Where is the HSBC Mobile Offer?

The results of the election in the UK have not yet been called, which means I still can't talk about some of the things I've got backed up. In the meantime, Aden Davies (@aden_76) provokes me that I should "write a constructive post with a dedicated URL to get us off the ventilator". So let me use the election hiatus as an opportunity to comment on mobile banking, and more particularly, the lack of it at HSBC.

A week or so ago, I downloaded the NatWest iPhone banking app, apparently the only banking app in the UK on iPhone at present. Why this is so I have no idea - in other countries like Australia, you're almost not a bank unless you have an iPhone app. Anyway, I downloaded the app because I'd heard rumours that you could use it to access your HSBC accounts if you had a NatWest account. This is true, actually.

I am a long-standing HSBC customer, and I don't mind admitting I'm a bit of a fan of Premiere. I love that I can move money around the world free of charge with instant settlement, and I like it that you get all these special spaces in branches. I even like the internet banking service, which, whilst its nothing that special, is perfectly functional and does everything, almost, that I need.

I am, however, at a loss to understand the complete lack of a retail mobile banking application. Not just for iPhone, but at all. What is going on HSBC?

I have a feeling i know the answer though. I'll bet that someone, somewhere, has decided that mobile is strategic, and therefore a global, multi-market solution is needed. I'd guess the whole mobile thing is so strategic to everyone that a big-bang approach seems the only way to make a splash. Never mind that you can build iPhone apps for practically nothing these days, and never mind the fact that everyone else has a mobile offering, even if its not on iPhone. I mean, even the DWP has an app these days, and we're the government.

The NatWest app, by the way, is pretty lacking in functionality, and it is based on the generic service that banks in the UK get from Monetise. They're the same people that run the Link ATM network, and apparently the app uses that transaction network to get its data. In other words, there's no integration or effort required to get the Monetise app to work for a particular bank, and is the reason that I can use my HSBC accounts in the NatWest version.

Anyway, whilst a mobile app from HSBC would be nice, what is striking to me is that the bank hasn't recognised that there is a need to get early experience in this space if you want to take the lead later. Shoving a poor application out the door - like NatWest have done - is teaching them valuable lessons about how customers like to use Mobile.

Moreover, they're building a committed and loyal base of customers from the ground up. These are early adopters who have no choice but to open an account if they want to bank on iPhone. There are only so many early adopters available in a given market, and NatWest are getting all of them. Typically, somewhere between 15% and 18% of any audience will bother trying something new - but they're the ones that will tell everyone else about their experiences. Recruitment of these people is the key to building a base.

And lets not forget that, as the only bank with an iPhone app in the UK, Apple have been shoving the app in front of everyone through their TV commercials featuring "there's an App for that".

Of course, all this is pretty incidental to the real business of retail banking if all you're doing is offering transaction histories and balance checks, which is almost all the NatWest app does.

But consider this: if all the early adopters are somewhere else, and then you decide to drop a major game-changing new feature in, who will be around to talk about it? Who's going to tell their friend and friends of friends how their experience has changed?

The point of mobile banking, really, is what the next generation of apps is going to be able to do. Contactless payments, point-of-sale loans, banking related geo-games and so on and so forth. The potential for integrating banking services into the day to day of life is the game changing play that mobile enables.

Too bad if you haven't got any customers willing to try those features though. Hurry up HSBC, if you want a shot at it.

Update: Finextra have picked this up, and and Brett King add his thoughts here as well.

Update 2: I was wrong about HSBC and their lack of mobile. They do have an offering for supported handsets (not iPhone, though), powered by Monetise. The link is here. However, I have to say, at this point, that I couldn't find out how to navigate to that link from any of the products I have, and furthermore, mobile doesn't come up in their search when you ask for it. Despite all that, I think I stand by most of the comments in my post.

Comments

[Brett King]

James,

It would be nice to blame a global, multi-market strategy as the cause for the delay, but in truth the issue is probably far simpler. For one thing there is no mobile banking department in HSBC, either UK or globally. And within the departments that are responsible, i.e. multi-channel/direct or similar, budgets this year are already allocated on other projects. At the start of this year mobile was seen as a nice to have, but not a priority on the multi-channel front with OneH looming as the dominant project. Marketing got a bunch of $$, and other budget was squeezed because of the GFC.

The issue with HSBC, like most banks today, is that the organization structure does not match the reality of customer interactions. Thus, organizational inertia, existing budget line item structures and departmental competition, actually frustrates customer initiatives. The organization structure is broken and needs a real rethink. However, while HSBC is posting record profits, the 'inertia' for such a change will continue to elude customer experience champions.

BK

[James Gardner]

Brett, that's a good argument, and it fits with what happened at Lloyds TSB too.

However, here is the main point - we - the Goverment - have an iPhone app. We are *also* in a budget constrained situation and we *also* don't have a mobile department. How, then is it possible we have an app and HSBC don't?

The idea that you'd need a massive amount of money and a massive department to execute is clearly false.

[Brett King]

Traditional bankers at the helm who don't understand changing customer experience - clearly...

There is no excuse for HSBC not to have both app and mini-browser support for customers as of today, nor a strong organization-wide support for social media - neither which they have today.

BK

[James Gardner]

I can't agree with your remarks Brett. I think they do a wonderful job
of customer experience - at least for me - in so many cases. That they
don't have a decent mobile experience presently is certainly an issue,
but lets face it, we're talking about a very, very successful bank. The
suggestion that their leadership is somehow out of kilter entirely with
what customers want is obviously untrue. If it were - why are they
doing so well?

I think most people in the echo-chamber - that's you and I and everyone
else who comments on the banking industry - generally fail to look at
the banking experience from the point of view of those who don't think
about banking every day. For them, I rather think they might get
annoyed from time to time, but the experience is good enough. Who wants
to care about their banking relationships anyway, if you're a customer?

[Simon Dickson]

Totally agree with your perspective here, James. But I'd settle for a better web interface at HSBC for now. It's totally infuriating how many screens I hit where there's only one clickable option.

I use HSBC for my business banking, and First Direct for my personal. First Direct gets it so much more right.

PS: Great line about the need to gain early experience in order to take a lead later. I'm in total agreement; but it doesn't sit too neatly with the government's web rationalisation model. I blogged about it a little while back:

http://puffbox.com/2009/11/18/microsites-make-perfect/

[Trevor LaFleche]

Having had a chat with HSBC a while back on this topic they pointed out that FirstDirect was their innovation brand and that they had rolled out an iPhone version of their internet banking site a significant time ago. (There is little need for an iPhone app if you can reuse/skin existing internet banking).

While a number of banks rushed headlong into WAP banking, Second Life, etc. I consider the innovation of HSBC to be a bit more useful (Global balances via linked HSBC account on one screen). Instant international balance transfers, etc. than the innovation that is popular in the press.

Innovation does not have to be technically wiz bang stuff but should be a meaningful adaptation of processes and capabilities to deliver value to the customer.

Sometime it is a tradeoff between what the customer thinks they want and what can be brought to market at the right price/cost. Has the lack of a removable battery stopped the iPhone being successful? Didn't the customer WANT that? Maybe it was what industry pundits said the customer wanted and a lack of leadership and understanding of the customer that let them listen to the pundits.

Maybe HSBC has an insight into the costs/benefit of mobile banking that is a better appreciation of the real story than many of the emperors' clothes versions that we hear from other people.

[Dave Birch]

"(There is little need for an iPhone app if you can reuse/skin existing internet banking)."

Totally disagree. The BA iPhone app is a much better way to check in etc than BA web site on iPhone. The web site and the iPhone app are consuming the same web services, so it's no extra effort on the server side, but an app shows that they care about their customers I think.

[Aditya]

I disagree on the extent of advantage that Natwest is building. The early adopters may take the pain of changing the Bank to get into Mobile Banking but the people to come later won't. For them Mobile is not the absolute KEY aspect of banking that drives their selection of the Bank. Instead, they would rather hear stories from early adopters and bear a bit of pain as they wait for their Bank to come up with an app. So yes Natwest has an advantage but not as much as made out in the post.

[Simon]

HSBC do offer mobile phone banking powered by Monitise Plc :

http://www.hsbc.co.uk/1/2/personal/current-accounts/express-banking/monilink#top

http://hsbc.monilink.co.uk/hsbc/info/termsAndConditionsOfService.html#service

[Simon]

And here are the Monitise websites :

http://www.monitisegroup.com/

http://www.monilink.co.uk/

http://www.monitise.com/

http://www.monitiseamericas.com/

[Chris Skinner]

Good debate guys and thanks for starting it James

My take is that there were plenty of mobiles around before the iPhone, but the iPhone has revolutionised that market by enabling developers to offer apps.

iPhone apps are far better than websites, skins or other forms of access, when designed well (note your NatWest comment James).

Therefore, banks of the future will be those that design for the easiest forms of access - such as the iPhone - with specifically designed apps.

Having said that, there will be something after the iPhone - who knows what? - so really innovative banks will continually be ready to leverage and exploit whatever platform is winning.

The fact that most (UK) banks do not, is a real indictment ... look to Spain (Banco Sabadell for example) and you find its totally different.

http://thefinanser.co.uk/fsclub/2010/04/spanish-banks-leading-in-innovation.html

Chris

[James Gardner]

Thanks for pointing this out, Simon. Have updated the post to reflect
it. But you know I can't find a way to get to that link from the
products I have, and also, it appears that the service doesn't come up
in search either...

[Simon]

One of the links I provided linked direct to HSBC's MONITISE mobile phone banking service on the HSBC website but that link now links to the HSBC home page instead.

I think it might therefore be reasonable to assume that HSBC is updating its Monitise mobile phone service and is updating the HSBC website accordingly.

I personally think Monitise could become a big global company. I am of the opinion that its websites are therefore worth reading by anyone interested in buying Monitise shares
which are listed on the AIM market of the London Stock Exchange :

http://www.monitisegroup.com/

http://www.monilink.co.uk/

http://www.monitise.com/

http://www.monitiseamericas.com/

[Simon]

Herewith another link to the HSBC mobile phone banking service :

http://www.hsbc.co.uk/1/2/personal/current-accounts/express-banking/monitise;jsessionid=0000-UJWLq9wCkrbl1cNXDXOGNn:14f64pvcv

Why did you not check your facts before blogging false and misleading information?

[Simon]

I would also respectfully mention that I have been reliably informed that contrary to your claim, The NatWest iPhone App (which is powered by Monitise) is not lacking in functionality :

http://www.natwest.com/global/media/y2009/m-7.ashx

PS I gather you are the former head of innovation at rival Lloyds TSB!

[James Gardner]

Gosh, vehement! Is it possible you have a more than passing interest in
Monetise for some reason?

[Simon]

The above reply should have read "In reply to James Gardner".

[Simon]

It's spealt Monitise.

I am certain I am not alone in thinking YOU have more than a passing interest in blogging false and misleading information about your former rivals for some reason.

[Simon]

For the avoidance of doubt, my reply timed at 02:35 PM should have been headed :

Simon said in reply to James Gardner...

[Stephen]

Wow, what a debate, and a great discussion.

I am not an iPhone user and my bank does not provide any mobile banking capability at all.

Lots of things to think about here though e.g. first mover advantage, early adopters, market share of Smartphone OS, cross platform development, features (payments, cards, balances, etc), also perhaps the need for inclusiveness e.g. do not exclude users by not supporting their phone etc. Indeed, start small, learn, and think big? Versus getting it right and getting it done?

I noticed one bank engaging on a branch closure programme, saying a shift to other methods including mobile was a driver, so I suppose new channels could also help with cost reduction, customer service and possibly some customer retention if aligned correctly.

And of course mobile payments will impact many business models.

All in all, a very fast moving and fascinating space.

[Thomas Barker]

@Chris - The iPhone was actually late in allowing developers to build software, J2ME & Series 60 were around a long time before it. Where it really succeeded was in getting a product unique enough [e.g. usably big screen + gesture control] to stop the mobile operators from crippling it.

My laptop, my phone, my desktop etc are varyingly sized Screen-Connected-To-Internet devices. You ought to be able to expect an internet-aware company to build out to any new "screen" simply because their customers want to use it. It shouldn't be a "strategic" decision.

New products that take advantage of location data, bluetooth, etc need careful consideration, but just adopting a new form factor doesn't.

Interestingly, looking at the Android Market, there are several mobile banking apps that are not authorised by the banks they link to... They're just screen scraping! (Something that I think has lots of potential - http://thomasbarker.com/10/05/hotwire-your-bank )

Monetise look intriguing... I wonder how much of the heavy-lifting for banking "APIs" is done by third-parties rather than the banks. If I have a Link/SWIFT/Bacstel app - do I need a Natwest/HSBC/LloydsTSB one ?

P.S. I can vouch for James being a bona-fida happy HSBC customer. This is not a sinister plot to boost Lloyds :)

[Simon Cavill]

I'm sorry but all this talk of "innovation" in mobile banking from companies like Monitise is just putting lipstick on the very ugly pig that is the current payment and banking system. The whole monolith is stifling any real innovation. We built fully secure mobile banking systems at Logica in 1997/8 with a far more comprehensive feature set than is being offered now and built working contactless mobile payments in about 2000.

If you want to see the future, don't bother with with a dinosaur like Monitise - go to Kenya and look at M-Pesa. Vast numbers of people conducting millions of transactions through their mobile phones for personal transfers, retail payments, utility payments etc etc and soon pensions and civil service wages. Quoting from Dave Birch's excellent blog http://digitaldebateblogs.typepad.com/digital_money/

"According to the Central Bank of Kenya, payments worth around 1 billion Kenyan shillings ($13 million) per day were transferred through Kenya's mobile money systems in 2009, equalling the country's credit card transactions. The bank expects mobile money transfers to overtake credit cards in 2010. So this year, more money will move through new payment schemes created specifically for the mobile channel than through the payment card networks. That's an interesting cusp. Is this phenomenon only of interest to the developing world?".

Considering you still can't do anything like this on your mobile phone in the UK I think we have a long, long way to go... Within a few years, Africa will have a far more sophisticated mobile payments and banking service (including Gov payments and tax collection via mobile) than we could ever dream of over here currently.

[Danmux]

I think it is more simple than that. For a large bank in the UK, the numbers don't yet stack up. Remember that less than 8% of all UK online bankers have any kind of smart phone. It might not seem like it to readers of this blog. but smart is still only just crossing the chasm - the truth is that the ven diagram shows of all bank customers around 2% will be iPhone users (6% others including more Blackberry users - with Android catching up)

Obv there is no revenue in an iPhone app directly, the customer loyalty, and channel potential that better mobile tools offer, are not well proven yet.

When you combine a vague ROI with a typical big bank approach to new development, where they will be projecting costs of 200k + for a new WS \ security layer on top of the 80k app development, with the current fiscal situation, its no surprise that banks are employing an 'active waiting' strategy with respect to mBanking.

What is undeniable is the target audience is growing at a rapid pace. Because of this there is a real low end, agile opportunity to help customers and banks now.

[Paul Everett]

Absolutely Simon - goes hand in hand with how many emerging markets have skipped fixed line telephony and gone straight to mobile. It looks like they may skip using banks as well - a good McKinsey study on the potential for mobile operators to provide banking services in emerging markets - http://www.mckinseyquarterly.com/Marketing/Sales_Distribution/Capturing_the_promise_of_mobile_banking_in_emerging_markets_2539

"About one billion people in emerging markets have a mobile phone but no access to banking services; by 2012 this population will reach 1.7 billion. Today, only about 45 million people without traditional bank accounts use mobile money, but we expect that this number could rise to 360 million by 2012"

Is it really easier for a mobile operator to create a savings/payments/credit operation than for a bank to build a mobile app to give access to existing services? (One angle suppose is that you can see how this really would be a strategic decision for the mobile operator while it should be more of a no-brainer for the bank - but still the mobile operators seem to be moving faster)

[Thomas Barker]

@Danmux - I think Sun is claiming 70% penetration for J2ME. I know J2ME is clunky and not terribly flexible, but you don't need a particularly smart phone to check your bank balance. (You don't need a particularly smart phone to do location sensing, or cheque scanning, either.) Simon's right, big UK business's idea of innovation is releasing a product within a decade of it being viable - it's quite sad.