Many banks spend a lot of time talking about what they would like to be providing for their customers. Only a few banks are able to put those words into action and come out with something innovative and useful to customers. Nationwide has gone and done just that, writes Billy Bambrough
Nationwide’s voucher app, dubbed Simply Rewards and developed with Visa, launched on 13 October and according to head of retail at Nationwide Chris Rhodes, has already been downloaded over 5,000 times.
The app is one of the first instances in the UK of a bank effectively making use of the vast swathes of data it holds on customers, in this case to to provide customers with retail discounts based on their previous spending habits.
Nationwide, the UK’s largest building society, upgraded its core banking system in September 2013 in order to be able to offer its customers a wider range of current account products that were impossible with its legacy system.
Though the bank has had a good year due to strong earnings and variety of launches, it is still far away from achieving its goal of 10% of the UK current account market, only increasing to 6.4% from 6.2% in 2013.
The bank has also used the opportunity to leapfrog many of the mobile and online banking channels on offer at other UK highstreet banks, many depending on creaking systems never designed to support the level of transactions now being thrown at them.
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The app analyses past purchases to display tailored offers to individuals, as well as allowing customers to search for discounts from a range of high street brands based on location and category, such as food entertainment or travel.
Rhodes told RBI: "Nationwide has seen the adoption of previous apps grow quickly, indeed since June when we introduced Impulse Saver and Quick Balance to our banking app – millions of pounds has been saved and Quick Balance has been used over 10m times."
The app displays prioritised offers to individual Nationwide customers based on their spending history, meaning that if a customer is more likely to dine out they will see restaurant offers higher up in their list of deals.
Rhodes said: "Our research shows that vouchers and offers now play an important role in people’s spending behaviour. The app highlights the best offers based on how they are already spending their money."
Rhodes reveals that the use of mobile banking at Nationwide has been growing far quicker than the grow that online banking saw in its early days.
Rhodes said: "The speed of adoption of new technology is ever increasing – in July, the number of transactions carried out on our mobile banking app exceeded those carried out on our internet bank for the first time. At that point the mobile app had only existed for 20 months, whereas the online bank had been around for 17 years."
According to Rhodes this is just the tip of the iceburg when it comes to technology and digital strategty.
"Nationwide’s innovation strategy is simple; we are investing in technology which makes life better for our members and our people. We are using digital innovations to better connect our people with our members and ensuring that members have access to our experts anywhere and at any time.
"In the future we will be investing in new apps, online services and branch technology."
Mobile banking functionality in the UK has been growing quickly in recent months as banks add the ability to withdraw cash at ATMs through apps and send money via mobile phone numbers, with mobile cheque deposit, a common feature in the rest of the world, expect to arrive in 2015.
The UK’s Payments Council has been behind many of the mobile based payment innovations, teaming up with Vocalink to launch phone number payment service Paym and getting the banks on board with customer to merchant mobile payment service Zapp.
Outside of payments however, banks have been unable to compete with the third party providers of spending and location analytics due to the constraining legacy systems.