leader.

Very good because even if your story doesn't become popular, then your page will still be indexed quickly. If your story does become popular, this is likely the best site in terms of getting linked to by bloggers.

A video sharing website where users can share and upload new videos

Whether you seek to entertain, inform, or both, video is a powerful channel for quickly engaging your customers, responding to complaints, and demonstrating your social-media savvy.

One of the most powerful brand-ing tools on the Web when you build your channel, promote via high-traffic sites, and brand your videos.

Traffic goes to the videos. If the goal is to get traffic back to your site, then add a hyperlink in the video description, but don't expect traffic to correlate closely with video views.

Very good for building links back to your site because videos rank high. Also a tried-and-true way for your brand to gain exposure.

A social networking site for business professionals

Not the primary focus, but cus-tomer engagement opportuni-ties are possible by answering industry-related questions, establishing yourself as an expert in the field.

E�ective for personal branding and demonstrating your organi-zation's professional prowess. Encouraging employees to maintain complete profiles to strengthen your team's reputa-tion is advisable.

Unlikely to drive any significant traffic to your site, though you never know who those few visits might be from -- perhaps a potential client or customer.

Very high page rank -- almost guaranteed on the first page of search results -- especially for your company name or individual employees' names, but that's about it.

An image and video hosting website where community members can share and comment on media

Unnecessary to spend too much time on this, though properly tagged photosets of company events can help customers put a face on the team behind your brand.

Participation in industry-related groups might get your photos, and thus your brand, viewed by people with similar interests, but numbers will be small.

Even if you get tens of thousands of visits to a photo hyperlinked with your URL, click-through rates are among the lowest around.

Heavily indexed in search engines, passing links and page ranks. Also helps images rank higher in Google Images and in building inbound links.

A social networking site where users can add friend, send messsages and build their own profile

Great for engaging people who like your brand, want to share their opinions, and participate in giveaways and contests.

Facebook brand pages are great for brand exposure. Jump-start your brand exposure through the ad platform, or hire a Face-book consultant to help you grow your brand presence.

Traffic is decent and on the rise thanks to share buttons and counters, but don't expect massive numbers of unique visitors to go to your site.

Little to no value, aside from blogs picking up and featuring your posted links. Not worth the time expenditure.

Use keyword search monitor-ing through a program such as Hootsuite, TwitJump or Radian 6 to track what people are saying about you and your competitors.

A microblogging site that enables users to send ‘tweets’, or messages of 140 characters or less

O�ers unique opportunities for Web site integration and to engage with customers in a viral way, helping your company stand out from the masses.

Potential can be large, but promotion is an art form -- promote your brand too heav-ily and turn o� followers, yet don't promote enough and receive little attention.

Value to your site's SEO is limited, but tweets will rank high in search results -- good for ranking your profile name and breaking news, though shortened URLs are of little benefit.

WEBSITE CUSTOMER COMMUNICATION

BRANDEXPOSURE

TRAFFIC TOYOUR SITE SEO

GOOD! OK. BAD!

THE SOCIAL LANDSCAPE2010 IS THE YEAR CMOS WILL HEAVILY INVEST IN SOCIAL MEDIA. HERE’S A GUIDE TO

HELP YOU UNDERSTAND HOW BEST TO LEVERAGE MAJOR SOCIAL MEDIA SITES.

THE CMO’S GUIDE TO:



Trending issues


New formats

Mobile banking

Enterprise 2.0

Mobile payments

Social Media

Digital Marketing

Crowd finance

App ecosystem

New Gizmo era


Join & enjoy


Health

Crowd sourcing goes “plastic”!?!?

MasterCard and Barclays US join forces to create “Barclaycard Ring,” the world’s first crowd-sourced credit card. The duo claims that it marks the herald of a new era in e-commerce and finance: card customers can negociate interest rates, rewards, and fees. The card offers an 8% interest rate with no annual or balance transfer fees. Additionally, the crowd will have visibility into the card’s financial picture, influence management decisions, and have an opportunity to share revenues generated by the card. The Barclaycard Ring will be available to consumers this spring.

Source: Silicon Republic. December 30, 2011



Trending issues


New formats

Mobile banking

Enterprise 2.0

Mobile payments

Social Media

Digital Marketing

Crowd finance

App ecosystem

New Gizmo era


Join & enjoy


Health

Facebook as an app ecosystem platform provider?

Facebook, during Mobile World Congress, touted their Pay Dialog mobile SDK; which allows “mobile operators to work with app developers to integrate operator billing into their apps.” Facebook already has partnerships with several telecommunications giants, such as AT&T, Deutsche Telecom, Orange, Telefonica, T-Mobile USA, Verizon, Vodafone, KDDI, SoftBank Mobile, etc. All this is part of Facebook’s plan to “push forward its Open Graph, drawing users away from locked-down platforms like iOS and giving them the opportunity to download apps that run freely on the Web and operate on any platform.”

source: The Next Web- Social Media | February 27, 2012



Trending issues


New formats

Mobile banking

Enterprise 2.0

Mobile payments

Social Media

Digital Marketing

Crowd finance

App ecosystem

New Gizmo era


Join & enjoy


Health

3 million iPads sold in 3 days

The first iPad took 28 days to sell 1 million units; the 2nd iPad sold 1 million during the first weekend; and the new iPad is off to a strong start: 3 million iPads sold in 3 days. At the flagship store in 5th Avenue (NY), 13,000 units were sold in the first 12 hours! That’s about 1,100 iPads per hour or 18 units per minute. That translates into revenues of $10,700 per minute at that location..

Source: Apple | March 19, 2012 and Motley Fool | March 21, 2012



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ATM is still going strong (& will get stronger)

ATMs are poised for future growth as there will be more transaction per person, more cash in circulation, and less branches (more ATMs); which would result in more total ATM revenue and profit for the banks. Specifically, according the ATM Future Tretnds Report 2012, by 2015, ATM transactions are expected to grow 66%.

Source: ATM Marketplace | March 1, 2012



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21st century culture: Games as Art

They’ve come a long way from the early days of video games (in the late 1970s), where a rudimentary “two-dimensional ball that (were) batted back and forth” provided hours of fun for time-wasting teens. On March 16, 2012, the Smithsonian American Art Museum inaugurated the “The Art of Video Games,” the first major exhibition dedicated to this new art form. According to the museum’s curator, Chris Melissinos (formerly the Chief Gaming Officer at Sun Microsystems) “I believe it’s society’s duty and responsibility to protect and nurture this medium because it will be the next great medium for expression, thought, poetry and art forgenerations to come. That’s incredibly exciting, and this is just one small step toward that goal.”

Source: BBC | March 16, 2012



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The End of Parking Woes?

It’s the reality of urban life: 33% of the cars on the road are circling around city blocks, much like vultures, hoping to find parking space. Aside from the stress, the situation also adds to city pollution, traffic congestion, and accidents. Future promise: a smart city with networked sensors installed in a city’s infrastructure helping drivers find the parking space, faster and smarter. A pilot project is underway in San Francisco, California which has magnetic sensors installed in street parking spaces, garages, and smart parking meters; the parking information is made available to the public via an app on smartphones.

Source: MIT Technology Review | January 25, 2012



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Socio-Economic Impact of mHealth

Telenor commissioned BCG to analyze the possible socio-economic impact of mHealth. Key findings of the study include:

Everyone (almost everyone) will have access to a mobile infrastructure: 7.4 billion mobile subscriptions projected by 2015.

The technology and bandwidth is sufficient, both simple and smart phones

There are more than 500 mobile health projects being executed globally

Elderly care costs can be reduced by 25% with mobile health projects

Maternal and perinatal mortality can be reduced by 30%

Twice as many rural patients can be reached by a doctor

Tuberculosis treatment compliance can be improved by 30-70%

By 2015, 30% of smartphone users are likely to use “wellness apps”

Data collection and related costs can be reduced by 24%

Among MDs, smartphone is the most popular technology since the stethoscope

Source: BCG/Telenor | February 28, 2012



The following section outlines the upcoming technologies that will change everything, with predictions on what may come of them in financial industry.

Technology trends

Someone Is Replaying Inside: SIRIThe dream of any artificial intelligence-based application is to under-stand and predict accurately the needs and preferences of the user, transforming intent into actions to perform tasks. Researchers and companies working on personalization technologies have been trying to address this issue for more than ten years. In order to do that, the sys-tem first would have to obtain information about the user, get behavior patterns and learn what will be the next best action that the user would need or would want to do. Sounds good, but we are still quite far from it.

gSo far we have Siri, the digital personal

assistant that Apple has included in its

iPhone 4S launched on fall 2011. Siri performs

actions under user requests, interacting by

using voice recognition and natural language.

It lets the user to ask questions, obtain infor-

mation and perform actions using the native

functionalities of the phone, that is send mails,

make calls, check, schedule and change ap-

pointments in the agenda, etc.



A LITTLE HISTORY...

Siri appeared as a simple iPhone app in 2010.

At that time there were some other similar but

less advanced apps, like MyBantu or Zokem,

also supposed to be personal assistants and

recommendation services, but they finally

came to nothing. However SIRI was a big thing.

It is based on the DARPA funded SRI research

project CALO (Cognitive Assistant that Learns

and Organizes), the largest Artificial Intelli-

gence project in U.S. history. With $150 million

of DARPA investment, the CALO Project was

focused on helping individuals manage an

extensive amount of task related information

(specifically emails) in an office assistant and

generate actionable tasks for situations such

as forming ad-hoc teams in military scenarios.

When it was an app, it had also more than 30

different partners whose APIs can plug into

when answering a request. These include

services like OpenTable, MovieTickets.com,

Eventful, StubHub, Taxi Magic, Rotten Toma-

tos, Bing, Google Maps and Yelp. Now, as part

of the operational system of the iPhone 4S,

it has acces only to Yelp, Wolfram Alfa, and

Google. However, it is integrated with email,

calls, sms, calendar, it learns from user ac-

tions: it may know for example who is impor-

tant for you without need to tell, based on

your actions with the phone. Siri gets better

the more you use it, learning from the user,

their preferences and their frequent actions,

adapting its response to them.

BUT WHY IS (OR COULD BE) SIRI

SO IMPORTANT?

Because it could be the top of the iceberg of

the future of the devices and its applications

based on AI.

The phone becomes sensor of the users

and their environment: it utilizes information

available on the user’s calendar, email sys-

tem, address book, social network, enhances



it with geo-location based activity tracking

and information declared explicitly by the

user, and generates context dependent user

profiles. At some point, Siri will have access

to databases and will be able to search and

obtain external information of third parties

to enrich the context, and delegate to other

apps to deliver services and perform tasks.

IN THESE ARE APPLE’S PLANS FOR SIRI,

WHAT IS THE CHALLENGE?

As always, the challenge is the combination

of big-data gathering and its analysis to pre-

dict the activity the user to deliver context

and relevant information, the improvement

of the semantic intent understanding, and

the increase of the capability of apps and

devices to talk to each other and talk back

to the user.

Now Apple has given the first step to de-

liver it to consumers, who’s next, Microsoft?

Google?



Work Smarter, (Not Harder) with Business IntelligenceGartner defines Business Intelligence as, “an umbrella term that includes the applications, infrastructure and tools, and best practices that enable access to and analysis of informa-tion to improve and optimize business deci-sions and performance.”(1) Or simply, it can be expressed as: Information Management + Analytics = Business Intelligence. With Social, Mobile, Cloud, and Big Data coming, companies should really think about BI.

g

The latest information related to Business In-

telligence keeps this macro trend as a priority

for BBVA for the medium term time frame. BI

initiatives can reduce cost, increase the qual-

ity and availability of information and analy-

sis, and help user make better decisions.

Corporate use of BI includes: financial analy-

sis, business activity monitoring, forecasting,

sales tracking, customer relationship man-

agement, operational process optimization,

competitive analysis, corporate governance,

product marketing, risk management, prod-

uct development, and fraud detection. The

Data Warehousing Institute says that using

Your business

Your management

Information technology

Business Intelligence



mobile BI improves customer sales, service

and support in a 65% and increase customer

self-service benefits in 45%.

Despite the challenging environment, BI is

expected to continue to grow during 2012.

International Data Corporation (IDC) states

that “the worldwide business intelligence

tools market generated more than $4 billion

in revenues in the second half of 2010”. Driv-

en my market demands, “the BI platform mar-

ket’s compound annual growth rate (CAGR)

through 2015 is expected to be 8.1%,” accord-

ing to Gartner analyst James Richardson.

The future direction of BI is heading towards

social, mobile, and cloud. For example, the pro-

liferation of tablets and mobile devices will lead

to the development of mobile BI. According to

the market study of, seniors managers using

Dresner Advisory Services mobile BI exceed

82%, and middle managers 55%.

The proliferation of tablets and mobile devices will lead to the development of mobile BI.


Published by

BBVA Innovation Edge is the result of a collaborative work done by all the people who are involved in innovation at BBVA Group.

Produced by Prodigioso Volcán

(www.prodigiosovolcan.com)

CONTRIBUTORS TO THIS ISSUE

Reyes Bolumar

Fernando Esteve

Antonio García

Eugenio García

Rafael Hernández

Miguel Angel Iñesta

Manuel Jimenez

Carmen López

Luz Martin

Samuel Martín

Manolo Moure

Marcos Pastor

Gerardo Ponte

Jay Reinemann

Alicia Sánchez

Marcelo Soria

Maria Tena

Luis Uguina

Jose Manuel Villa

Gustavo Vinacua

Sang Gu “Phil” Yim

Documents

BBVA Innovation Edge. Mobile Banking (English)