Niti Badarinath was climbing volcanoes in El Salvador recently when one suddenly erupted above him. The narrow escape helped him professionally reboot, as have other off-the-grid excursions including a hike up Kilimanjaro and a trek through the Inca region of South America.
"These experiences take me out of my comfort zone; they force me to set goals and be very outcome driven," he says.
Such are useful to Badarinath's job — he's in charge of digital innovation at $364 billion-asset U.S. Bancorp in Minneapolis.
In the past year, no bank in the country has innovated in mobile banking as much as U.S. Bank. It was one of the first out of the gate with mobile photo bill payments, in March 2013, and late last year it launched an app that allows consumers to apply for a balance transfer to a U.S. Bank credit card simply by taking a picture of a credit card statement. Its pilots of voice biometrics for customer authentication and voice-activated mobile banking are among the first. And a unique app the bank launched this year called Peri is one of the few bank offerings to offer a plausible take on mobile commerce.
"We don't know if the winning technology [for banking and payments combined] will be quick-response codes, near-field communication, or something else," says Badarinath, senior vice president and head of mobile banking and money movement at the bank — and BTN's Digital Banker of the Year. "We do know that waiting is not an option. We know we have to move."
The urgency comes from a sense that customer needs have gotten ahead of banks' ability to meet them. "We want to get ahead of that curve," says Badarinath. "We think the best thing to do is to try many things, be very mindful about what we're doing and be very calculated about the metrics."
Mobile banking usage at U.S. Bank grew 37% last year. The bank now has 2.4 million active mobile customers. The number of remote deposits has grown from 147,000 transactions and $61 million deposited in 2011 to more than 2.2 million transactions and more than $1 billion deposited in 2013. More than 86% of remote deposits are mobile. And more than 7,000 transfers have occurred through its mobile photo balance transfer feature since the app went live in December.
Its many imaging projects — letting customers capture checks and bills with their smartphone camera, for instance — are designed to reduce friction and lessen the tedium of manual data entry. The bank works with Mitek to develop new imaging applications. And much credit for the bank's mobile advances, Badarinath is quick to point out, goes to Dominic Venturo, BTN's 2011 Mobile Banker of the Year, who runs innovation on the payments' side.
"We have pockets of innovation throughout the bank," Badarinath comments.
The bank holds "innovation jams" in which leaders from different groups that have digital products talk about their business needs and their customers' needs. Heads of credit cards, checking accounts, mortgage products, branches and call centers are included. Badarinath is then responsible for rationalizing and prioritizing the list of potential innovations.
"I don't want to give the impression I sit in my office, close the door, and decide things," he says. "It's a collaborative effort." A key question is: Does the innovation address a known customer need, a pain point or a certaion lack of satisfaction? Some imaging capabilities, for instance, were developed out of a recognition that customers don't like having to type in information, especially on a small phone.
U.S. Bank also looks for "white space" — the things no one else is doing yet — to differentiate itself from the pack. "There's a herd mentality in banking — if one bank does remote deposit or person-to-person payments, they all do it," Badarinath points out. "We want to identify those areas where nobody is. Is it white space because nobody wants it or because nobody's thought of doing it?"
In its branches, U.S. Bank is contemplating equipping tellers and branch managers with iPads. It's considering ways to drive enrollment in mobile bill pay and check capture through the branches. It's thinking about using Apple's iBeacon wireless sensors to communicate with customers' smart phones.
In the call centers, the bank is working on letting customers authenticate themselves with a spoken word.
Badarinath and the bank's technology group have built an innovation lab they refer to as a "sandbox" for testing new technologies. "This lab lets us do internal and vendor-driven tests," he says. "It's a well-contained environment, we can have vendors come in and demonstrate their products."
He adds that having an innovation lab on site allows his team to quickly devlop new products and test them out on employees. "It enables us to refine, iterate more quickly and get to market more quickly."
U.S. Bank's primary digital banking technology partner is Fiserv — it uses the vendor's Corilian for online banking, Popmoney for person-to-person payments, CheckFree for bill payment, and Mobiliti for mobile banking. But the bank customizes all those pieces to manage the customer experience to its own liking.
One of the most forward-thinking innovations to emerge from U.S. Bank this year is Peri, its ecommerce app. The app lets a user read a digital watermark or QR code to quickly purchase an item. Very few banks have created mobile commerce solutions. A few banks have experimented with NFC stickers and chips that customers can use to pay at a retailer, perhaps with an electronic coupon. But an easy to use, trendy shopping app has eluded the industry.
"We know we want to give our customers the ability to have banking and payments in one app," Badarinath says. "We're trying different things. We don't have the foresight to say a year from now everybody will be using QR codes or Apple's wallet or the host card emulation that Visa and MasterCard have."
Peri is one bet U.S. Bank is making on mobile commerce. Another is its collaboration with a large card network on HCE, to see how a bank-branded wallet will work with certain merchants. The bank already has a mobile wallet in which customers can store their credit, debit and prepaid card information. On the mobile banking side, Badarinath aims to build features into the bank's apps that will help with mobile payments, such as biometric authentication, real-time, pre-login balance access and push alerts.
"Smart banks, us included, are making a lot of bets," says Badarinath. Like an outdoor adventure, the surprises — happy or otherwise — provide a chance to learn and to reboot.