Spanish bank CaixaBank has launched an app that enables customers to view their accounts and make transactions via Facebook.
Facebook be given regulatory approval as an e-money institution soon, which will enable it to offer consumers the ability to store money and pay others by Ireland’s central bank.
CaixaBank’s app is another sign that consumers enjoy the ease of use of social media when managing their finances. The app will let users view account balances and transactions for current accounts, cards and bills. It will allow customers to make small payments initially.
CaixaBank said the service is hosted in a fully secure and private environment that can only be opened by the customer. Facebook has no access to any personal or bank information, said the bank.
“Once activated, users can open the application via their personal profile or the bank’s Facebook page. Users will have to enter their Linea Abierta username and password each time the service is opened, as the service is located in a fully secure and private environment that can only be opened by each customer. At no time will Facebook have access to any personal or bank information.”
The bank uses startups to developing new technologies.
Although it works with large suppliers, including IBM, Accenture and HP, it seeks innovation from small companies with specialised knowledge. Benjami Puigdevall Esteve, head of electronic channels at the bank, told Computer Weekly last year: “We can’t ask the five big companies for that, because the knowledge in these areas changes every year, and it makes no sense for large companies to invest in changing technology.”
As financial services move online the lines between social media and banking are blurring. At the same time retail banks are under pressure from consumers and regulators alike to improve their own IT and make retail banking services easy to use whenever or wherever customers want it.
Traditional banks are unable to adapt technology quickly to meet customer demands because the legacy IT systems they use make it expensive and complex to do so.
It is not just Facebook. Retail banks could face competition from other internet firms. Consumers use web-based services that are trusted and have good IT. If services such as PayPal, eBay, Amazon, and Twitter moved into banking, they would attract customers. Their systems already contain details about people and businesses and handle transactions and money.
Recent research from Accenture, of 6,000 consumers surveyed in 11 countries, found that almost a quarter of consumers would consider large internet companies, such as Google and Amazon, as possible insurance providers. It also revealed that consumers see large internet companies as viable alternatives to retail banks in the future.
Regulators in Germany granted a banking licence to a group of entrepreneurs to create a bank that uses the technology to overcome the cost and complexity of traditional banking, while increasing customer trust through an online community.
Fidor Bank, as it is known, is a recognition that because Web 2.0 and social media are changing people’s social lives, they will change retail banking too.