Tag: digital transformation (Page 1 of 2)

What’s Up With This Apple Savings Account?

December 10, 2022 / Joe Winn / 0 Comments

Update 8/2/23: $10B in deposits. That’s it. That’s the update. Look to your mission for ways to make your credit union appealing. Because Gen Y (and Millennials, and Gen X) is fine with their iPhone doing it all.

Update 4/20/23: It’s officially here. And with a 4.15% APY, their savings has got yours rate-beat. And integration beat. And “get it on the device you already use” beat. Yet those aren’t even the important points. So let’s talk the why and how your credit union can “think different”.

This started as a LinkedIn post. However, as I kept adding explanations, it became obvious…this is an article. As an industry, credit unions need to understand what is and isn’t going on with Apple’s savings account. And what that means for all of us.

I Speak Apple

Two silhouette heads with iPhone and piggy bank inside with speech bubbles — *My typical credit union conversation.*

If you’ve spent any time here, follow my Twitter handle, or spoken to me, you’ll know I’m really into Apple. If you have a question about a product, historical factoid, version release schedule, or even specs, I can tell you straight from memory. (There’s even a security fix credited to me!)

Why do I share that? Because I want you to realize that I’m possibly the most qualified person in our industry to talk about the “doings of Apple”. I’ve connected Apple to credit union insights in 49 separate articles (making this one the big 5-0!).

In 2019 I claimed that Apple reinvented (improved) the credit card. Back in 2017, I started the conversation on Apple Pay Cash (now Apple Cash), their first foray into a “savings account”, and warned that they became the face of your institution for members.

Last year when Apple Music added both Lossless and Dolby Atmos to their service, I asked credit unions if they were delivering hi-res value to members. Just having music, I mean, checking accounts, was no longer enough.

When others start talking about Apple’s banking intentions, I listen. And now we’re here to clear up any misconceptions, while also highlighting the enormous challenges (and opportunities) this adds for your institution.

ApplePay & Your Credit Union

Mobile Payment Cash Exchange Future — *The future of payments*.

Suffice it to say, Apple is big enough that when they do something, or even just hint at it, industries react. ApplePay was introduced in 2014. By January of 2015, I was warning that it was the new standard.

If someone had a good experience with that service, they would prefer to not go backwards in technology and convenience. (“Luckily” for credit unions, it wasn’t always a good experience yet because of point-of-sale incompatibility and untrained staff. Not anymore.)

At the time, I was impressed by how fast many credit unions stepped up and made their cards ApplePay compatible. In some ways, it was laying the groundwork for handing your member’s PFI over to someone else (that’s just a nod to the cleverness of Apple’s slow, deliberate, and integrated approach to things), but, ah well.

Despite these risks, ensuring your cards can be added to mobile wallets is necessary.

The Apple Savings Account (it’s just Savings) has both nothing and everything to do with this history.

Savings. By Apple.

Innovation - Mindshare - Profits: This is the (Apple) Way — This is the way.

A recent article in CUToday implores credit union executives to “pay attention” to Apple’s banking intentions. It has many great points about the merging of savings and checking accounts, the ease of digital account opening, instantaneous access to rewards, and more.

“[I]t’s the full spectrum,” Richard Crone explains. He’s right. Apple strategically creates products and services which start out as separate initiatives, but then slowly (and sometimes unnoticed) merge together. Before you know it, they just took over an industry.

Apple plays the long game, and their end-goal isn’t market domination. It’s mindshare. With a huge profit margin no one else can match. While other companies sell far more phones, Apple rakes in over 90% of the profits for the entire industry. Can you name 5 other smartphones?

You can bet this is their approach to banking, too.

The Pre and Post Apple Effect

Old and New Computers - Before and After Apple — *Remember boring beige computers?*

Apple also redefines traditional categories. There were computers, but then came the Macintosh. There were music players, but then arrived the iPod. We had plenty of smartphones, but we didn’t have an iPhone.

AirPods revolutionized what we thought headphones could be. The Apple Watch made a smartwatch practical, fun, and a crucial tool in monitoring and improving your health.

Now take a step back: All of these products complement each other, with subscription services to overlay. AirPods auto-switch between every Apple device you own. iCloud+ (starting at $0.99/month) links data from Apple TV (have you tried AppleTV+?) to your Mac, while adding privacy protection and more.

Apple Wallet is their “life” hub. It’s a banking app, but it’s also a platform, where you can access cards from other institutions, including your credit union, plus employee badges, mass transit passes, Disney World Magic Bands, even your car keys and ID.

And you just noticed that Apple is slowly replacing your physical wallet. No way you’ll go anywhere without your iDevices now!

Plus, did you know that your iPhone can be a merchant payment terminal? Yep, with Tap to Pay on iPhone, you can accept purchases by letting people tap their card, watch, or phone to yours.

Does that work with your business services? It does with Square. And I’ll give you one guess which app manages all that…yes, it’s Wallet. The same place you can deposit those funds into Savings, or pay for something yourself with the Apple Card.

Quietly, Apple has walked into the payment, savings, and budgeting space, from both the consumer and merchant perspectives. Innovation, mindshare, profit.

Apple & Your Credit Union: Bringing Clarity

Magnifying Glass on Crystal — *Crystal-clear. Because it’s a cry*s…

There are a lot of similar-sounding services, platforms, and even physical cards. So let’s clear up any misconceptions (including in that above-linked article):

When this article was originally written, it had yet to launch. Now, as of 4/17/23, it’s available to sign up (in less than a minute). Compare that to adding new accounts for members at your institution.
Apple’s savings account will be limited (initially) to users of the Apple Card, which is credit. Can’t qualify for the credit card? You don’t get a savings account. This will likely evolve over time, but for now, they want the tie-in, which makes sense.
To be clear, Apple isn’t a bank. These accounts and services are through a partnership with Goldman Sachs. This should remind you of a past article. There’s more, but that’s for the next section.
A lot of different and related services are mentioned.
1. ApplePay is the platform that lets you digitize debit and credit cards (like the ones at your #creditunion) and use them from your iPhone, iPad, Mac, or Watch.
2. Apple Cash (formerly called Apple Pay Cash) is the virtual account powered by Discover and Green Dot Bank where your Daily Cash (rewards) go.
3. Wallet is the app, but also the platform, and it requires an iPhone.
“Supporting” Apple Wallet at your credit union should already be done and just lets members pay with your cards through their iDevices. This has absolutely nothing to do with their savings account or the Apple Card. Consider this your lifeline to digital audiences, nothing more.

Even more simplified:

Apple Savings. A huge threat to your debit usage.
Apple Card. A credit card that makes yours look old.

Digital, Sure. Also, App-Based.

Wallet App - Cards and Keys — *There’s an app for that. Wallet.*

All of this, of course, works through a single app, Wallet. As Crone explained, “the enrollment happens online”. In fact, everything happens digitally, on a single screen. When credit unions talk about simplifying applications or streamlining account openings, it has to be this easy.

You can’t do it alone. And that’s ok. I’ve discussed how to address this before. My company even has some ideas.

To Succeed: Be A Credit Union

Diverse People and Heart — *You know this part*.

Bottom line: You can’t beat Apple at their own game.

But that’s ok, because offering credit cards and checking/savings accounts has never just been what your credit union is about…right?

Compete by living your mission.

Earn loyalty by standing up for members.

Keep it simple by offering the best available digital services.

Market the difference, not the similarities.

Apple and other companies will continue to innovate simplicity and creep into more industries. The path for survival, and potentially even great success, is in knowing your why. Remember, Apple doesn’t need to be the first, nor the largest. They just want to be the best for their customers.

And isn’t that a pretty credit union-esque thing to be?

Not All Change is the Same – Credit Union Edition

September 21, 2021 / Joe Winn / 2 Comments

Originally published on CUInsight.com

How often do you hear advice suggesting you “make a change” or “step out of your comfort zone”? There’s a reason…consistency might be easier, safer, and reliable, but it doesn’t promote growth. Making a change is good, if it’s in the right direction, for the right reasons.

Yet not all change is the same. And that’s ok. So how do we make sure our diligent effort produces the best (or any) results? By understanding the kind of change you need.

Away Means Different Things

Joe Standing on Rocks — *Joe following a 30 year tradition of climbing rocks.*

Regular readers know I love to travel, especially to see friends who happen to live in really cool places. They’re no longer off-limits (thank you thank you thank you vaccine researchers and nurses!). Far off places, daring sword fights, magic spells, a prince in disguise!

My last post came from the seaside deck of a Rhode Island home. I had a lot to say about creativity being driven by a change of scenery. Perhaps after all our time stuck in the same environments, variety is a hot topic. Consider this, “change stuff, part 2.”

Since that trip, I’ve done more traveling! Crazy, I know. When in RI, I can count on connecting with kids, participating in impromptu art projects, and riding around in Teslas. Really, it’s a tough life. And the inspiration I get from the experiences are unique.

Last month, I reconnected with one of my best friends. She lives with her boyfriend and foster rabbit north of Atlanta. They’re child-free, big on hiking, RVing across the country, kayaking, boating, and cars that go fast while making satisfying noises.

Young Deer — *As seen on one of our trails.*

It’s a vastly different environment. Their neighbor even built a Miata race car! (I was able to ride along, which was a blast) We also had the chance to go on longer hikes through nearby National Park sites, see deer, and jet boat around on big lakes. More change, totally different.

You Get What You Experience

Each of these trips provided a separate set of insights. For the former, well, you saw my writeup. From the latter, I had less “downtime”. Whether playing complex and awesome board games or learning how to engineer a solar system into an RV, we were always active.

Turns out, I needed a bit of this, too. Sure, I didn’t sit down on my computer and draft out posts as much (maybe not exactly ideal), but we were tending to bonds built over many years. Had I gone with the same expectations of seeing nephews, I’d have been really disappointed.

It’s a bit like traveling to Disney (which I also did in this span). No one goes there to “relax and settle down for a while”, as much as their marketing might imply you can. Many know the feeling of needing a vacation from that vacation. Still fun, just totally different.

Be open to getting the most out of every experience while pushing expectations aside. Now I’m starting to sound like my Tai Chi instructor. Maybe that’s not a bad thing.

Right Change. Right Place. Right Time.

Each day, I read articles about credit union evolution, digital transformation, and emerging competition. Most of these pieces miss the point, which I touched upon way back in 2016. Exponential change means these ideas are already outdated.

It would be like me traveling to visit my nephews expecting to engage with them as they were during my last visit…18 months earlier. Or planning to do the same things with friends, even though they moved from one side of the country to the other.

Or, what any Disney person can understand: Planning to do a theme park with a set schedule for every attraction, show, and food stop. I point and laugh at those people. That’s too stressful, and it’s just not going to happen. Things will change, and you’ll have to adapt.

Start With Your Need

The best industry articles encourage leaders to focus on the mission, understand their staff and members, and recognize the needs. Individual product choices, marketing decisions, and strategy plans follow from this analysis. (We do the same with potential and existing clients.)

Passionflower and Bee — *Keep your goal in focus.*

What’s the change you need to serve your need? Sure, credit unions are evolving. So is everything else. How can you best evolve to meet the needs of your members today, tomorrow, and maybe next year (looking ahead really is hard with exponential change)?

For example, tackling your digital transformation is essential. But, deciding to add a chatbot because it makes your service better for “young people” or “on the go” is the wrong approach. Just ask Anne Legg of THRIVE, who specializes in that data side of things.

Looking at your services lineup and coming to the conclusion, “there’s just not enough member choice”…well, that’s likely not a great formula, either. Rick Leander at LFB Holdings understands that more progress can come from subtraction, not addition.

Find the change that gets your institution on the path it needs. Is that from insights gained while watching the sea roll by in the Northeast? Or more literally, found on a trail in a National Park? Maybe the bustle of Disney provides the right kind of change.

Next time you’re looking to make changes at your credit union, approach them from a range of perspectives to ensure they’re both the right things and for the right reasons. Because goodness knows change is only going to continue.

That might seem a bit outside your comfort zone. Perfect, you’re already on the right road.

5G Doesn’t Matter

January 12, 2021 / Joe Winn / 0 Comments

Originally published on CUInsight.com

Hey again! It’s your friendly neighborhood Credit Union Geek, talking about the latest webs making their way through your community. Silk-free, of course. We don’t need those strands sticking to everyone. This is an invisible new tech that could change everything.

Or it could just be an evolutionary improvement that enables new capabilities for a range of industries. You decide.

Today we’re going to talk about 5G. Some say it will revolutionize banking. And e-commerce. And medicine. Basically, everything!

Others think it caused COVID-19. They’re wrong, just to be clear.

Join me for a few geeky minutes and we’ll figure out how 5G may, or may not, affect your credit union. And how you can prepare!

What Is 5G?

This isn’t a place to go into deep technical dives. Besides, there are people out there far more qualified than I to lead you on that journey. You want to know the basics. Here we go.

Take out your phone. Maybe it’s an iPhone. Perhaps it’s a Samsung Android-powered device. Whatever it is, I guarantee it connects to a cell tower to work. Sure, with work-from-home, we’re using a lot more wifi, but that doesn’t mean mobile providers are sitting still.

Take a look at the top of the display. There’s some signal bars and maybe a network name. Next to it, you might see a “3G”, “4G”, “LTE”, or something similar. (AT&T users probably see “5Ge”, which is a total lie done for marketing purposes only)

Most of the time, our devices are on an LTE network. That’s considered a 4th generation wireless technology, thus, “4G” is the same thing. It’s fast and does a pretty good job of working where we commonly go.

Sidenote: Yes, there are variations of 4G LTE like LTE Advanced, but remember I said this was a basic overview?

Like most technology, LTE was never seen as “the end of the line”. Even while it was being deployed, companies were working together to design the next generation of cellular tech. What came out of that collaboration is what we now call “5G”.

5G cellular technology promises a few things:

Faster speeds
More concurrent users
Lower latency
Improved security
Potential interference with weather satellites (it’s probably a nonissue, but also an interesting physics primer)

Ok, barring that last one, those all seem great. Let’s do it! I’m sure there’s no challenges standing in our way…

Challenges of Implementing 5G

Cell Tower Antennas — *A lot of these to climb and upgrade.*

Well, I did bring it up.

Like LTE’s deployment before, blanketing a country (or world) in a new technology is a huge undertaking. Even for companies like Verizon which make a ton of money, you’re still talking enormous investments in equipment, people, licensing, and sheer time.

Bottom line: Every single cell tower (and its “backhaul”, or lines connecting it to the world) needs to be upgraded to support 5G. And that’s not all.

5G is actually separated into two general categories, mmWave and “regular” 5G. The latter is mostly a “bolt-on” upgrade to existing towers, using similar frequencies and offering similar range. But they’re also only slightly faster than what we have today with LTE.

2023 Update: Ok, technically that’s not accurate. There are now 3 categories of 5G, with “midband or C-band” joining forces with mmWave. C-band gets you faster speed and typical cell tower range without needing to be right near one of those roadside “nodes”. Verizon requires you be on their higher-end Unlimited plans to access this signal.

The 5G you see promoted by networks as “nationwide coverage” is the latter (including C-band, if not Verizon). Expect the improvements in each of the previous categories to be…a bit.

The big benefits come from mmWave, but it has a downside: Range. Just like an AM radio station carries for what seems like forever while an FM station goes to static quickly, the higher a frequency, the shorter its range. So short, it could only be a city street corner.

Yes, that means you need a cell “tower” (they’re smaller) on every block, and then multiple ones for a building.

Why bother?

Because mmWave 5G is fast. And extremely low-latency (quick response between device and destination). This can enable new uses, from drones to live VR and more. Right now, we are still figuring out what opportunities it opens up.

2023 Update: With the rapid rollout of C-band, you get many of the benefits of mmWave in a wide range of locations. Not quite as fast, but better than 5G that runs alongside existing LTE bands. It’s available for over half of Americans with compatible devices, and expanding quickly.

One More 5G Challenge

Girl with iPhone — *Great photos. No 5G.*

Your current device may not receive 5G signals. Unless you have a 2021+ Android or iPhone post-12 series, you’ll never experience the benefits of 5G. Sure, you will have a less congested network as other people transition to 5G, but you’re stuck on 4G LTE. Enjoy the “slow” lane, suckers!

Needless to say, from your perspective as someone not involved in the deployment of a nationwide network, consumer adoption is your greatest obstacle.

Ok, say we’re enjoying the iPhone 14 Pro right now. And I happen to live somewhere that 5G mmWave is accessible (I actually do), plus, I choose not to use my home wifi (it’s about the same speed). How can this make my credit union experience better?

Uses for Credit Unions and Members

Finally, why you came to this party! And after all that education, you’re going to hate this answer, but it’s my responsibility to share it with you.

None.

There is no realistic use of 5G now or in the immediate future for credit unions.

“But I keep seeing articles saying how 5G will change the way credit unions operate!” You’re right. I applaud these people for looking ahead with new ideas. Yet none of them are dependent on 5G. I’ll address just a few here:

Improved biometrics for security: Position data of a device takes a tiny amount of information to store and process.
- With an iPhone, you can even see data on every step you’ve ever taken in Settings/Health/Data Access & Devices, then choose your phone or watch.
- This information also requires permission to share, and how many members will say yes to their credit union seeing their motion activity?
Real-time language translation: Your iPhone does this right now, with the option for it to be totally on-device. No data connection even necessary!
Facial recognition: The idea is that your system can get a stream from the camera to identify the user and their facial expressions.
- First, modern iPhones do all this on-device. Today. No need for 5G. Second, people aren’t fond of sending video of them without explicit permission (that’s why your phone now shows a green dot when it’s recording)
- And third, you’re now responsible for securing member facial data and all the legal/regulatory issues associated. Any volunteers?
- That’s not to mention the enormous data usage your app would now use, along with members wondering why your app asks for permission to use the camera.
Video chat with members: Yeah, you can totally do that right now with WiFi and LTE. Don’t you already?
Faster loan approvals: What’s the slowest part of your loan process? The sending of the data, or the processing on your system (or the manual work from your loan officers)? Yeah, sending documents a half-second faster won’t change this.
Reduced costs for CU: The perspective here is that you don’t need to build your services for slower devices. This confuses two kinds of performance, data connection and processing ability. 5G doesn’t make a phone load your app faster; a better processor and more RAM does.
Serving the unbanked: With 5G, you’ll connect with more rural and low-income people through a fast connection…right? Maybe, someday. For now, 3G loads your app just fine. Look to other strategies to serve the unbanked in your community.
- This is a whole separate discussion on broadband definitions and expanding access to all Americans. Your credit union can support these policies, but they have nothing to do with 5G.

We could go on, but I think you get the point.

Instead of looking at 5G as this revolutionary change to how you can do business, let’s look at where you aren’t meeting member expectations today. Because that’s the most important path towards becoming a better community financial institution.

Lessons From 5G

Old Black Phone — *Really, you’re just phoning this stuff in.*

Since we’ve already established that the tech itself has minimal impact on your operation, what can we learn? Well, two things come to mind:

Data management
Continuous improvement

Data Management

5G is all about moving data more efficiently. At your credit union, your focus needs to be on managing all your data more efficiently. That way, you can access what you need, when you need it.

You’ve probably heard about “data lakes” and “single source of truth”. In fact, our own Learning Library is gearing up to cover these topics in depth. A friend in the industry, Anne Legg, is all about that process. Other connections at Arkatecture help make it happen.

It’s essential to improving your member experience.

Which brings us to the second lesson…

Continuous Improvement

Running Along Road — *Just keep running.*

Mobile providers aren’t satisfied with “same”. To grow revenues and attract new customers, they look ahead to how they can continuously provide a better service. Sure, a lot of it comes down to marketing, but if you don’t give marketing anything to promote, it’s more difficult.

5G comes at an enormous investment from the providers and chipset manufacturers. Then you have to redesign devices so they’ll work with the new tech. It’s way more complicated than you’d expect, but it continues the onward march of technology.

Yet being able to say your network is faster, you can do more with Verizon (or T-Mobile, etc.) than ever before, and that they are connecting you in new ways has value. And then they deliver on the promise with actionable results (like blazing-fast speed tests!).

5G May Not Matter, But…

So, how are you creating your own “5G improvements” at your credit union? What new ways can members interact with their money, connect with your team, and work towards a more financially free and empowered life?

Sidenote: This gave me major deja vu to the Are You Bluetooth or Wifi? follow-up post from what feels like ages ago!

And what are you doing to bring all your data together so anyone can get the info they need? Yes, whether they are using wifi, a back office computer, 4G LTE, or the fancy new 5G mmWave on the corner of fast and blazing fast.

Your mission is your 5G. And better access for all sounds like a good benefit to me.