Wednesday, 3 September 2008

Viral Banking. What is it?

I was in a creative innovation lab session yesterday and came up with the term 'viral banking'. I think it's usually best to come up with the jargon and then re-engineer it into a concept which is likely to have resonance with customers and industries. So what could it mean then?

Well, bearing in mind that Faster Payments as a policy-driven initiative being overseen by one of the UK banking industries overseers (APACS) is about to speed up all of our banking transactions, maybe viral banking is a threat to mitigate against. As processing times for our funds transfers speed up from around four days to something less than 15 seconds, everyone is rightly nervous about the opportunities this presents to fraudsters looking to make a quick cash-grab and disappear. As you can imagine, introducing the scheme without opening the door to criminals in this way has been top of the list for the security conscious banks.

But what are customers getting from this... could they be the real beneficiaries of viral banking on the back of the Faster Payments initiative? Rate watchers, day traders and the financially astute have become used to tracking their investments on a day-by-day, hour-by-hour and even minutes-by-minute basis. Ultimately though what Faster Payments could deliver is the means to transfer allegiances around the financial services marketplace within seconds based on new deals, new offers or even scare stories!

Imagine the queues running round the block for days on end which we witnessed when Northern Rock ran into trouble being over and done with online in a matter of seconds. Have you ever been sitting there clicking refresh, refresh, refresh trying to buy sought-after tickets for, say the Led Zep reunion only to be disappointed and to read later that the event sold out in something like 11 seconds. Well viral banking could be like that. Marketeers used to spending weeks or months developing, focus-grouping and readying new banking and saving products will need to be on their toes to keep up with the ultra-responsive mechanisms available to all customers across all channels.

The impact on brands? My guess is we'll see more 'limited edition' products and rates as banks use the energy created by the increasing momentum of the industry's payments traffic to further stratify their customer base and try to understand the true meaning of loyalty when the value of a new offer can be assessed, rejected and countered in minutes!

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