To provide mobile banking for their small-business clients, some banks recast and remarket their consumer mobile banking programs rather than create something new. The critical piece that such an approach lacks is entitlements — giving the small-business owner a say in who can do what in the business account, says Javier Reyes, vice president, manager of cash management services for Popular Community Bank, Chicago. The bank last week launched a homegrown small-business banking application.
"Having small businesses use the basic retail banking mobile app seemed to us like the easy way out, but not the best long-term solution," says Reyes, who handles development of technology and integration with small businesses. "It's all about entitlements; you cannot just change the color on a consumer app and offer it to small businesses. Entitlements can only be achieved if you have a business platform."
The subsidiary of Banco Popular of San Juan, Puerto Rico, has been rebranding itself across the country as Popular Community Bank. It spent two years developing this application. "The business application is generally more complex, the settlement process is a little bit more difficult and the logistics are more complicated," Reyes says. "But we thought we needed to do that to be ready for the future."
Providing entitlements means being able to segregate duties, provide audit trails and provide controls over who can do what. "Small businesses want to have the peace of mind that they remain in control," Reyes says.
With the bank's new app, each user on a small-business account gets his or her own username and password. The business owner can decide to delegate certain banking tasks to particular employees and makes those selections in the online banking site. "Maybe the bookkeeper is his right-hand person," Reyes says. "He could allow that person to transfer money from the operating account to a payroll account or he can authorize the bookkeeper to make a payment to a vendor, but without losing control, because he could go into the entitlement piece and let that person make vendor payments only up to $3,000. That gives the owner the peace of mind to delegate, to feel completely at ease that he's not taking any risks."
The next version of Popular Community's small-business mobile banking app will include remote check deposit. "After that we want to tackle approvals" for services like positive pay and fraud prevention, Reyes says. "These are ways we can keep connected to our customers and provide convenience so they can see if there was a check presented that they never mentioned to us, they can say whether it's good or bad."
Also on the drawing board are mobile fund transfers. "That's the one that's more challenging, because of the risk involved," Reyes says. "Right now, in order for customers to make a wire transfer or positive pay, they need to have a hard token, something they carry that has a number that changes every 30 seconds. There's new technology being developed that will allow the customer to have a soft token. We're trying to find something that will be completely secure for customer but will not be burdensome. You don't want to have a customer on a smartphone having five different tokens hanging from his neck."
Michael McCracken, Illinois region executive, says he hopes the new application will keep current small-business customers happy. "I feel it's our obligation to be on the front edge of banking technology. This will hopefully create a user-friendliness about the bank that will create a stickiness that will keep our clients here," he says.