What's not to like? Famous speakers, new products, several thousand attendees, statistics galore, and a floor filled with new bank tech. For me, the only disappointment were the non-industry keynoters, but that's not the reason I attend, they are just the part you can tell your friends and family about when you get home (note 2).

Like last year, I'll cut to the chase and hand out my personal awards for the event. I only saw a tiny fraction of the companies, so the list below are the merely my favorites culled from about two dozen company interviews. 

The Netbanker awards

• Biggest buzz: Person-to-person payments (we'll cover it in Online Banking Report soon).
  Runner up: Mobile banking and payments
• Most likely to make to grace the cover of FastCompany: Cardlytics (will cover next week)
• New solution most likely to be used by 1000 financial institutions: Continuity Engine's semi-automated compliance task-management service
  Least likely: Microsoft Surface, as cool as it looks, I just don't see banks deploying it in large numbers
• Most audacious business plan: Moneta, who won this very award last year, but did indeed show up in Boston with a major client win, SunTrust (see Celent's Jacob Jegher's not-at-all enthusiastic post on the announcement)
• Best ah-ha moment: When Joe Salesky, Clairmail founder, observed that mobile banking is a 100% solution, meaning it's for every customer NOT just the half that do online banking. 
• Biggest surprise: The buzz around person-to-person payments and relative lack of buzz around online PFM
• Most-talked-about vendor without a booth: PayPal which announced partnerships with three large bank tech companies: S1, FIS, and First Data's STAR unit
• Coolest online feature, not yet available: Credit card available-balance meter displayed directly on the user's PC desktop, powered by Worklight
• Coolest new GUI feature: Fiserv's ebill snapshots
• Best demo (I'd not seen before): Dynamic Card Solution's instant issue of a credit card with my picture on it along with a background image I chose from hundreds available
• Best-attended breakout session (that I attended): Checking 2.0 which analyzed what the product might look like if NSF/OD fee revenues are materially limited
• Best number: From the opening remarks by BAI director, Debbie Bianucci: According to BAI research 5 years ago, one-third of consumers preferred to deal with their bank remotely; now two-thirds do
  Runner up: Bank of America's Doug Brown revealed in his presentation that BofA has 3.5 million active mobile banking users (see recent monthly growth below)
• Scariest number: Sherief Meleis, from Novantas, prediction that new regulation could wipe out 20% to 40% of total checking account revenue
• Missing in action: Security solutions
• Coolest new event technology: Real-time text voting in the Checking 2.0 session
  Runner up: Wifi available conference-wide for the first time ever
• Most intriguing co-brand opportunity: Getting the bank logo on PayPal messaging (FIS, S1) to payment recipients or during payment sessions (FirstData STAR)
• Product I most wanted to use now: Digital Insight's (Intuit) FinanceWorks with Turbotax integration
• Best screenshot: Lamping on the iPhone (powered by ClairMail); I call it the "little red number" superimposed over iPhone icons, that tells you how many messages are available (see inset)
  Runner up: Worklight's visualization of its widget running in four environments with essentially the same GUI (see below)
• Best party: Geezeo's blowout at Lucky's
• Best freebie on the floor: Fresh lemonade from the wonderful people with a booth by the front entrance
• Netbanker spotting: Quote in BofA's Doug Brown's Powerpoint regarding BofA threepeat (in the mobile marketplaces)

And I'm always collecting usage stats and other numerical detritus delivered during the presentations. Here are my notes with (source in parenthesis):

• 27% of US households are now mobile only (Doug Brown, BofA)
• New mobile customers at BofA last 3 months: 150,000 (Sep), 210,000 (Aug); 220,000 (July) (Doug Brown, BofA)
• In U.S. and worldwide, text message volume has surpassed voice call volume (Doug Brown, BofA)
• 99% of mobile users view balances, 90% view transaction detail, about $10 billion of funds have been moved via mobile transfers/bill pay; 15 million location-based searches being performed (annual run rate)
• BofA has 35% of all mobile banking users (Doug Brown, citing ComScore numbers in 2009)
• BofA has added 150,000 new checking accounts due to mobile offering
• BofA seeing voice calls decline among mobile users, but online banking usage holding steady
• In pilot, 94% of the users of TurboTax within FinanceWorks chose their host bank as the place to have tax refund deposited (Digital Insight/Intuit)
• More than 50% of iPhone users have used mobile banking in past 30 days (Javelin Strategy)
• 33% of mobile banking users monitor accounts daily, 80% weekly (Javelin)
• Customer willingness to pay fees for (Novantas):
  -- Teller transactions 8%
  -- Bill pay 12%
  -- Mobile banking 12%
  -- Paper statement 19%
  -- ID protection 27% 
• At ANZ, 65% of its Yodlee-powered PFM (launched Oct 2008) users visit daily, 89% visit weekly (Doug Brown, ANZ; not a typo, there really were two Doug Browns)
• 81% of its PFM users rated the service at least 7 points on 10-point scale (31% rated 9 or 10, 50% rated 7 or 8)
• ANZ's PFM is a standalone free service that can be used by anyone; so far 20% are non-ANZ customers; the business case for the service was built on customer acquisition, but they also may charge certain users for certain functions
• Yodlee-powered PFM users spend twice as much time online at the bank, than regular users and only 1.5% leave the bank each year compared to 7% of regular online banking customers 
• Worklight case study results:
  -- 8% to 15% of online customers install widgets within the first year
  -- 95% of widget users are active
  -- Customers used widget 15 to 30 sessions/month via widgets

Worklight widgets running on a variety of platforms (4 Nov 2009)

Notes:
1. About BAI Retail Delivery Conference 2009
BAI Retail Delivery is an annual rite of passage for bank tech strategies, delivery system analysts, and product managers. At the peak, in 1999/2000, there were as many as 10,000 people there (attendees + exhibitors) and close to 500 exhibitors stretching perhaps three or four city blocks in each direction through cavernous exhibit halls. It was a little like Times Square but without the highrises. Some exhibitors had massive 10,000 square foot booths filled with hardware. And the show-floor routinely sold out.

Financial institutions brought teams of people to pour over the new machines and software solutions, be inspired at the general sessions where Bill Gates, Roll Perot, Scott Cook, and other tech-industry luminaries showed up to win over the bankers.

Fast-forward a decade. It's still an awesome event which I highly recommend. I thoroughly enjoyed every conversation I had and most every session I attended. But the event has downsized considerably. This year, you could walk across the exhibit hall in a few minutes. And if you wanted to, you could have spent five minutes with all 180 companies during the show hours. That would have been impossible last year with around 300 exhibitors. But all-in-all, I'd say there was more energy on the floor this year because the attendee per square foot ratio seemed much better.

2. Unfortunately on Thursday, both Al Gore (planned) and Jack Welch (unplanned back problems) phoned in their keynote addresses via sat link.

The new brand: Incredible Bank from River Valley Bank, an 18-branch $900 million (assets) bank headquartered in Wausau, Wisconsin.

The strategy: Like the original orange bank's Electric Orange account, Incredible Bank offers a high-yield checking account, currently paying 2%, that's 100% electronic. No paper checks (note 3). No paper statements. And unlike the hundreds of rewards-checking products, this one comes with no strings attached. The full rate is paid on all balances up to $250,000, then it drops to 1%.

Other account features:

• Debit card
• Free online bill pay
• Unlimited ATM reimbursement
• Overdrafts are $34 each with max 10 per day
• Incoming wires are $5 each, outgoing are $20
• Mobile banking (which is highlighted on the home page, see below and note 4)
• ACH in/out (coming soon)

Analysis
I've always wondered why, other than ING Direct and Kiwi Bank, only the UK direct banks seemed capable of a light-hearted brand positioning online (see update below). While we've seen many good social media and microsite efforts using humor, few financial institutions have dared use this approach on their core website. Leave it to those spirited cheeseheads in Wisconsin to break the mold finally (note 5).

Initially, it's the 2% rate that will bring cash to Incredible Bank. But longer-term, for any direct bank to add value to the parent's franchise, it must create loyal customers that don't bolt to the next newcomer offering a 15-basis-point rate advantage. This is a good start for River Valley, but they'll need a lot more than this bare-bones website to create long-lasting relationships.     

Hat tip: Bank Deals blog.

Update 9 Nov: The Financial Brand's Jeffry Pilcher reminded me of two good U.S. examples, GMAC's Ally Bank and (how could I forget?) Redneck Bank.

Incredible Bank homepage (9 Nov 2009)

Notes:
1. In his Retail Delivery presentation, always one of the highlights of the show for me, Second Curve principal Tom Brown, said ING Direct would be an attractive acquisition for any number of deposit-seeking large financial institutions. He did not name them however.
2. Full disclosure: I have a strange weakness for the color orange, maybe it was all those trips to Florida when I was a child. So, take anything I say in this post with a huge grain of salt. 
3. Normally, I think paper checks should still be made available, even if they are discouraged with fees. However, in cases where the direct brand will cannibalize deposits at the parent, it can make strategic sense to cripple the direct brand's checking account in this way. That way fewer River Valley customers will simply move their entire checking account over.
4. The bank has created a mobile site with shorter URL: ib4you.com. 
5. While Incredible Bank is quite different, the main River Valley Bank brand remains typically conservative, at least in its online presence. They don't even dare mention the Incredible brand anywhere on its website.
6. See our Online Banking Report: Growing Deposits in the Digital Age, for a dozen more strategies.

Yes, Bank One, Citibank and Wells Fargo all failed at person-to-person payments in 2000/2001, but this is much different. Those were payment services between individuals, not a point-of-sale option like PayPal, Google Checkout, and most recently, Amazon.com.

SunTrust's partner is Moneta, an Atlanta-based startup that debuted its alt-payment system at FinovateStartup earlier this year (video here). The joint effort was announced at BAI Retail Delivery in Boston earlier today (press release).

The program is already being tested on a large group of SunTrust online banking customers who recently received an email offering them a $10 cash-back incentive to make a purchase of $50 or more from one of the handful of merchants that currently accept Moneta-powered ACH payments. The biggest merchant is Delta.

Moneta's appeal to merchants is relatively straightforward: Incremental sales from customers unwilling or unable to pay via credit card online AND reduction in interchange costs by moving card-based transactions to Moneta transactions, with much lower interchange.

For banks, the business case is not as obvious. The hope is that Moneta-issuing banks share of interchange revenue will more than offset what the bank might lose in card-based interchange. While that may turn out to be the case, the more compelling benefit for banks is the brand and relationship value of offering a new payment choice with more perceived security and privacy advantages. There are also intriguing possibilities to add other revenue-producing value to those transactions.

Last year in my notes from the BAI conference, I named Moneta as the "most audacious business plan." Right now, it's too early to say whether Moneta can become a legit competitor to PayPal. But with SunTrust on its side, that audacious plan is MUCH closer to realization.   
Notes:
1. For the historical perspective, see our first report on person-to-person payments (published, Nov. 1999). 
2. In somewhat-related news: A year after PayPal CEO Scott Thompson made a keynote appeal to bankers at last year's Retail Delivery, FIS and PayPal announced a partnership today (press release) as did S1 (press release) that could bring PayPal-powered peer-to-peer payments to hundreds of financial institutions.

The Groundswell awards are based on business results using various social technologies. In total there are 16 categories.

The myFICO forum is currently receiving:

• 120,000 unique visitors in Sep 2009, up almost three-fold from a year ago (see chart below)
• 20,000 new posts added each month...with more than 500,000 posts archived
• 400,000 searches per month
• 10,000 new registered users per month

According to information supplied with the application, the forum is helping Fair Isaac in the following ways:

• Lowering call-center volumes: Total call center volume was down 1% in 2008 compared to a 23% gain the prior year.
• Reducing call-center talk time: 10% of callers are referred to the forum for more information and/or help from other users.
• Driving traffic: Traffic to myFICO.com from the forum equals about 40% of the volume from search engines.
• Improving sales: The average amount spent by a customer grows by two-thirds after they join the forum and 13% of all myFICO sales online involve a forum view.

While myFICO was the only financial services winner, Bank of America was one of four finalists among 23 entries in the B2C Talking category for its Morris on Campus student-banking campaign as was MasterCard Brazil for What's Priceless to You? 

Significance to Netbankers: myFICO's busy forum shows that despite the proliferation of blogs and social media, an old-school online forum is a good way to build a community and off-load the tech support burden. Of course, forums don't run themselves, and you'll spend a considerable time moderating them. But considering the alternative, it's an expense worth considering, especially if community-building is part of your strategic goals. Intuit has also had great success with its community forums, attracting 130,000 monthly unique users (see chart below).

myFICO forums (link, 29 Oct 2009)

Website traffic for myFICO and Intuit forums from Compete (link, 29 Oct 2009)

For more info:

• Online Banking Report: Credit Report Monitoring (Aug 2007)
• Online Banking Report: Bank 2.0 (blogs and social media, Oct 2006)

The fine print is relatively clear (reprinted below, after the screenshot). The main "catches:"

• Must not have a current McAfee subscription (see Results below)
• The subscription auto-renews at $34.98/yr, a 50% discount
• While in progress, the BofA offer never mentions number of users covered (the normal $69.99 subscription from McAfee covers three users, see note 1); however, during checkout, after accepting BofA's offer, the product description confirms three users are covered with the subscription

Bank of America is also publicizing the offer on its main website (here). To accept, users must log in to online banking first.

Results: I signed up for the account this morning and was surprised to find that you are not required to use Bank of America for payment. In fact, BofA is never mentioned again after leaving the original landing page (see second screenshot). The McAfee cart offered the usual choice of Visa, MasterCard, American Express, PayPal and others. 

Opportunity for financial institutions: Assuming you can swing a deal with McAfee that requires no out-of-pocket expense, offering your customers a year's worth of anti-virus protection is a win-win. The primary downsides are a few extra calls to customer service and a few irritated existing McAfee customers who do not qualify for the freebie.

Bank of America logout screen (21 Oct 2009; 7 AM Pacific)

Fine print on bottom of page above:
This exclusive offer is available only to Bank of America Online Banking customers. Online Banking customers receive McAfee Internet Security for PC free for 12 months, a $69.99 value. At the end of the 12-month period, Online Banking customers are eligible to renew for another 12-month period at 50% off MSRP or $34.98. Customers with a current McAfee subscription are not eligible for this offer. Bank of America reserves the right to modify this offer and eligibility requirements at its discretion.

Landing page (link)

Same offer on BofA website (link)

Notes:
1. The service is currently offered at a discount at Intel's software store for $32.95 for one year for three users. Intel's offer was positioned via paid ad at the number-one position on a Google search for "McAfee Internet security."
2. For more information on online banking security, see Online Banking Report: New Security Techniques (Sep 2008)

A recent review of your account indicated that we are missing your date of birth. We use this information to help verify your identity. Please call us at the 1.800 Customer Service number on the back of your credit card so we can update your file.

I guess I can understand the bank wanting my birth date, but it brings to mind several questions:

1. Why are they asking me now? I've three accounts there, with one dating back to the 1980s. Is something wrong? Has my account been accessed by someone else? Then my more cynical side thinks, did this request come from the marketing dept. or the security folk?  Bottom line: the bank should provide a more detailed explanation via a "more info" link.
2. I have to CALL, really? Why can't I do this online? Will I have to endure a cross-selling session when I make the call? Will I have to go through the entire phone tree to get to an operator? The least the bank could do is provide a direct line for the task.

The whole thing seems like a ridiculous waste of time. A five or ten-minute journey through call center menus in order to provide six numbers to a live operator. Plus, won't this extra call-in requirement drastically reduce user response? 

Bank of America interstitial after logging in to online banking (14 Oct 2009, 5 PM Pacific)