Internet-enabled digital devices continue to equalize access to information and level the playing field in every industry including banking. Internet banking resulting from the internet revolution of the early 1990s paved the way for digital equality between big banks and credit unions. Fast forward 30 years, and by 2010, personal computers reached 75% adoption in the U.S. according to the Pew Research Center. With personal computers, for internet banking, all one needed to do was to turn on the computer, login, connect to the internet, start your web browser, go to your credit union’s web server, login, and a few clicks later you were able pay your bills in the comfort of your home. This internet banking revolution was only the beginning of digital transformation in banking.
In 2007, Apple’s iPhone lead the smartphone revolution that propelled digital devices and digital access even more readily available. According to Statista, more than 75% of adults in the U.S. population will have a smartphone by 2019, a mere 12 years later, equating to more than twice the rate of adoption compared to personal computers. Given that your smartphone is always on and always connected, with mobile banking you can move money and even deposit a check much easier and faster than when you use your personal computer. Mobile devices compared to personal computers are more prevalent – more than 75% of global internet traffic originates from mobile devices, according to Zenith.
Internet banking and mobile banking ushered in by the two digital revolutions have helped close the service gap between a large multinational bank and regional credit union. With these digital channels, credit unions are able to provide rich services to its members just as well as a big bank, without the need for a large branch network.
Just under three years ago, a new generation of the digital device was born – the smartspeaker – starting with the introduction of the Amazon Echo. This new category of digital devices is not just always on and always connected, it is hands-free with far-field microphones. Plus, starting at less than $50, these devices are already in millions of households. According to Gartner, 75% of households will have smartspeakers by 2020, a mere six years after introduction – twice the rate of adoption of smartphones and more than four times the rate of adoption of personal computers.
This smartspeaker digital device also includes an artificial intelligence voice assistant such as Amazon’s Alexa. When combined with a hands-free, far-field microphone you can say “Alexa, move $200 to my daughter’s account” while you are making coffee in the morning. This kind of voice banking is very easy and more convenient than even the traditional mobile banking.
While digital devices may not replace the need for branches and face-to-face interactions, these devices have made it easier for credit unions to compete more effectively with big banks. Smartspeaker skills, as compared to smartphone apps, will make this even more so, by enabling members to have a personal teller from your credit union to be in their living rooms with 24/7 availability. Voice authentication will make voice banking not just convenient but also secure. In this new world, an omnichannel approach to digital banking will allow you start a transaction using a smartspeaker while making coffee in the morning and complete it when you pick up your smartphone later.
Perhaps soon, one can imagine a scenario where you tell the smartspeaker “Alexa, ask my credit union to deliver $200 to my home,” before you leave for a trip to Toronto, and an Amazon drone will bring you the money in less than 20 minutes! Assuming, of course, that cash has not been completely eliminated.
This article was written in collaboration with Chris White of RTN Federal Credit Union and Scott Bingamanof St. Francis X Federal Credit Union.
Siva G. Narendra is the CEO and Co-founder of Tyfone. He can be reached at 661-412-2233 or [email protected].
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