Meniga Blog

Australia - Land of Many a Banking Technology Wonders and Modesty

Branding seems to both rest on technology and grow from it. Last year we all watched the guerilla ad campaign ran by NAB and Bankwest's Happy Banking brand is going strong on both coasts.                                                                                        

Something else that struck us was the focus on transparency in the financial industry. To the consumer this means access to so much information that price-comparison-style websites exist around financial products -such as Mozo- and on the inside it spells an impressive amount of information born out of testing: clearly spelled KPIs, measuring every variable of the deployed technology possible and quantifying each opportunity while linking them to honest business objectives. That too is sadly sometimes missing in Europe.

With all that technology casually bettering the bank-client-experience running about you'd think that PFM is well established in the region and not only part of exciting announcements. You'd be wrong. Australia has been a pioneer in PFM with ANZ launching Money Manager as "PFM-long-ago" as 2008 world's second oldest PFM offering by a bank. Close to 2 years passed before any others followed suite with what some described as "shy offerings" - BOQ's My Budget, and a personal favorite of Meniga's: heaps! from KiwiBank and many a times it seemed like the Aussie Financial Industry was gearing up for a PFM explosion but it hasn't yet come. 

As we've seen before some markets are incredibly reactive once PFM redefines online banks -see the U.S., France or Norway- while others seem to be content in letting the early adopters have the market for themselves while playing the waiting game and having to follow when it becomes a customer demanded standard -e.g. Spain-. Australia has falled into the latter category but it has now stopped crying "Wolf!" and will indeed give the world a run for its PFM adoption money in the next 12 months with absolutely every financial institution having it on its immediate to-do list.

We met conservative banks and trendy banks, banks who emphasize the client relationship to the point of putting a lot of focus on the branch -and that seems to be a non-European reaction where direct banking is hailed as the be-all-end-all- and banks with more appetite for open end discussions about the future of banking than we can tip our hats to. Despite a lack of Fin Tech events in the area, -Finovate has yet to go towards Asia, NextBankAsia  has yet to take place but is promising- all of these institutions knew a lot about banking technology trends and an area where they keep their eyes open is the future of online banking so Meniga's Peace of Mind Banking has been very well received and has been the starting point of many a visionary talks.

From what we saw, Australians should be some of the clients least upset with their bankers because they are getting more technology bang for their aussie dollar than many of us for our long tried Euro.

Meniga's last days of wearing the "Finovate Best of Show 2011" crown

This past year has been great to Meniga and great to PFM. New solutions cropped up in many countries and even more have been conceived and chiseled and will start appearing in your Internet Bank before the first half of this year is out. 

2012 promises even more. Yes some major banks are struggling and even the ones doing well need to prioritize between many internal projects but it seems like exciting things are on the roadmap of every bank we've talked to. 

Internet Banking seems to slowly realize it is tired of being grey, functional and essentially boring and aspires to be awesomely user centric, utterly mobile, impossibly intuitive and ready to follow the user wherever he is and whatever he is doing. Will it succeed? In some banks it will. It may not be before the end of 2012 -or later- but chances are your bank's online face is going to be very different from what it has been so far.

Keep an eye on Meniga @ Finovate either in person or on Twitter and see what you think of what we have in store this year and if you like it, vote, we could do with a new crown!

The Big Account Aggregation FAQ

Many factors can make or break a bank‘s PFM offering, including Accurate Automatic Categorization of Transactions, Usability and Placement in the Online Bank. However, no other subject seems to have captured the imagination of bankers everywhere in quite the same fashion as the topic of Account Aggregation. 

Maybe the reasons have to do with how intuitively we all recognize the importance of account aggregation to adoption, retention and potential business benefits. One thing is clear - anyone who has ever been serious about using a PFM solution -whether an independent site like Mint.com's or Linxo.fr's or one offered by a bank- has experienced the moment when they wanted all their various accounts and cards from various institutions to be included. After all, the whole idea of PFM is based on the notion of having a complete overview. 

Excluding the USA and a few other markets where account aggregation is the norm, the rest of the world, and in particular Europe, seems to have little clarity on the topic beyond a set of personal experiences. Ask the average European banker today if they think their clients would want to have Account Aggregation and you get eyes rolled with an implicit "this is such old news, what sort of a question is that, of course they would". Ask them what Account Aggregation is, what types there are in terms of technology, what that involves to the client and the implementing bank and finally, ask what the regulatory implications are and what the business case beyond customer satisfaction is and get either a flurry of half-educated guesses or mere puzzled silence. 

Despite having a world-class Account Aggregation engine in our PFM solution allowing us to do aggregation for any market, Meniga is not an Account Aggregator at core. However, we have witnessed bankers in various markets agonize over the topic, sometimes transforming the issue into a national dilemma and moving away from clarity. So we have put together a set of honest, straight-to-the-point questions and answers aimed to provide some perspective.

The Big Account Aggregation FAQ:

What does Account Aggregation mean?

Do users want to see all of their data in a Personal Financial Management Solution?

Yes. PFM doesn‘t work if you only have a partial view of your financial situation. In our experience, it is the number one requested feature for all users who can‘t effortlessly import data from all sources. While some people have most of their data in one place, lack of account aggregation is a major hindrance to large scale adoption in many markets. 

What is the difference between Automatic and Manual Account Aggregation?

Manual Account Aggregation means users have to manually import the data into the PFM Solution – typically by downloading statements from various online banks and then upload these statements to the PFM application. While hard-core PFM users are generally happy with this approach, particularly if the interface is optimized to make this as easy as possible, and if this is complimented by an alerts set-up to remind users to perform the manual aggregation operation again, most people won‘t stick with it. Automatic account aggregation, however, means that the data is automatically imported on behalf of the user and typically updated periodically even without the user logging in (e.g. once per day). On the flip side, though, we have some evidence to suggest that users who have Manually Aggregated and make a habit of it are more invested with the PFM solution. 

Does Automatic Account Aggregation mean screen scrapping/web-scrapping?

Generally yes, but not always. Some markets have open standards (APIs) to access financial data with the permission of the user (Germany‘s HBCI interface is one example) but usually the data is accessed on behalf of users using web scraping technology, obtaining permission from the user or a limited power of attorney and optionally allowing users to securely store the usernames and passwords required to access the data. 

So our bank will have to store users’ passwords?

Not necessarily. Users are generally given the option to not store passwords but enter them every time they log on  – this is also required in case two-factor authentication is needed to get the data. 

What is the difference between client-side and server-side Account Aggregation?

Server-side account aggregation means that the PFM solution accesses the data directly on behalf of the users (from the PFM server), on any device, having previously gotten the required permission and login credentials from the user. Client-side account aggregation means that the data is accessed directly from the user‘s own computer and from there it is channeled to the PFM application. While some users (and banks) may be more comfortable with client-side account aggregation, it means aggregation can only happen when the user‘s computer is turned on.

Can banks block each other from performing Account Aggregation?

Yes. Server-side Account Aggregation can generally be blocked by financial institutions but Client-Side Account Aggregation can generally not be blocked. Banks who decide to block aggregation generally take this decision very seriously and carefully consider the potential negative PR impact this can have. We haven‘t seen many cases of banks blocking account aggregation but we know many are considering it. The „preferred way“ to block it seems to be to enter into an understanding with other banks in the market.

What are the security concerns around Account Aggregation?

None form a technical standpoint. Securely storing passwords to perform periodic updates is demonstrably safe and secure.

What are the privacy concerns around Account Aggregation?

Some users definitely don‘t wont their data aggregated but no aggregation can happen unless users give their informed consent and voluntary provide their login credentials so this is really not a concern. Implementing Automatic Account Aggregation does not mean every user will magically see all their data, this is a voluntary process since users have rights to access and use their own data as they wish.

What are the legal concerns around Account Aggregation?

None with regards to manual account aggregation but as for automatic account aggregation there are a number of considerations since it is really not the user accessing the data but an account aggregator on behalf of the user. First, users provide their informed consent that generally involves providing the account aggregator (e.g. a bank offering PFM) a limited power of attorney to access their data – legally this is no different from allowing your lawyer or financial guardian to access data on your behalf. The only caveat is that banks have to be careful to present the terms of use clearly enough so users can‘t dispute having given their informed consent that they are granting the account aggregator a limited power of attorney. The final consideration here is that some (but not all) banks explicitly forbid its users to give their login credentials to 3rd parties as part of the terms of use of their online bank. This is perhaps the biggest concern but generally account aggregators make it clear in the terms of use that it is the user‘s responsibility to ensure they have rights to provide them with their login credentials. 

What are the business benefits for me as a bank in offering Account Aggregation beyond just high user satisfaction and higher adoption of PFM?

In short, Data Mining and Cross Sales. Account Aggregation offers banks an unprecedented view of their customers and data and it is then only up to the bank's ability to turn that information into revenue. Some markets have regulations that limit this use (see below) but aggregated statistical data can almost always be used.

What are the potential regulatory challenges in offering Account Aggregation as part of PFM?

None as far as we can tell. We are not aware of any market where account aggregation is explicitly forbidden and precedents for account aggregation in some form exist in most markets. Modifications of the terms of use is generally all that is required. 

What are the potential regulatory challenges in using the data obtained through Account Aggregation?

The answer to this is country specific but the common thread is that knowing what part of the data can be used, is essential. In most markets we have analyzed, the restrictions on what data can be used are fairly minimal. Typically, personally identifiable information can not be used as-is but can be used once it has been anonymized and segmented and it becomes non-personally identifiable, etc (e.g. Bank X cannot message John Smith saying "Hey, I see you only get 1.5% returns on that savings product at Bank Y, why don't you move that business to us to get 3%?" but they can message all males under 30 who do not have savings products with Bank X).

Can't a bank have PFM in the absence of Account Aggregation?

Of course they can but the value of doing this varies by country. It partly depends on the ratio of a bank‘s customers who use it as their primary bank and have little or no data with other banks – this varies by country. Also, in some markets Automatic Account Aggregation has become the standard practice and not offering is therefore a major liability - imagine a new US PFM solution offering no Account Aggregation, they would not be poised for spectacular uptake, would they?  Whereas some other markets are still without any PFM offering and implicitly clients have no expectations in terms of the convenience of the service but even there, an offer without any Account Aggregation would not fare well against one offering the option to Manually Aggregate. 

Will Account Aggregation become the standard in the future?

Without a doubt. It is in the US. At this point in Europe with some banks offering no PFM, others offering PFM lite and Account Aggregation ranging from absent to Manual to Automatic, offering it remains a differentiating factor and constitutes a competitive advantage. In the long run, PFM will become ubiquitous, with most banks offering it in some form -and some argue it will completely merge with or replace today's online bank - and then Account Aggregation will inevitably follow across the board, thus eliminating its potential as a differentiating factor but enabling the same level of convenience for the user.

Do all white-label PFM providers offer an Account Aggregation engine?

No. Ask your PFM provider about their capability even if you are not planning on implementing any Account Aggregation immediately but want to take a wait-and-see approach. 

The French Online Banking Revolution

During the months past in 2011, we have had the opportunity to speak to most big, as well as some smaller banks in nearly all of the European markets. With not a single exception, PFM has been a hot topic.

However, discussing a hot topic is of course not the same as taking action. Most banks we’ve spoken to, do see the potential of a PFM project, whether their interest lies in increased retention, brand building, cross-selling, increased card sales or even data mining – but few are quick to make it a priority – perhaps no surprise to those of you who know the adoption rate of innovation in your average FI.

This "verba non acta" mindset can be noticed in most European markets we're working in, with a few exceptions. For example, our home market of Iceland, where we have already signed with the three biggest players, is one of these exceptions - though we won’t discuss it further in this post. Some would argue that Germany, some parts of Scandinavia and the UK will move remarkably quickly next year but the pace of adoption there is not extraordinary. A more interesting exception – is France.

In 2011 The world retail banking report identified France as being the most successful country in Europe in terms of delivering successful experience through their branches, the importance of which we’ve also noticed in our talks to clients, but also the least successful in terms of mobile and phone channels. Arguably, French banks are determined to change this for the better, perhaps this determination is one driver behind the huge interest in PFM that exists in French retail banks today. Some believe that the increase in internet penetration to 68% of the population (2010) from a mere 50% in 2006, plays into why France has just now started working diligently on improving their online and mobile channels.

We can already see some of the responses to the need to take these channels seriously and invest in innovation, if we judge after some of France's most forward financial brands using Facebook as a sales channel and dabbling into crowd investment (Hopee) and even innovative online payment methods (TooKam). These will all play a role in the new developments that poise France to take the lead within European online and mobile financial innovation next year if the trend continues.

A concrete observation that we’ve made at the beginning of this new trend is that Account Aggregation is a topic that has definitely been instrumental in getting the French banks to move on PFM and revamping their online channel. French banks were already keeping a close eye on the local Mint-clone Linxo.com and when Boursorama (Societé General) employed a vocal marketing campaign to show they started offering aggregation of 3rd party accounts, it successfully got clients from competing banks to sign up for their service, without having to have an account with Boursorama - or at the very least, it appeared it did. Obviously, this meant that other players needed to seriously consider matching the offering – or lose their customers’ engagement and tremendous data mining opportunities to a competitor platform.

On the other hand, we’ve noticed that there are some concerns around account aggregation and what an FI can or cannot do with the aggregated data with consideration to current French regulations. Surprisingly, although aggregation has been a driving force in the French PFM market, these concerns seem be of great enough magnitude for some banks to consider leaving account aggregation out all together from this new online and mobile technological revolution, at least for now.

Should France still be a market where there was no offering with account aggregation, automatic or manual – this wouldn’t be an issue, but considering the status quo of what Bousorama's and Linxo's clients have come to already expect, it could prove to be a costly mistake as offering anything less is possibly going to affect PFM adoption, hurt customer satisfaction through reduced usability and shatter a case for acquisition.

Many of the existent PFM projects (and yes, France has more banks with an active PFM project than any other country in Europe today) are debating the pros and cons and are trying to understand the many nuances of what is technologically possible and what is legally and morally necessary as well as trying to formulate a PFM and Account Aggregation strategy to simultaneously keep them safe and keep them competitive and that is no small order. 

Yes France is undoubtedly set to unveil a new online channels face for their clients in the next year and yes, they will be ahead of most other European countries when the new online banks will actually bring value to the client through PFM but whether or not they are ready for Account Aggregation is a whole other question.

A fly on the wall in French banks' meeting rooms these days would witness heated debates with some of these questions articulated over and again: "Shall we build completely walled gardens, forget Account Aggregation even exists? Shall we block each other from doing it? Is that possible? What will the clients think of that? Will we lose clients to those who allow a complete financial overview? Shall we do the opposite and have account aggregation be the norm, like in the US, allowing everyone to aggregate anything and only worry about the law, regulations and privacy concerns by using opt-in/opt-out and allowing the client to drive? Would this be required? Is this the future of responsible information mining? Isn't there a way to only allow voluntary, manual import? Where will this data be stored? What data can we use? What data would our clients want us to have if we were to give them value for it? What kinds of Aggregation are there? When will Account Aggregation become a sine qua non condition for our clients and is it just a nice-to-have feature today?" 

And it seems that despite the ongoing French Online Banking Revolution, the overall answer to all those is, at least for now, echoing Scarlett O'Hara's "I'll think about this tomorrow". 

--- The next post from Meniga aims to give more clarity on Account Aggregation to banks everywhere who struggle with these same questions and find themselves to be as confused on some of these topics, so stay tuned...

Arion bank launches Meniga’s PFM Solution with a bang

Last week Meniga broke a record in daily user registrations as Arion bank, the largest bank in Iceland, launched their PFM offering, powered by Meniga.

The launch was highly anticipated by customers of Arion bank and was made even more popular as many households have accounts with both Arion banki and Íslandsbanki who already offers Meniga’s PFM Solution – providing the ability to automatically aggregate accounts and cards from both banks.

The PFM service was made available last Tuesday through Arion’s online bank and was followed by a nationwide advertising campaign the following day. It’s safe to say that Arion’s customers flocked to try the new service and experience a better way to manage their finances.

Prior to Arion’s launch, Meniga’s PFM Solution was being used by 6% of Icelandic households. Less than a week from Arion’s launch, we’ve reached almost 10% and we anticipate at least 25% before the end of the year with the bulk of new users coming from Arion bank and Landsbanki (Iceland’s 2nd largest bank which will launch the service in October).

Meniga will closely monitor Arion’s PFM offering and it will be interesting to see if they can beat Íslandsbanki’s PFM adoption rate of 35%.

How to win friends... and sell more bank accounts.

Fresh statistics from one of our Icelandic implementations has shed new light on the everlasting question: what is the measurable ROI of PFM?

In this case, a customer who has used the PFM system at least once per month on average during the past year is defined as an  “active PFM user” and if PFM is given proper, first-class status within the online bank, converting a large amount of online banking customers to active PFM users is the natural outcome.  

Why we won't see "every bank worth its salt deploy PFM in 2011" in Europe

Not long ago, Rob Findlay at TheBankChannel professed all banks worth their salt will be deploying PFM before the year is out. We're no longer sure that's true and for once, the delay may be a good thing.
PFM is a hot topic in the industry, this is a fact. However, discussing a hot topic is of course not the same as taking action. Most banks we’ve spoken to, do see the potential and need of implementing PFM, whether their interest lies in increased retention, brand building, cross-selling, acquisition or data mining – some even see the urgency but not all are as quick to make it a priority and put it in front of their clients before 2011 is out, for some it is still Verba, non acta.

In a way we can conclude that should the banks keep on thinking PFM is nothing but a set of visually tantalizing graphs and a half accurate collection of categorized transactions that they can quietly offer in a corner of their IB real estate as a fun add-on, then we would have seen more banks deploy it faster and perhaps, the above prediction would have been correct.

Let's consider these statements:

• PFM contains the Holy Grail of CRM - previously inaccessible, highly individual, private data on consumer's transactions
• PFM redefines targeted advertisement
• PFM is sticky, sticky, sticky
• PFM is incomparably more engaging and offers superior UX than any online bank
• PFM does more for branding when it comes to offering value and customer satisfaction than a cup of coffee and the bank supporting a local charity
• PFM can, and does become the customer's most frequent point of contact to the bank in the online, email and mobile channel

Tall orders? Heavy topics involving several key business units? To take full advantage of all those and others banks would have to do a lot of thinking and then measure it carefully? Exactly. And if you factor in banks’ nearly endemic fear of raising topics such as "profit"; "monetization", "reflection in bottom line"; and more you have a better picture of part of the challenges that will make most banks late to the PFM party.

With all that said, this is not the classical "banks move slowly because they are monolithic tortoises with no real purpose behind their slow reactions", this is a good kind of late, the "a-ha moment" kind of late and of the ones doing their homework this year, who will launch their PFM offering in 2012, their salt will be worth even more.

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This article is the first in a series looking at the speed of PFM adoption in Europe and will be followed by a series of entries analyzing the speed of reaction of different markets such as Iceland, Spain, the UK, France and Norway.

10 rules to make a great online bank dashboard

What it comes down to is really a matter of making the task of online banking quick, easy and preferably fun. 

Keeping up with the PFM Jones: Knowing Your Right From Your Lite

The further the PFM butterfly emerges from its cocoon and blossoms into a full capable new way of banking, the more the bar for customer satisfaction is raised. Expecting the features found on Mint.com is becoming standard and those features are far from what PFM ‘Lite’ have to offer, so one has to wonder if implementing these just to "keep up with the Financial Jones" will be good enough, if throwing a PFM bone to one's customers is more likely to be a risky branding movement, or a worth while effort.

Statements such as “If we aren’t introducing innovations into the customer experience at the same rate with which customers are adopting these new technologies, we are at a considerable disadvantage and we risk losing our customers as more agile intermediaries and third parties capture the benefit of the innovation. Just because we are ‘the bank’ doesn’t cut it anymore.” (King, 2010) and "by the end of 2011 every bank worth its salt... will have a PFM solution for its customers" (thebankchannel.com) have led to many financial institutions reacting by scurrying to gather as many vendors who declared themselves capable in the space as possible, and were enchanted by the most purchasable offers letting price and implementation terms overshadow their better judgment that would have dictated they took a step back and seriously considered features before defining their scope.

A lesser PFM will offer less customer satisfaction and hence, lesser engagement, lesser engagement will mean lesser sales of bank products, less accurate and interesting data the bank can use, and even lesser brand brownie points for promoting financial literacy.

Even if the bank doesn't understand the business case for PFM from the measurable retention and cross-sales point of view and they declare themselves interested only for branding and social responsibility purposes, PFM must-have's, must indeed be had, before this is put in front of an all too spoilt PFM consumer.

Mint.com hasn't only started the game but changed it too, they taught the user that they can have the PFM pie in as many flavors as he or she wishes and offering anything less these days can account for initially excited customer turning fast into disgruntled, disillusioned clients.

Some would claim that the value of sophisticated PFM is lost on the masses and the bulk of one's customers are uneducated PFM wise and unlikely to be dissatisfied as the savvy early adopters but is that truly a sound strategy in this day and age? Disfranchising one's advocates and offering the masses a sub standard product - they will quickly label as such themselves once you educate them - for the mere purpose of ticking a box?

Are we pleading the case of full-fledged PFM and that of The Bank of the Future out of the goodness of our hearts? No, we are a commercial enterprise who designs and sells a solution but we owe our clients the truth and the genuinely sincere advice is: Don't get PFM just to keep up.

Don't get PFM Lite if your goal is retention - you may achieve the reverse.

Don't get PFM Lite for branding - it won't win you any brownie points.

Don't get PFM Lite to do Cross -Sales - you won't see much more in the till and last but not least

Don't get PFM Lite for Comparable Parity - it will be like advertising the launch of a cool new Facebook-like social media site and offering 1998's Friend Finder.

Social Media: If the Client won't go to the Bank, the Bank must go to the Client

Finextra's London Social Media Day that took place yesterday in the heart of Canary Wharf at the Thomson Reuters Building, was one of the many events on Social Media these days but, paradoxically and maybe tellingly, one of the very few (the only?) on Social Media for Banks.

We have to confess we approached the event timidly. Yes we keep an eye on what banks do and yes, we spent a good few months working out how Meniga's PFM would best employ Social Media and integrate in a way that would keep our users entertained and attentive and harness the power of meeting them at their favorite online hang-out -Facebook, Twitter, etc-  in a fun way -quizzes, badges, etc- while protecting their privacy, but we are not a bank and we are not a Social Media technology vendor, so we felt sure there are those that have went far further than us. We though that there was potential to be wow-ed by what it is that banks are doing in this space. We wanted to hear not if the bank agreed with our above title, that they have to meet the client where the client is and not try to lure them back to their place, but indeed learn how they were surely already doing that. 

Let's just say our initial assumptions were incorrect.

For starters, when it comes to Retail banking, the event only had 5 or 6 banks represented and that under a very stretched definition. From those that were there, most had forward thinking attitudes and at least a story or two of social media used for PR and even Customer Support in their bag. First Direct's case study, the story of the Live experiment they ran, seemed to be the most advanced use of Social Media and beacon of Creative thinking in the UK to date. Even there, while undoubtedly creative in their use of social media channels to advertise Live as it was faster and cheaper than using traditional media, their animated LCD panels in the subway, their YouTube campaigns, First Direct is still, largely, just a case study on how to use Social Media for marketing purposes. 

And therein lies the problem. Social Media can be many a wonderful things to financial institutions and this presumption's infancy is clear from how unstructured the strategy around it is, and how the definitions and intentions are still so very blurry. It seemed there was a lot of talk around the "Nice to have"

type of effort and nearly none of "driving innovation to engage, bringing the bank where the client is" line of thought. It took a question from a vendor - Sales Force's representative- to bring it back to what the intention behind it is, what the strategy in terms of eventually seeing $ results from the effort is, and it was not until CME Group's Allen Schoenberg's panel appearance that words like "bottom line" or "leverage" were even uttered.

Other than that there was talk around online identity, protecting the brand, protecting the client, there were voices shocked at the platforms meant to ensure freedom of speech was corporately branded, moans about the gap between an event on Twitter and the same event IRL, about how there were too many suits or too long of power points and understated frustration all around from all those wanting to see more being done -and don't we all?- but there were also fun anecdotes and banter, along with glimpses of cool websites and murmurs of giddy anticipation alike but all those, while atmospheric were mere distractions from the topic: Social Media not for its own sake but as an Engagement platform. 

Engagement should not be, is not, mere communication but provoked action, getting behavioral output out of the customer in a predictable fashion while keeping it fun and useful. 

The three phases of Banking Social Media Involvement as they are hopefully going to play out:  1. PR (Twitter and Facebook pages as news outlets = Informing) ->  2.Customer Support (Addressing the client = Establishing Dialog) -> 3. Business Case (Product Recommendations/Aquisition/Campaigns/Sales executed within the Social Media channel = Offering Value, Advising and Realizing Sales

at the Client's preferred hang-out). The first two steps see Social Media channels being nothing but communication tools while the latter makes them true virtual branches possibly much more efficient in the future than the actual physical branch.

Banks' involvement in Social Media can become a runaway train getting nowhere or it can become a powerhouse with purpose if only we accept that the end goal to this has to be giving the client the engagement they want, where they want it and allowing them to read and ask, but most importantly build trust, be entertained, be offered value and yes, buy if they want to. There is nothing wrong with this starting as communication if it is agreed it's but a start.

For now it seems most banks (even the forward thinking ones with cool trendy, CEOs who are Social Media advocates like Saffron, Barclays and First Direct) started their Social Media presence on a "nice to have" and now "me too" motivation and they have yet to formulate any real strategy on how to leverage Social Media and achieve true engagement or they would be talking tools, methods, regulations, security, applications and software solutions to help them do so and maybe, one of the reasons why this is, is to avoid the dreaded ROI question but if so then we all need to man up and accept that the question is normal and the answer is absent and there is nothing wrong with either, it has been so since the dawn of technology and innovation.