Tech savvy and quick to grasp digital innovation, Robert Caccia of Wells Fargo loved the BlackBerry when it first came out years ago, seamlessly switched to an iPhone later, and embraced the Apple PayTM digital wallet. Then he met Wells Fargo Wallet.
During a brief transition, he learned how to use the new mobile wallet, which is part of the Wells Fargo Mobile® Banking App, and the Android smartphone that it runs on. Soon, he was sold:
“I became a fan right away,” says Robert, who used the mobile wallet as part of a pilot. “It is seamless at the point-of-sale. And people are just more comfortable inputting their card information with their bank, as opposed to other digital pay services. That’s a big plus.”
The July 18 introduction of Wells Fargo Wallet to 5 million customers who use Android phones could have a significant impact in the financial services industry, says Zilvinas Bareisis, a senior analyst for the Celent research firm. When Wells Fargo unveiled its mobile wallet plan in May, the announcement captured the attention of other industry players.
“When you have a very large financial institution like Wells Fargo offering a technology like this and throwing its weight behind it,” he says, “that gives more credence to this service in the marketplace and makes it more likely others will follow suit.”
While mobile wallets in different forms have been available for nearly half a decade, Wells Fargo is one of the first large U.S. financial institutions to launch a branded version, he adds. It is an approach he advocates as banks seek to engage their customers in the emerging digital financial services arena.
“The key,” says Zilvinas, “is offering customers the same kind of experience as an Apple Pay, for example, but from the branded Wells Fargo environment.”
Wells Fargo is one of the first large U.S. financial institutions to launch a branded mobile wallet.
Emmett Higdon, director of mobile research for Javelin Strategy, says Wells Fargo is actually the first large U.S. financial institution to go live with a mobile wallet that is fully integrated with the functionality of its mobile banking app. Its ability to operate within the mobile app and seamlessly add payment cards significantly increases the ease of use for customers, he says.
“What Wells Fargo has done is so well thought out from a customer experience perspective,” Higdon adds. “It will be very attractive to their huge Android customer base, who already have the app on their phones. It significantly reduces the friction to adopting and using the new wallet functionality.”
Wallet by the numbers
By all indications, the marketplace appears to be fertile ground these days for mobile wallet services. A recent study (PDF) by the Federal Reserve says 53 percent of all bank customers with a smartphone have used mobile banking, and 28 percent of all smartphone owners have made a mobile payment in the past 12 months.
The same study found younger users slightly more likely to use digital payments (30 percent for people ages 18 to 29, and 32 percent for those ages 30 to 44).
The statistics are reflected in the growth of Wells Fargo’s mobile banking channel, says Jim Smith, head of Wells Fargo Virtual Channels, which includes the digital products group.
“With more than 17 million customers, mobile banking is Wells Fargo’s fastest-growing channel in company history,” Jim says. “Approximately 38 percent of our mobile app customers use Android phones, representing 5 million customers. These customers have the highest amount of monthly sessions, logging in an average of 17 times per month.”
He adds that Wells Fargo Wallet delivers what customers say they want in terms of ease of use, safety, security, and one-tap convenience at the point of sale.
It also provides customers with instant display of their account balances before and after a purchase — a feature in high demand: The Fed study says 60 percent of mobile payment users took the extra step to check their account balances before making a purchase.
Cardless ATM and biometrics
Another key technology for the company is the cardless ATM, which allows mobile customers to conduct transactions with their smartphone without swiping a debit or credit card.
Wells Fargo announced in May it expects about 40 percent of its ATMs to be NFC-enabled by year’s end (a full list will be made available when they come online). NFC is an acronym for near-field communication, a wireless connectivity technology that allows devices to communicate when within short range of each other.
Biometrics is at the forefront of the company’s research and development efforts.
Later this year, customers also will be able to get cash from all ATMs by using an access code instead of a debit or credit card. To get the one-time code, customers will log into the Wells Fargo mobile app, select an account, and request a one-time code to enter at the ATM with their PIN number.
With Wells Fargo Wallet, however, no code is required — the transaction will be seamless and can be conducted with only a few taps of the smartphone.
Biometrics is also at the forefront of the company’s research and development efforts, says Steve Ellis, head of Wells Fargo’s Innovation Group. In addition to voice and fingerprint recognition, Wells Fargo is developing eye-print ID account access, with a rollout expected in October to commercial customers through CEO Mobile®.
“Technology is growing at a rapid pace,” he says. “The ability to hang on and go with the flow is the key to being successful in the business world. There is emerging technology appearing every day, and if a good idea comes along, the best thing you can do is recognize it and go for it.”
Summer of innovation
This summer represents one of the company’s most vigorous periods of technology development, from biometric security to mobile pay systems, Steve says.
“We want to be where our customers are.”
“From our stagecoach days, innovation has always been part of our DNA,” he says. “Our focus has always been to build capabilities that add tangible, long-term value to customers and team members — whether that’s offering new ways to access banking services from a mobile device, providing a more convenient method for authenticating customers, or redesigning processes that improve customer experiences.”
Through other new digital offerings, the company is covering every channel that customers use to interact with their bank. A few examples:
- In August, Wells Fargo will offer real-time person-to-person money transfers at no charge to customers who use its smartphone or tablet apps. They’ll be able to send money to any customer of a bank that participates in the clearXchange network.
- Customers interested in a home equity loan can now use their desktop computers to access live video chats with a Wells Fargo Home Lending representative. That pilot began in May, and the service is being considered by other lines of business.
- In July, the company will begin introducing its latest refresh of Wells Fargo Online®, with new online banking features designed to make it more informative, readable, and navigable for customers. It will be phased in regionally through the end of 2016.
- Banking by phone took on a new dimension in June with a pilot of a voice recognition system. Users can record their “voice print” and use it to access their accounts. A full rollout could happen as soon as 2017.
“We want to be where our customers are,” Steve concludes. “There are different ways we can connect to the bank, and what customers want is a consistent experience across all those devices. The customer experience is the heart and center of everything we do.”