Danny Peltz, executive vice president and head of Wells Fargo's Treasury Management group, oversees technology, innovation and everything else in the bank's treasury management (commercial cards, merchant acceptance, traditional payments like wires, ACH, lockbox, collections, cash vaults), corporate internet services, and health benefit services groups. He's been with the bank 23 years and oversees a staff of more than 3,700.
During a recent visit to the office of Bank Technology News and American Banker, Peltz shared six key areas in which his group is creating new technology to serve business customers.
1. Responsive design. Peltz's group has been spending a lot of time on responsive design an approach to web page design that's meant to provide an optimal viewing experience across a wide range of devices, from mobile phones to desktop computer monitors.
"It's our view that you have to build for the new mobile world," he says.
Today, most of Wells Fargo's corporate clients still do their banking on a desktop computer. But they need the flexibility to use other devices. "We've witnessed that people are floating between form factors smart phones, phablets, laptops and PCs," he says. "The way we feel we can be most effective is to not be beholden to any one form factor. That will let us change and course correct as things move forward," he says.
There's an ongoing debate in the industry about which is better native mobile apps created for iPhone, Android and Windows Phone devices, or responsive-design HTML5 sites that can run across all devices and reformat for each screen, but have limited ability to communicate directly with components in the device hardware such as the camera.
Peltz sees a place for dedicated apps, for instance to serve consumers. "But my experience is once you go down that path, you need to maintain all those apps," he says. "That becomes costly, especially in the business-to-business space," in which Wells Fargo has more than 80 online applications.
And the functionality of HTML5 is catching up to native apps, he believes. With HTML5, currently the bank loses a bit of response time and the ability to control embedded hardware in the device such as the camera and geolocation features. But workarounds can be created to improve, he says.
2. Biometric authentication. In the ongoing quest for a more secure way of verifying a customer's identity than a password or PIN, Wells Fargo is one of the many banks experimenting with biometrics. "Voice is the most natural biometric authentication," Peltz says, echoing sentiments his boss, Steve Ellis, shared with us a year ago.
But this comes with a big caveat, Peltz explains.
"You have to have five-nine availability for authentication, that's table stakes," he says. "I have not seen the technology that does that." The bank may combine biometrics with other types of security components to boost the acceptance rate.
The bank already uses voice authentication technology from Nuance in its wire room. It compares the voices of incoming customers against a database of "bad actors."
Peltz also sees voice recognition becoming a practical way for customers to interact with websites voice recognition technology improves.
3. Fraud analytics that predict user behavior. One technology Peltz has sought but not yet found is behavioral analytics for detecting fraud.
The bank, like many others, already uses fraud analytics extensively. "We score every payment transaction to ensure the integrity of the initiator, and the fact that the transaction is intended and not fraudulent," he notes. "Where I think this has to go is behavioral analysis where you can tell within a range what a customer is expected to do. If they go outside that range, that becomes a signal for further review is that normal or abnormal, do we need to call the client? You have a lot of people nation states, organized crime, kids in their basement all trying to go after the jewels of the organization. There's no tool out in the market today that will truly give you behavioral scoring on how a user uses your website and predicts the range of behaviors they might be taking."
Criminals and hackers tend to not behave like normal users, Peltz points out. They might go to the help section to figure out how to do something basic, which is abnormal. "You need to be able to track that in real time and be able to predict where they're going to go," Peltz says.
4. The mobile wallet. The ability to accept mobile payments will be become increasingly important, Peltz believes. While mobile wallets themselves are consumer products, they're presented by merchants and Wells Fargo has a large merchant acquisition business.
"The mobile wallet makes sense to me," Peltz says, as smartphones have become so important and ever-present to consumers. "I think the mobile wallet looks different for each person, just like everybody's wallet looks different." Far more can be stored in a digital wallet than in a physical wallet, he points out.
Wells Fargo recently began letting its credit cards be used with the Isis mobile wallet offered by telecom providers. The bank also has a mobile wallet pilot project that Peltz says the bank can't talk about yet.
Peltz also believes wearable computers will also be important to payments. "I'm not sure Google Glass gets there," he says. "There's a cool factor that needs to be figured out first. If it doesn't feel cool or look cool I don't think it will sell."
5. Business process management. Wells Fargo has embarked on a business process management project in which it's building automated workflows with reusable components.
Reusability is a Holy Grail, Peltz acknowledges. "Some of the technology is there. The real problem is not technology, it's culture," he says. "It's easy to tell people to be innovative. It's hard to tell people to be innovative while using common components." Employees need to understand how it will benefit them and speed up processes. "Then you have to really commit to it. It only works if everybody plays along."
6. Electronic signatures. In another big initiative, Peltz's group is creating the ability to let clients sign documents virtually.
The technology to click on "ok" and "accept" already exists, he notes. "There's a couple of steps needed to move forward," he says. One is creating the ability to let salespeople offer customers electronic documents with e-signatures on tablets. Another is facilitating document workflow and storage.