Virtual Banking – A Guide to Innovation and Partnering

<p>Foreword xiii</p>
<p>Preface xv</p>
<p>Acknowledgments xix</p>
<p>INTRODUCTION</p>
<p>Innovating through Scarcity 1</p>
<p>The Influence of Cloud on Innovation 3</p>
<p>The Influence of Smartphones 4</p>
<p>Big Data = Big Driver of Innovation 4</p>
<p>Taking a Cue from Retailing 5</p>
<p>The Enemy of My Enemy Is My Friend 6</p>
<p>Reconciling Innovation and Regulation 6</p>
<p>In Search of New Payment Revenue Streams 8</p>
<p>New Skill Sets for a New Era 9</p>
<p>A Road Map for This Book 9</p>
<p>Notes 11</p>
<p>CHAPTER 1 Consumer Empowerment Knocking at the Door 13</p>
<p>How Mobile Is Reshaping Consumer Expectations in Financial and Retail</p>
<p>How Mobile Is Changing Consumer Behavior 15</p>
<p>Mobile Is Blurring the Lines between Digital and Physical 17</p>
<p>Mobile Learnings from PayPal and Square 19</p>
<p>Mobile Commerce through Tokenization 27</p>
<p>The Mobile Camera It s Not Just for Pictures Anymore! 29</p>
<p>The Mobile Microphone Offers and Payments through Soundwaves! 30</p>
<p>NFC s Rebound and the Promise of Host Card Emulation 31</p>
<p>Apple s Passbook 33</p>
<p>The Apps Phenomenon 35</p>
<p>The Uber–ization of Mobile 36</p>
<p> Top of Wallet to Top of Mobile 38</p>
<p>The Case of Braintree and Simple 39</p>
<p>The QR Code 40</p>
<p>What Banks Can Learn from Starbucks 41</p>
<p>Leveling the Playing Field with LevelUp 43</p>
<p>From Mobile Banking to Tablet Banking 45</p>
<p>Mobile Models for the Emerging Markets 47</p>
<p>What s Next? More of the Same 51</p>
<p>Notes 52</p>
<p>CHAPTER 2 Social and Financial Services 55</p>
<p>Maintaining Relationships and Relevance through Social strategies</p>
<p>Digital, Data, and the Future of Banking 58</p>
<p>Social Media Experiences in Banking 60</p>
<p>Gamification 62</p>
<p>Personal Financial Relationship Mapping 63</p>
<p>Capitalizing on Social Banking 65</p>
<p>Moven: Delivering Banking through Social Context 66</p>
<p>Social Banking in Europe and Asia 70</p>
<p>Social Login, Sharing, and Top of Wallet 71</p>
<p>Peer–to–Peer Lending: Blending Social and Banking 73</p>
<p>Beyond the Hype: Partnering for the Future with Peer–to–Peer Lenders 74</p>
<p>Lending Club: A Win–Win for Banks and Their Customers 75</p>
<p>Takeaways for Banks 79</p>
<p>An Investor s Perspective on Social Banking and the Emergence of Bitcoin 80</p>
<p>Message To Banks: Be a Smaller Part of a Bigger Pie 85</p>
<p>Notes 86</p>
<p>CHAPTER 3 Connected Financial Commerce 89</p>
<p>Location–Based Services, Mobile Commerce, and Digital Wallets</p>
<p>The Local Digital Wallet 91</p>
<p>The New Retail Experience 91</p>
<p>Retail 2.0 and Its Effect on Payments 93</p>
<p>Entrepreneurs, Developers, and Financial Services 95</p>
<p>Context Banking: The Next Step 96</p>
<p>Low–Energy Bluetooth, Hardware, and the Future of Commerce 97</p>
<p>iBeacon and EasyPay: The Future of In–Store Payments? 98</p>
<p>PayPal s iBeacon: Proximity and Context 100</p>
<p>Google Glass for Finances 101</p>
<p>In Search of the Digital Wallet 102</p>
<p>Personal Financial Management 103</p>
<p>Coupons 104</p>
<p>Shopping Tools 104</p>
<p>Loyalty and Prepaid 104</p>
<p>Tickets and Passes 105</p>
<p>The Who s Who of Digital Wallets 106</p>
<p>Google 107</p>
<p>LifeLock (formerly Lemon Wallet) 108</p>
<p>PayPal 109</p>
<p>Carriers 110</p>
<p>Retailers 111</p>
<p>Square Wallet 113</p>
<p>What s Next? 113</p>
<p>Notes 114</p>
<p>CHAPTER 4 Innovating with Big Data and Open Platforms 115</p>
<p>Competing in a World of Unlimited Data and Storage</p>
<p>The Rise of Platform Services 121</p>
<p>Application Programming Interfaces (APIs) for Online and Mobile Commerce 122</p>
<p>Coping Strategies for Banks 123</p>
<p>PayPal s Bold Bet: Unleashing Innovation through an Open Platform 125</p>
<p>App Stores for Banks: Will It Work? 133</p>
<p>What s Next? 139</p>
<p>Notes 141</p>
<p>CHAPTER 5 Math–Based Currencies 143</p>
<p>How Bitcoin May Prove Transformational to the Financial Services Industry</p>
<p>Entering the Age of Context 143</p>
<p>Intro to Math–Based Currencies 146</p>
<p>Why Math–Based Currencies ? 147</p>
<p>MBCs Are a Reality 147</p>
<p>History of Digital Currencies 148</p>
<p>Math–Based Currency Characteristics 148</p>
<p>Bitcoin: The First MBC 149</p>
<p>Bitcoin s Brief History 150</p>
<p>Is It Bitcoin, bitcoin, or Just BTC 150</p>
<p>Bitcoin Is a Powerful Concept 150</p>
<p>How Bitcoin Works 152</p>
<p>Digging Bitcoin 154</p>
<p>Digital Push Payments 156</p>
<p>Counterfeiting No More 156</p>
<p>MBCs Enable Programmable Money 156</p>
<p>Completing the Bitcoin Ecosystem 157</p>
<p>Bitcoin Exchanges 158</p>
<p>Bitcoin Wallets Where to Store Your BTC 159</p>
<p>Mobile Wallets 159</p>
<p>Cloud–Based Wallets 159</p>
<p>Bitcoin Hardware Wallet 160</p>
<p>Bitcoin Vaults 160</p>
<p>Trading Platforms 160</p>
<p>Bitcoin Use Cases in Payments 161</p>
<p>MBCs as Payment Rails 161</p>
<p>B2B Payments The Known Counterparty 162</p>
<p>Bitcoin and Consumer Payments 162</p>
<p>Buy Me a Beer 163</p>
<p>E–Commerce and MBCs 163</p>
<p>Getting Harder: Music and Video 164</p>
<p>Challenges at the POS 164</p>
<p>Improving Bitcoin Processes 164</p>
<p>Improving the Bitcoin Protocol 164</p>
<p>Programming Bitcoin for a Special Case: Online Micropayments 166</p>
<p>Wallets 167</p>
<p>Ripple: The Second MBC 167</p>
<p>MBC Use Cases in Banking 168</p>
<p>International Remittance Rails 168</p>
<p>Interbank Settlement 169</p>
<p>Building Trust with MBCs 170</p>
<p>Automating Transaction Policies 171</p>
<p>Moving Ahead with MBCs 172</p>
<p>Conclusion 174</p>
<p>CHAPTER 6 177</p>
<p>The Smart Pipe</p>
<p>Models that Will Survive the Next Generation The Prepaid Model 178</p>
<p>Prepaid Nation: Redefi ning What a Bank Can Be 179</p>
<p>The Underbanked and Opportunities for Innovation 184</p>
<p>Stockpile: An Example of Brokerage Innovation Through Partnering 185</p>
<p>MoneyGram: An Example of Innovation through Partnering 186</p>
<p>Innovative Ways to Expand Access PayNearMe 189</p>
<p>How Innovative Banks Are Partnering for Innovation 190</p>
<p>The CEO–CIO Relationship Driving the Innovation of ING DIRECT Canada 190</p>
<p>A Whole New Era 193</p>
<p>How Banks Can Compete in the Future 194</p>
<p>Three Imperatives to Partner for Innovation 196</p>
<p>A Venture Capitalist s Look at the Future of Banking 198</p>
<p>Technology as an Enabler and Partner 205</p>
<p>What the Next 50 Years Might Hold 206</p>
<p>Digital 207</p>
<p>Relationship Management 207</p>
<p>Platform and Identity Friendly 208</p>
<p>The Future Bank Bundle: Platform–Relationship–Utility 208</p>
<p>Notes 209</p>
<p>About the Author 211</p>
<p>Index 213</p>