As summer begins, more of us will be taking some well-deserved vacation time, but business doesn’t grind to a halt just because you happen to be away from the office. That means more entrepreneurs and business executives will be relying on online and mobile banking tools to stay in touch with their business finances.
Given the need to access financial information in real time, what does the future hold for online and mobile banking? More importantly, how can these resources help business executives make better decisions for meeting their strategic goals — now and in the future?
Smart Business spoke with Susan Brown, senior vice president and Marketing Group manager at California Bank & Trust, about how online and mobile banking tools are helping executives not only access account information, but also provide sophisticated technologies for meeting complex business and treasury management needs.
Why has mobile banking become so important to business customers?
In today’s fast-paced business environment, you can’t afford to be out of touch with your finances. It’s become more essential than ever for entrepreneurs and their teams to have 24/7 access to a variety of business metrics, such as account balances, payables, receivables, cash on hand and more.
In the past, traditional online banking tools accessible via desktop PCs and laptops met these needs, but smartphones and tablets are now becoming preferred devices for accessing information. A recent report predicted that by 2014 smartphone shipments are likely to top 1 billion units, and that by next year sales of tablet devices will exceed sales of traditional laptops.
Data like this makes it clear that mobile devices are going to be key tools for business leaders to get more done in less time.
Has mobile overtaken online banking?
Mobile banking is not different from online banking — you’re just using a different device and tools to access information remotely. The more people rely on tablets and smartphones, the more mobile apps will grow in popularity. The most likely scenario for the near future is that most business users will adopt a hybrid approach, using traditional online banking tools in the office and mobile apps on the road.
Why is online banking expanding from transaction-oriented to customer-centric?
The best financial institutions are customer-centric. These banks focus squarely on strong relationships between their clients and business bankers. Clearly, customer-centric institutions want online and mobile banking resources and technologies to reflect and mirror those values.
Transactions are important, so of course online and mobile services need to support high-transaction volumes. However, the real value is banking experts helping clients make the best use of sophisticated tools to meet complex needs, such as cash management and fraud prevention. This is why a customer-centric approach will continue to be a focus.
Will the popularity of online and mobile banking impact the future of bank branches?
When online banking first emerged, many in the industry thought it might mark the end of branch banking. However, face-to-face contact is still important, especially in a business-banking context. Many transactions, such as those involving deposits and cash withdrawals, require a network of branches. There will be a gradual decrease in the number of branches, but branch banking isn’t going away anytime soon.
What online or mobile options are available?
Most people know they can pay bills online, check the status of payments and review balances, but there are other online tools that offer more sophisticated capabilities. For example, businesses can use advanced treasury and cash management solutions customized to meet highly specific needs.
What new capabilities under development could be used in the future?
Institutions are investing in user friendly and interactive websites, as well as introducing new apps that allow clients to service their banking needs from tools like mobile devices and iPads. As the capabilities of these devices grow and devices are introduced, banks will develop new, interactive ways to support their clients’ growing needs that complement the traditional avenues.
Susan Brown is senior vice president and Marketing Group manager at California Bank & Trust.
Mobile: To learn more about California Bank & Trust’s business mobile banking app, now optimized for iPads, visit www.calbanktrust.com.
Insights Banking & Finance is brought to you by California Bank & Trust
Technology tool-related capital investments, such as new software, mobile apps and cloud computing services, are as important as a healthy workforce to many small business owners. But you must be strategic about the technological applications you choose, using your goals as a guide.
“It’s a really exciting time for small business. For the first time, you have access to tools and solutions that may have been cost prohibitive in the past, and you can buy them by the seat and without the need to build and support an enterprise infrastructure. This allows you to build a cost effective, end-to-end automation platform that really impacts your business,” says Frank D. “Buddy” Cox, Jr., executive vice president and chief information officer at Cadence Bank.
Smart Business spoke with Cox about how businesses are using technology to operate more efficiently and cost-effectively.
What emerging technology is impacting business productivity and profitability?
Cloud computing, a modern name for traditional outsourcing, has not only grown in adoption, but reach also has been extended from a focus on the enterprise to small business. This shift away from having to build a robust, secure and resilient in-house infrastructure to support software solutions, and instead migrating to a model where all critical infrastructure is built, maintained and shared by the provider, makes most all enterprise-level solutions available to small businesses in a very affordable way.
With Microsoft 365, for example, you can fully leverage Exchange, SharePoint and other enterprise-level solutions for less than $10 per employee per month. Platforms such as salesforce.com, when combined with modern real-time accounting platforms like financialforce.com, allow for a level of work flow and integration once reserved for large scale implementations.
Another technology that’s transforming business is the mobile platform. For most, it has become a primary computing device, allowing people to conduct business anywhere and at any time. When leveraged as a part of an overall business automation platform, the results can be very meaningful.
How are these new technologies transforming banking?
Banks continue to work with businesses that are building end-to-end automation solutions by plugging in at the right points in the process to provide real-time financial information and transaction capabilities. This includes, in many cases, unique one-off solutions to support a customer’s proprietary automated framework.
In the mobile space, we have seen an unprecedented adoption curve. A survey conducted by Constant Contact in March found that 66 percent of small business owners currently use a mobile device, such as a smartphone or tablet, for work. That same survey revealed that mobile apps increasingly are becoming part of how small business owners manage operations. Business owners clearly want to run their businesses and conduct their banking from the palms of their hands. Strategically, we are very focused on building feature-rich, secure and easy-to-use mobile applications that positively impact the day-to-day operation of businesses.
Mobile also is a much more capable and rich development platform than anything that we have built upon in the past. For example, not only can you turn your debit card on or off using a mobile app, but by leveraging location services on your device, we allow you to specify the use of your debit card only if it’s within a certain number of miles of you.
What are some challenges with the adoption of this technology?
Moving your data to the cloud or carrying sensitive data around on your smartphone present risk. Privacy, security, backups and business continuity are all topics to vet. Understanding from your provider how your data is stored, if it is encrypted at rest, how it is backed up, who has access to your data and how that is being properly controlled is extremely important. Third-party audits can be employed to validate that all of this is in place and functioning according to design. You must hold your vendors accountable to the same high standard with which you would grade your own internal control environment.
Frank D. “Buddy” Cox, Jr. is executive vice president and chief information officer at Cadence Bank. Reach him at (713) 871-4000.
Website: Cloud computing services and mobile technology are changing the way businesses operate and serve clients. Learn more at www.cadencebank.com.
Insights Banking & Finance is brought to you by Cadence Bank
Is cash more important than profits? It actually may be, as profitable companies fail every year simply because owners don’t have enough cash to pay their bills.
The problem is so pervasive that the U.S. Small Business Administration cites insufficient capital as the No. 2 reason that small businesses fail. And insufficient cash flow may keep owners from making advantageous hires or acquisitions, or even from receiving a paycheck.
“It’s easy to lose track of cash when you are under stress and juggling multiple responsibilities,” says Pamela Glass, project manager and mobile and online banking expert with California Bank & Trust. “Fortunately, cash flow management doesn’t have to be a burden or an afterthought thanks to the availability of online and mobile banking.”
Smart Business spoke with Glass about the ease and advantages of managing cash flow through mobile and online banking.
What types of transactions are available through mobile and online banking, and what are the benefits?
Almost any banking transaction can be initiated over the Web or from a smartphone using a mobile application, giving business owners the opportunity to seize control and hang onto their cash longer. For example, instead of waiting to go to the bank, owners can make deposits any time and control the timing of invoice payments from anywhere in the world using their mobile device.
They can transfer money from a general account into a payroll account right before payday, schedule vendor payments, or pay sales and payroll taxes on the due date by initiating ACH transactions. Essentially, they have the ability to view and manage their company’s cash position at their fingertips 24/7.
How does online banking improve the accuracy and convenience of cash flow forecasting?
Business owners don’t have to wait for their monthly statements to arrive to close the books or reconcile accounts. Now, they can forecast cash flow, analyze trends and make advantageous moves by downloading transactions and e-statements over the Web. They can then import the information into accounting programs such as QuickBooksTM or Quicken®.
Having instant access to credit card transactions, loan balances, deposits and invoice payments helps business owners estimate cash conversion cycles, identify cyclical revenue trends and spot opportunities to put excess cash to work. Some owners have used the information to improve cash flow by offering clients discounts or other incentives for quick payments, while others have offset seasonal downturns by offering customers complementary services. Still others have launched month-end sales to reduce inventory and raise cash before large invoices come due. Online banking evens the playing field between small and large businesses by giving owners access to the same data and sophisticated analytical tools enjoyed by Fortune 500 CEOs without the hefty price tag.
How can owners use online bill pay to improve cash flow?
Online bill pay gives owners the tools and the confidence to negotiate discounts by making bulk purchases or paying bills on time. Because they always know their company’s cash position, owners can schedule payments in advance, wire funds or tap a line of credit to pay invoices. In addition, they can cancel or delay a payment if there’s an issue with a vendor’s product or service, and they can control cash outflow by giving employees specific authority levels and approving transactions online. Online bill pay reduces fraud, the number of errors and late payment penalties by making it easy for multiple people to review and approve every transaction.
How can business owners control cash by monitoring transactions online?
Owners can improve cash flow by tracking incoming wire transactions and initiating collections calls to tardy customers, or they can discuss a client’s payment history and terms during a visit by accessing data from their smartphone. Essentially, there is no reason to wait for payment when clients can pay invoices electronically or via credit card, and owners have the ability to monitor transactions online. But if a client wants to pay by check instead, owners have the ability to deposit the funds into their bank account on the spot from their smartphone.
From a business owner’s perspective,time is money, so one could say that online banking is a windfall. Employees can initiate transactions, balance accounts and make deposits right from the office, and owners can pay down loan balances, check credit lines or approve transactions from cabs, airports or coffee shops. Visits with a banker can center on strategy, revenue-generating opportunities and relationship building instead of on routine banking transactions.
Is online banking more expensive than traditional banking services?
Online banking costs no more than traditional services. In fact, it is more cost effective when you consider the cost of checks, postage, gasoline, employee time and travel. How much will you save by reducing days sales outstanding by a few days, paying down debt or avoiding fees and penalties by paying your bills or taxes on time?
Do business owners need a connection to process mobile or online transactions?
Online banking is accessible over the Internet or mobile Web. Mobile banking is available through providers such as AT&T, Verizon, T-Mobile and Sprint on a variety of devices, including BlackBerry, iPod Touch, iPhone and Android*. Given the convenience and ease of online and mobile banking, there is no reason why cash flow management can’t be a simple, daily activity.
Pamela Glass is a project manager and mobile and online banking expert with California Bank & Trust. Reach her at firstname.lastname@example.org.
Insights Banking & Finance is brought to you by California Bank & Trust