Frictionless Payments And Top Mobile Banking Innovation


Banks are turning to digital technology to enhance the customer experience — and reduce payment friction — in an effort to boost top and bottom lines.

In meetings and calls with analysts last week, executives from top banks such as Bank of America, JPMorgan Chase and Citi — along with payment companies such as Visa — explained how they are leveraging technology to drive innovation.

Bank of America

Bank of America seeks to have customers complete tasks remotely: “Everything that you can do physically in our organization, you can do on the digital platform or via phone,” President of Preferred and Small Business Banking at Bank of America Dean Athanasia said at the Morgan Stanley Financials Conference on Tuesday (June 12). In fact, Athanasia said that 26 percent of the bank’s sales are digital, and the goal is to get that up to 50 percent “and keep driving that forward” in the future.

In terms of mobile initiatives, 1.3 billion transactions are going through mobile channels a quarter. And Athanasia reports that only 25 percent of deposits are happening over the counters. “That’s costly to us,” Athanasia said. “So, we expect that to go down, either through a phone or through the ATM in the future, and again, at additional cost savings for us.”

In addition, Athanasia said that the bank has enhanced its mobile app with Zelle. And It has rolled out cardless automated teller machines (ATMs) and advanced centers without people over the last 18 months. But, in terms of branches, the bank seeks to grow its physical footprint in new markets such as Denver, Indianapolis, Minneapolis and Salt Lake City. The bank is also heading to cities in Ohio as well as Pittsburgh.

JPMorgan Chase

While JPMorgan Chase has invested in technology for years, the focus has so far been to help traders, portfolio managers and others inside the bank. “But digital is just the reverse of that, which is taking all that stuff and being to give it to the clients,” JPMorgan Chase Chief Executive Officer of Asset and Wealth Management Mary Erdoes said at the Morgan Stanley conference on Tuesday (June 12). “And that’s really our journey, is to be able to say, ‘let’s give you your data back in a way that helps you. That makes you smarter.’”

The idea is to “play back everything we can back to them,” Erdoes said. “They can make wiser decisions in their lives and hopefully end up with our goal for them, which is at the end of the day to have a better, healthier, happier retirement.”

In terms of physical locations, Washington, Boston and Philadelphia “have renewed exciting energy for us inside the firm, because they are places that we haven’t had a presence.” And, even in the digital age, Erdoes said that customers might want to visit a physical branch for advice.


Citi has been ramping up its development of its mobile apps: “The pace of new features on our various mobile banking platforms increased dramatically over the past 12 to 18 months,” Citigroup Chief Financial Officer John Gerspach said at the Morgan Stanley conference on Wednesday (June 13.) At the same time, the bank is making less investment in its digital footprint.

While the bank still sees “a lot of value in branches,” the bank anticipates fewer branches.  And “they’re going to be smaller,” Gerspach said. “They’re really going to need to be in areas of great impact.” To that end, the bank has focused on larger metropolitan areas because it believes they are the most impactful there. In addition, the bank has rolled out smaller branches because of digital technology. Additionally, as the bank continues its move into digital banking, it has put more “of an emphasis on being mobile first,” Gerspach said.


Visa Inc. said its moving beyond face-to-face transactions by becoming the rails to eCommerce, mCommerce transactions and peer-to-peer (P2P) transactions. In addition, Visa is becoming the rails for government-to-consumer transactions (G2C) and business to business (B2B) transactions.

“Our rails have gone from something that you could only access with a physical card, to being something that you can access with a digital credential secured by a token that can be embedded in any device,” Visa Inc. CFO Vasant Prabhu said on the William Blair 2018 Growth Stock Conference Call on Wednesday (June 13). “Essentially, what that means is any device can be used as a way to pay or a way to be paid. So, you can see again, the flexibility that we’ve been able to bring to the ecosystem.”

In the future, the rails continue to make the payment experience more frictionless. The company is moving from the swipe and dip to contactless and QR codes in other parts of the world.

“We’re making the whole experience easier and frictionless in the face-to-face world,” Prabhu said. “And in an eCommerce world, something we might talk about, the move to a single pay button and better, faster and more frictionless authentication technologies like 3-D Secure.”