By Robert McGarvey

 

For Credit Union 2.0

 

The Citi 2018 Mobile Banking Study told us what we should already have known: consumers love a decent mobile banking app.  And they use it a lot.

How often? Citi said that mobile banking apps come in third, after only social media apps and weather.

That’s based upon a survey of 2000 US adults.

How often do your members use your app?

The question is not theoretical.  It’s in your face, life and death.  If your members don’t like your app – and I personally dislike the apps used at the two credit unions I belong to – what’s your future look like?

Almost half – 46% of consumers – told Citi they have increased their mobile usage in the past year.  Nearly two thirds of Millennials have done same. Expect that number to keep trending higher. As more of us discover that we can easily do most routine banking chores on a phone, we’ll migrate there – especially if we get the message that generally a mobile phone banking session (via cellular) is more secure than the same session on a Windows computer connected to WiFi.

Citi threw more numbers at us. 8 out of 10 of us use mobile banking nine days a month. One-third of us mobile bank 10 or more times a month.

91% of us prefer mobile banking over a visit to a branch – and don’t expect that number to decrease. Branches are dead, except for special purposes. If a consumer needs a wire transfer as part of a home purchase, sure, he/she may go to a branch (I did exactly that five years ago); it just seems simpler.  But for routine banking chores – including check deposit – it is vastly more time efficient to do it in one’s home, work, or car.

Personally I just deposited three checks via MRDC and transferred money from one account to another, all done at my desk, all done within five minutes. Going to a nearby branch would have eaten up at least 30 minutes and who has time for that?

Not many of us anymore.

“Mobile banking usage is skyrocketing as more consumers experience the benefits of greater convenience, speed and financial insights driven by new app features and upgrades,” said Alice Milligan, Chief Digital Client Experience Officer, U.S. Consumer Bank, Citi, in a press statement. “Over the past year we’ve witnessed this increase in engagement first-hand, with mobile usage in North America increasing by almost 25 percent, and we don’t see this trend slowing down any time soon.”

Mobile banking users also told Citi they feel more in control of their finances.  95% believe they know their exact balance right now, compared to 85% of non users.  Citi elaborated: “Nine out of ten (91 percent) have experienced additional positive outcomes from mobile banking, including greater awareness of their financial situation (62 percent); fewer concerns about managing their finances (41 percent) and a better understanding of the services offered by their bank (38 percent).”

Now for the bad news for you.  Read this: “Milligan added: ‘At Citi, we launched over 1,000 digital features in the U.S. in 2017, a nearly 500 percent increase over the previous year, and we continue to reimagine the client experience through innovative capabilities that deliver ease and simplicity for our cardmembers. In recent months, we have introduced a number of features to further enhance protection and security, such as face ID sign-on for the Citi Mobile App on iPhone X and email notifications when we detect unknown attempts to access customers’ accounts.’”

How fast are your vendors upgrading your apps?  Judging by the ones at my credit unions I’d say not frequently.

Not nearly often enough.  Not nearly enough to keep pace with the likes of Citi and Chase.

Can you say better about your apps?

You need to be able to,  That’s the reality for today.

When I talk with senior executives at many credit unions a common complaint about their apps vendors is that upgrades come too slowly.  It’s rare that I don’t hear that complaint.

But just maybe it’s no longer good enough just to complain.

Take action to make faster – richer – upgrades a regular reality. That’s how to survive today.

By Robert McGarvey

 

The headline on Ron Lieber’s New York Times column grabbed me:  Why Airline Credit Cards Have an Enduring Appeal.  

That’s because – although I’ve consciously shed credit cards in recent years – I presently have two airline credit cards and often find myself eyeing a third.

The reason: as I move into a post loyalty world where I have status on no carrier, airline credit cards give me many things that I used to get when I had status.  With them in hand, I feel no pain at the loss of elite perks because I am buying what I need with the airline plastic.

Airlines, in their greedy rush to grab up non traditional revenues streams such as credit cards, have given us all a backdoor that lets us avoid scrambling for elite status but still enjoy all the perks.

Of course I at first balked at adding airline plastic to my wallet. Then a reasonable review of the perks persuaded me of my errors.

Lieber said that at first he too was skeptical about loud claims for successes of airline credit cards.  But then “I looked in my wallet. After years of fealty to my trusty Starwood Preferred Guest credit card, I, too, gave in last year and picked up cards from American Airlines and Delta.”

Me, when I lived in Jersey City I had only a Continental (United) card because at EWR that was plenty. In Phoenix, where I now live, no carrier has similar hegemony so I have the United card, supplemented by an American Airlines card, and I frequently eye the Southwestern card but have thus far resisted.

An irony in all this, and reported on by Lieber, is that we are in an era of skepticism about the value of airline miles.  When you can earn them doing just about anything and when carriers frequently make flight rewards seemingly forever out of reach, there are plenty of reasons to view miles with a jaundiced eye.

But the card issuers and airlines know that.  Yes, the cards accumulate miles on purchases.  But they do a lot more. Lieber quoted Brian Kelly, aka The Points Guy, on what really matters with airline cards: “As points [miles] become more confusing and devalued, people turn to perks — and they are easy to see and easy to value.”

Kelly continued: “The issuers are doubling down on perks, and it appears to be paying off.”

Talk about coincidence. This morning’s mail brought a thick envelope from United/Chase regarding changes in my card -the basic Explorer Card ($95 annual fee) – and there’s an avalanche of new perks, effective June 1.

Continuing benefits include: a free checked bag; 2 United Club passes annually; priority boarding; no foreign transaction fees; 2 miles per $1 spent on United purchases; 1 mile per $1 on other purchases.

I always buy United tickets on this card, which gives a mileage bonus. And I am in it because of the priority boarding which means that just about always overhead bin space is available.

New benefits include: 2 miles per $1 spent at restaurants; 2 miles per $1 spent on hotel accommodations; 25% back as inflight purchases (food, beverage, WiFi) on United; and reimbursement for Global Entry or TSA Pre.

Count me as loving the Global Entry reimbursement – I’ll sign up tout suite.  And I like the 25% refund on inflight purchases.

That $95 fee pays itself back lots of ways. Nope, I will not use the card anywhere except where there’s a direct United tie-in. But, in those cases, I now find it indispensable. 

Ditto for the $95  Barclays/American Airline Aviator card.  Its benefits aren’t quite as rich – no club passes, for instance, and no reimbursement for TSA Pre or Global Entry.

But the AA card offers priority boarding, free checked bag, 25% credit for inflight purchases, a 7500 miles discount on certain rewards trips, and trip cancellation/interruption coverage in at least some cases. There’s also a 2X mileage award for American Airlines purchases and 1X on other purchases.

I’ll be surprised if Barclays too doesn’t sweeten the pot with more perks for cardholders soon.  

Word of advice: if you have an airline card, check the perks. They may well have recently been upgraded (the reimbursement for Global Entry on the United card was news to me).

Do you need an airline card? My advice is – if you don’t have high level elite status with your primary airline – the $95 a basic card costs could well be money well spent. Check the benefits for your airline – the differences between the Chase and Barclays cards are big enough to matter for some travelers. All airline cards are not created equal.

And if you see $95 in benefits for the card you want, take the plunge.

Most cards also waive the first year fee and throw a basket of free miles at new cardholders (typically 40,000 or a little more).

To me, this is a no brainer.

But your math may well differ.

 

By Robert McGarvey

 

For CU2.0

 

The April CUNA Mutual Trends Report drops a paradoxical bomb that leaves us confused: are credit unions getting bigger? Or are they vanishing?

First the good news: more of us belong to credit unions, reported CUNA Mutual.  “Credit union membership growth was on a tear during the first two months of 2018, adding 850,000 new memberships versus the 650,000 reported in the first two months of 2017.”

CUNA Mutual went on: “Credit unions should expect membership growth to exceed 3.5% in 2018. This will push the total number of credit union memberships to 117.6 million by year end, which is equal to 33% of the total U.S. population.”

Roll back to 1960 and, per NCUA data, just 6 million of us belonged to federal credit unions.  A similar number belonged to state chartered institutions. That’s 12 million total, out of a US population of 180 million.  That’s about 6.7% of us, far below today’s one in three.

Plainly, a lot more of us belong to credit unions now, probably because of expanding FOMs and also because many credit unions offer tempting deals – for used car loans, for instance, and in some markets home mortgages – that bring in members at least for those specific products.

More credit unions also are working smarter and better at communicating that their membership is pretty much open to all. There remain some of us who believe they can’t join a credit union because they don’t belong to a union – but those numbers are shrinking.

Member growth is good.  But do the CUNA Mutual data mean the credit union movement should pop open champagne and toast the good times?

Maybe not.

At least not just yet.  There’s more to digest in the CUNA Mutual data dump.

Toward the end of the report, CUNA Mutual serves up these disturbing numbers: “As of February 2018, CUNA estimates 5,757 credit unions are in operation, down 240 from February 2017. The pace of consolidation in the credit union system is accelerating due to the following factors: retiring baby boomer CEOs, rising regulatory/compliance burdens, low net interest margins, rising concerns over scale and operating efficiency, rising competitive pressures, and members’ demand for ever more products, services and access channels. NCUA’s Insurance Report of Activity showed 9 mergers – 7 mergers were due to ‘expanded services,’ 1 for ‘poor financial conditions,’ and one for ‘lack of growth’ – were approved in February with a merging credit union average asset size of $13 million. This is a fewer than the number of mergers reported in February 2016 with a merging credit union average asset size of $10 million. We are forecasting the number of credit unions will decline 250 in 2018.”

Do the math. If the current rate of consolidation continues, by 2028 there will be a bit over 3000 credit unions.

In 1960 there were about 10,000 federally chartered credit unions, per NCUA.  

As for the membership growth, CUNA Mutual sees it continuing, sort of.  “The membership gain was partly driven by the 502,000 new jobs created during January and February, according to the Bureau of Labor Statistics, and by the tremendous growth in credit union indirect auto lending. During the last few years credit union membership growth has been highly correlated with job creation with the seasonally adjusted annualized growth rate exceeding 4% over the last year. With job growth expected to slow slightly in 2018 to 2.2 million, we forecast credit unions to pick-up an additional 4.0 million members.”  (Emphasis added.)

Many credit union executives, at least privately, of course grumble about indirect car loans because the “members” they bring in often limit their memberships to the car loan and they aren’t especially profitable.

Add this up and what’s the meaning? Credit unions need to do a much better job of expanding their relationships with members.  It is great to have an expanding number of members, it is not so great not to be creating more solvent credit unions.

The truly good news is that if one in three Americans belong to a credit union that is plenty of bulk to use to seek to grow the institutions organically.  For instance: get that indirect car loan borrower using a sharedraft account and a credit card and the credit union is onto something wonderful.

The alternative is to join the thundering herd of dying credit unions, many of which are like wildebeest in the Tanzanian Great Migration, there essentially to be picked off by predators.

Parse the CUNA Mutual data and just maybe the message is a double edged sword: grow membership, especially the right membership, and success may lie ahead. Or shrink into extinction.

That is the stark choice in front of today’s credit union executives.

 

By Robert McGarvey

 

Oracle has weighed in with a data rich report that basically says hoteliers think they know about our loyalties but they don’t know bupkis.  Said Oracle: “We’ve uncovered a surprising divide in perception between how businesses view loyalty programs and what guests really think.”

Put another way: what we have here is failure to communicate.

And that’s at the root of why, so often, hoteliers seem oblivious to what even frequent guests honestly want from their rooms.  

So often hoteliers seem to miss the obvious.  That’s a conclusion from the Oracle data, which explores loyalty programs and also our views on social influencers and hotel tech. It’s a mixed bag of data but the one consistent reality is that we are misunderstood by hoteliers.

What do hoteliers get wrong about us?

Oracle starts off by tossing this hand grenade: “Given the choice to revoke their personal information from hotel brands, more than 80% of respondents said they would. Yet loyalty programs are at the heart of hoteliers’ commercial strategy.”

Oracle said “misconception 1” on the part of hoteliers is thinking we give much of a hoot about their loyalty programs in the first place.  Said Oracle: “Hotels think that guests would openly sign up to every loyalty program…guests are much more selective, only signing up to programs with real relevance.”

61% of hoteliers think guests sign up for every program.  Just 24% of us say we do. Hoteliers think 6% of us rarely join any program. But 30% of us say we rarely do.

Count me in that group who often decline to sign up.  Why bother when there is nothing on offer that interests me?

Hoteliers think we covet the possibility of room upgrades and rolling, 24 hour check in – the kinds of perks doled out to loyal guests.  Do we?

Said Oracle: “Guests, however, are far less engaged in the programs than hoteliers realize.”

54% of hoteliers say their offers to loyal guests are “mostly relevant.”  But only 22% of us say they are. And 39% of us say offers are “rarely relevant.”  But just 6% of hoteliers think their offers are rarely relevant.

Those are wide perception gaps.  And probably the why of our hotel discontents.

The research veers into areas where I might not agree with its findings – do you?  For instance, 37% of us say “Hoteliers used and recommended by social media influencers are more trustworthy than those recommended by celebrities.”

And 32% of us said that social media influencers reviews are more trustworthy than generic customer reviews (think TripAdvisor).  

Are you on board with this perception of influencers – keeping in mind that they work for money and further keeping in mind that the Federal Trade Commission wants their postings clearly labeled as ads.

I’m not putting influencers down, just suggesting that the rush to embrace is premature. Some are very credible. Some aren’t.

As for hotel loyalty programs, what do we want from them? Oracle says – no surprise here – that we want more personalized offers.  In fact 90% say they find this appealing: “Personalized service from hotel staff that understand my preferences and show me relevant excursions, recommendations and offers.”

65% want offers based upon our past purchase history.

86% say they are willing to complete a questionnaire so that offers can in fact be more precisely targeted.

What we are saying is listen to us and we’ll tell you how to make these loyalty programs work better. Will hoteliers listen? That is the question.

As for hotel tech, 87% of us want to be able to check out rooms with virtual reality before checking in. Just 73% are keen to use Alexa or Siri in the room. Count me as a huge Alexa fan and while I own a Google Daydream I don’t recall the last time I fired it up.  I certainly wouldn’t just to “walk” through a hotel room before booking.  Would you?

Add this up and – still – we are left with a divide between what hoteliers think we want and what we truly want.  What’s strange is that hoteliers have a lot of data at their disposal – especially regarding loyal, frequent guests – and yet they just don’t seem to be using it.

That just may be the most baffling reality about 2018 hotels.  They have what they need to know. They just don’t know it.

 

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By Robert McGarvey

 

Big banks have rushed to embrace Zelle – the new breed person to person payment tool – and credit unions too are joining the queue.

And now there is news about rising rates of fraud and criminality involving Zelle.

Time for a rethink?

First off, why Zelle?  Part of the answer is in the immensity of its primary backers, such as Chase, Bank of America, Citi, Capital One, Wells Fargo, USAA, and a handful of credit unions including BECU, First Tech, Schools First, Star One. Many more institutions – credit unions included – are in the queue to go live.

Zelle makes it very easy to send money to anyone with an email account or mobile phone number and a bank account.  No Zelle account is needed.

Some years ago I tried an experiment where I sent small payments to people using services such as Dwolla and the redemption rate was about zero. People asked me if I’d been co-opted by Nigerian scammers.  They just did not want to pick up money involving a service they hadn’t heard of.

Zelle is hard to not have heard of. A lot of TV ads and digital ads support it.

And then there’s how easy it is to get the cash.

Consider this a death warning to legacy but clunky services such as PopMoney.

But the trigger that launched Zelle was the PayPal fueled fire around Venmo which, out of nowhere, had emerged as the p2p tool of choice.  Bankers had snorted at tools like PopMoney but Venmo was different – users liked it, it had fintech heritage, and suddenly p2p was gaining the kind of enthusiasm many had predicted for it but that had stubbornly not materialized.

Bankers decided they needed their own weapon and thus Zelle, which in 2017 moved an estimated $75 billion, twice as much as Venmo, and the scariest bit is that this is plainly early days for Zelle.  Thought of a trillion dollar market is not far-fetched. Pymnts offered this dazzling buffet of Zelle stats: “Earlier this year, Zelle revealed that on average, close to 100,000 customers signed up each day for 2017. It also said it processed more than 247 million payments last year, which marks a 45 percent jump from 2016. It handled a total of $75 billion in peer-to-peer (P2P) payments in 2017, a significant increase from the $55 billion it made the year before.”

And now there are the stories about Zelle as a platform for fraudsters. The New York Times dropped the biggest bomb in a piece that began this way: “Big banks are making it easy to zap money to your friends. Maybe too easy.”

The Times continued: “Interviews with more than two dozen customers who had their money stolen through Zelle illustrate the weaknesses that criminals are using in targeting the network. While all financial systems are susceptible to fraud, aspects of Zelle’s design, like not always notifying customers when money is transferred — some banks do; others don’t — have contributed to the system’s vulnerability.”

Time to re-think Zelle? Not so fast.  Three years ago I wrote a piece for The Street headlined: “Are Peer-to-Peer Money Transfer Apps Unsafe to Use? Worries Focus on Venmo.”

The story started this way: “The Internet has been abuzz for a couple weeks with chatter about documented cases of theft of money from accounts of users of Venmo, the p2p (peer-to-peer) money transfer app that had been the the fast growing darling of Millennials.

One user, in a story reported in Slate, had $2,850 looted from a Chase checking account.”

Sound familiar? Indeed, it sounds exactly like the Zelle growing pains.  Regarding Venmo back then, PayPal told me they had moved fast to put in more security. File this under problem solved was their message.

Similar is getting said about Zelle.  Lou Anne Alexander, head of payments at Early Warning which runs Zelle, told the New York Times: “When there is a problem, we and the banks are proactive. It’s not something we’re putting our heads in the sand about.”

A lot is riding on Zelle for the banks and credit unions that embrace it.

There’s no present reason for a financial institution to panic about Zelle. If fraud reports continue and multiply, by all means, get worried. But for now this all sounds like growing pains and there are enough grown ups in the room to put in the needed fixes.

Color me optimistic.

 

By Robert McGarvey

For Credit Union 2.0

 

It’s been over three years since Apple Pay rolled out the nation’s first beefy mobile payments system and today’s blunt question has to be: does anyone still care?

Into that fray has stepped Pymnts which recently offered up a detailed look at mobile wallet usage, along with trends.

Be ready to question your own institution’s wallet strategy.

Be ready to ask if it’s in fact time for an institution that offers Apple Pay, et. al. to dump them.

The data just may surprise you.

For good reason. Apple Pay was birthed amid loud and wide clamoring for it. I remember the panic that beset many credit unions three years ago when Navy Federal was the first – and only – credit union invited to the launch party by Apple.  I had many talks with credit union CEOs and even more CIOs who wanted Apply Pay, like right now. And Apple put all of them in a deliberate queue where it took many weeks, sometimes months, before more credit unions joined the Apple Pay legions.

Every credit union wanted Apple Pay – even though they had spurned a very similar Google Wallet a few years earlier.  I had first used Google Wallet to pay at a Whole Foods in Scottsdale AZ in, I believe, 2013 which had Mastercard touch and pay installed on its registers and sometimes it worked with Google Wallet, sometimes it didn’t.  

But few credit union execs paid much mind to Google Wallet. It was Apple’s marketing genius that spawned a feeding frenzy where every institution craved a contactless payment solution.

Apple nowadays regularly updates its list of institutions that offer Apple Pay but I don’t think anybody much cares anymore.  More credit unions don’t offer Apple Pay than do – should they care?

That’s where the Pymnts data come in.

The article reminds readers of the famous S Curve, via Harvard Business prof Theodore Levitt, which posited that three years in, a new consumer product’s adoption should be at the top of the S curve.  Where does Apple Pay stand? Here’s what Pymnts says: “Apple Pay’s adoption since its launch in Oct. 2014 looks more like a flat line than an S-curve. In fact, the overall growth in Apple Pay transactions is almost certainly the result of more merchants installing near-field communication (NFC) terminals than iPhone users getting more interested in Apple Pay itself.”

Read that again – and remember that, per Apple CEO Tim Cook, Apple Pay is now accepted at more than half of all US retail locations.  And yet even Cook said that mobile payments have “taken off slower than I personally would have thought if you asked me sitting here a few years ago.”  

How bad is it?  According to Pymnts, under 30% of Apple iPhone owners have activated and tried Apple Pay. That’s terrible but just 17% of Samsung owners have activated and tried Samsung Pay.  And only 13% of all Android users have activated and tried Android Pay (nee Google Pay, nee Google Wallet).

Remember Levitt’s curve.  These are awful adoption rates.

Pymnts tossed out more gloomy data. Just 23% of Apple Pay users used it for their last transaction at store where they could use it.

And a dismal 17% of Android Pay users did likewise.

(Pyments, by the way, is reasonably bullish on WalMart Pay and its adoption.  I don’t shop at WalMart so I defer to other opinions.)

Bottomline: Apple Pay has its fan base but it definitely isn’t huge. Data is no more compelling for Android Pay and Samsung Pay. There is a user cohort – but, really, mobile wallets are still not wowing that many consumers with their alleged advantages over plastic cards.

The big question: if you don’t presently offer Apple Pay and Android Pay should you?  That depends upon your demographic, now and also the one you want five or ten years from now.  If your members want mobile payments, give them what they want.

Which bring us to the should you dump the mobile wallets?  Absolutely not, multiple credit union senior execs told me.  They in fact expressed delight that the mobile wallets are not much used – Apple Pay for instance charges a significant premium over a credit card as such and no credit union is thrilled about paying the difference. And yet credit unions that offer Apple Pay, etc. nonetheless get to proclaim themselves on the tech cutting edge and that’s a potent marketing platform, especially with Millennials.

For some credit unions, the present situation is win – win.  They brag about their techie cred and yet they aren’t stuck with paying the premiums involved in mobile wallet usage.

So don’t dis non use of the mobile wallets. It just may be exactly what most credit unions honestly prefer.  

 

By Robert McGarvey

 

All of us are atwitter about perceived loss of privacy when it comes to the acres of our thoughts, photos, outbursts that we have posted to Facebook and which, apparently, could be harvested by third party buyers.  

But just maybe business travelers have a much bigger worry that should consume them: the safety of their personal data that is in the hands of the hotels where we sleep.

“Bigger?” Yes, definitely.

And that is not to minimize the size of the Facebook mess.  If you want to see how to check what data Facebook has on you – just about everything you’ve done since you signed up – and with whom it has shared much of it – just about anything with a checkbook – read Brian Chen’s NYTimes piece on this.  It’s quite easy to check and, in my case, I got my file from Facebook literally a few minutes after requesting it.  I’m not a terribly prolific Facebooker – your mileage may vary. Did I see anything that made me sick? Nope, but I have always been prudent about what I posted to Facebook, mainly because I understood that the business model of the free Internet services is to harvest user data and sell it to marketers and fellow travelers.  That is baked in. I am not sure there is a way around it. (Read my 2000 interview in MIT’s Technology Review with Google’s founders.)

Back to your hotel worry. Hotel lawyer Jim Butler wrote this: “Protecting guests’ information (and employees’ information) from hackers is one of the biggest business challenges faced by hotel owners today. ”

Hotel breaches have been epidemic in recent years.  Here are many accounts.  

Traditionally the focus have been on theft by hackers of information involving credit and debit cards used at hotels – and bars, restaurants and gift shops have been notoriously porous, so have loyalty programs – but what if the bigger concern is, well, your private info?

You check into the hotel.  You watch four hours of porn (maybe there’s a Stormy Daniels festival?). Drain the minibar’s Scotch.  Get in a loud, verbal argument with security over the volume of your TV. Maybe you go full gonzo and you use the in-room phone call up a local escort service for a little company.

Okay, that’s not you, nor me, but I have known business travelers who have done pretty much all of the above.

Here’s the rub: a good hotelier gets good by noting and collecting guest preferences.  I have a friend who told me he swore by Four Seasons because he personally dotes on very soft pillows, hates wool anything, and doesn’t like a bed covered with decorative pillows. Apparently Four Seasons noted his interests because as he traveled from city to city whatever Four Seasons he checked into knew his preferences and of course if he were forced into, say, a Ritz Carlton, they didn’t. And he grumbled accordingly.

Just how safe is that kind of data?  Could clever hackers find it?

All that kind of data is what data scientists call big data. And big data has emerged as a key to delivering us the personalized services we want without us having to ask.

Understand: credit card data falls under specific federal guidelines. It has to be handled with deliberate care.

That’s not necessarily so regarding guest preference data – big data – and a lot of it is not encrypted, not put under a meaningful lock and key.

Front Desk anywhere, in a blog post, noted: “For too long, the hotel sector has been viewed as a soft target by hackers seeking to steal guest data. While some hoteliers take guest data security seriously, there are still too many operators using inadequate technology and processes to fully protect data.”

Some hotel groups in fact promise to do a good job protecting your data. Here’s the Accor policy : “Confidentiality and security: We will ensure reasonable technical and organizational measures are in place to protect your personal data against alteration or accidental or unlawful loss, or unauthorized use, disclosure or access.”

Word of caution: ask at the hotels where you stay what the policies regarding guest preference data storage.  Be clear: we are not talking about credit cards. We’re talking about bedding and the many other little things that when they are done our way make a hotel stay much more comfortable.

The EU, incidentally, has a get tough attitude about data privacy.  Many companies that do business in Europe say they have brought those policies here.  And maybe some actually have.

If you have doubts about your data, ask and keep asking.

Personally, I want hotels where I stay often to remember me and to provide my preferences unasked. That’s what great hoteliers have always done and today’s big data tools make it easier to collect and share the random bits of information that shape who we are as a hotel guest.

I am all for that, when the data are shared within the hotels where I frequently bunk.

I just don’t want hackers to know what kind of pillows I like. 

Would you?

 

 

By Robert McGarvey

For Credit Union 2.0

 

Put the new Bank of America 2018 Homebuyers Insight Report high on your reading pile.  And you may find yourself reading it as a contemporary horror story. That’s because the central message of the report is that today technology has become inextricably intertwined with the homebuying process.

The question for a lot of credit unions has to be: can we continue to hold onto any mortgage business?

Steven Boland, head of consumer lending at Bank of America, wrote in the report: “Perhaps the biggest takeaway [in this report] is that NextGen technologies are here today, and their influence will continue to grow. Many buyers report they are already comfortable using technology throughout their homebuying journey, with room for evolution. Over the next decade, many even predict open houses will only be done through virtual reality.”

The future is coming, ready or not.

Credit unions have been gobbling up marketshare in mortgage origination.  Will that last?

In 2005 credit unions had about 1.9% of mortgages.  In 2014 that had grown to 8.3% according to CUNA.

But in recent years the headline in the mortgage business has been the rocketing growth of non banks such as Quicken which now has a bigger share than Bank of America and Wells Fargo.

Non banks in fact now grab five of the top 10 spots in mortgage origination. And Quicken Loans is in 1st place.

What is going on is found in the B of A homebuying report and that is why it is critical reading for credit unions that want to continue to stake a role in first mortgage residential originations.

A number that jumps off the page: 32% of us told B of A we are comfortable applying for a mortgage online.  

Just 20% of us like online dating.  Only 37% are comfortable shopping for groceries online.  

Think on that. Almost as many who are comfortable buying kibble and chickpeas online are comfortable with applying for a mortgage online.

The majority – 52% – of those who are comfortable with applying for a mortgage online are or already have done.

Personally I got a mortgage, via USAA, almost entirely online in 2013. In 2004 I did similar with Countrywide.  The tools exist, they work, and at least to me the online process is more comfortable and faster than doing it in a bank or credit union office.  A bonus is that at home I have all the necessary paperwork on hand. I honestly cannot imagine going through a mortgage application at a remote office.

And more of us are coming to think similarly.

The data goes on.  According to B of A, “92 percent agree that technology makes them feel more in control of their financial decisions. They also see technology playing a role during every stage of the homebuying journey.”

One interesting data point from B of A: 4% of us say we’d make a home purchase offer based only upon an online review of the property.

Surprised it’s that many? I’m surprised it’s that few. In 2004 I sold a home in Tucson to a buyer in Hawaii who had seen the house only online. She made a full price offer.  She did want a contingency where she could pull out at closing if the house had been presented deceptively. I knew it hadn’t been, I consented, and at closing she did the deal.

Expect more changes. According to B of A, in the next 10 years 55% of us expect the mortgage process to be paperless.   I’m surprised that isn’t 90%.

53% expect the process can be completed within a few days.  Note: some lenders already promise same day approvals and that will become the new norm. Some promise approval in minutes.  

6% of us expect appraisals to be done by drones in the next 10 years.  Count me in the 6%, at least for production houses and condos. Already many appraisals are drive-bys.  A drone is just an extension of that trend.

What’s the lesson to learn from these many data points? The main one is: go digital. Make sure your credit union has an online application process that works. Really. Honestly. Ideally, both in a mobile app and online – but definitely online.

Lack of a good online mortgage app is becoming a deal breaker for many.

How good is yours? Get a half dozen friends – not credit union employees – to go through the online process. Gather their feedback. Did any quit in exasperation?  How many made it to the finish line? How long did it take them. (And do cancel out all the apps before the process moves to the next stages or you will lose friends.)

Don’t be shocked if there are loud grumbles about your online mortgage processes.  That may be the credit union norm. But it’s not good enough. Not today. Definitely not tomorrow.

We are coming to a time, very soon, when most mortgage applicants will expect to do this online, just as the vast majority of credit card customers expect.

That is tomorrow’s reality.  Get ready for it today.

 

The 21st Century ATM – CUInsight http://bit.ly/2v5pKUz

 

by Robert McGarvey

 

Can you om your way to happiness at 30,000 feet? Or at least to a state of heightened comfort?

That is the question that popped into my mind when I saw a story in Well + Good headlined, “Finally Airplanes Are Doing Something to Make Flying Less Stressful.”  The story’s pitch: airlines are taking steps to, well, make flying less stressful.

Are they giving us more pitch in coach? Making seats wider? Filling fewer seats? Pouring decent and free drinks? Serving edible – real – food?

None of the above.  Apparently – and Well + Good cites a NYTimes piece as backup – airlines led by United and JetBlue now are offering free access during flights to the popular meditation app Headspace.

Headspace is an entirely sincere meditation app company that has won substantial success as a paid app.  It’s gotten acres of press.  The basic plan is a monthly subscription ($12.99/month, or $7.99/month on an annual subscription) and lots of people praise it.

I’m not putting Headspace down.

I’m not putting meditation down.  I’ve personally put in hundreds of hours meditating at Shambhala’s Chelsea space and I have pointed a number of friends there.

No, I am not a meditation basher.

But when I read that United Airlines – that United, of Dr. Dao infamy and the recent death of a little dog — thinks that if we meditate we may be more tolerant of the airline’s gaffes, well, no.  Count me out.

Other airlines also are piling onto meditation, reported Well + Good. BA, apparently, has an inflight entertainment channel that offers meditations.  Swiss Air and Cathay also have offerings.

Let me inject some skepticism. As a veteran of many hours on the cushions at Shambhala I can assure you that – even with excellent in-person instructors leading small programs – it takes a lot of practice to begin to get the hang of meditating.

How does it go wrong? Let me count the ways. The essential issue is that to successfully meditate one must still the mind – in Shambhala’s case this revolves around a focus on the breath – and that just is not easy for a beginner.

It is especially not easy in a stressful situation and flying in today’s crowded coach, with grumpy passengers and not enough space, is a prescription for a stressful situation.

Go ahead, try to hold focus for 10 minutes. You probably can’t. If you get to five when you are beginning, kudos to you. You’re a natural.

Longtime meditators, many of them, have trouble going beyond 20 minute sessions.

How long is that flight, by the way?

Meantime, I’m looking at a 2015 article in Fortune that said “The average seat pitch, a rough measure of legroom, has dropped from 35 inches before airline deregulation in the 1970s to about 31 inches today. The average width of an airline seat has shriveled from 18 inches to about 16 ½.”

Pitch on some airlines has fallen to as little as 28″.

You think meditation will help you with that?

In India, there are holy men called sadhus who are said to be able to meditate for years. Some even master lying on a literal bed of nails (photos here). I suppose that being able to like a bed of nails might be a good prerequisite for a flyer in 2018 coach.

But is that a reason to take up meditation?

Personally, I really, really dislike seeing wonderfully good things – and meditation is one of them – co-opted by companies that deploy them in what looks to me like an attempt to get us to accept unpleasant accommodations.

“Stop your whining and meditate!” That is the only way I can interpret what some airlines seem to be practicing. It certainly is cheaper to shovel a meditation app our way than to actually address the deplorable conditions in coach.

Incidentally, there are many dozens of meditation apps – some free – in both Google Play and the Apple App Store.  Download a few, try them out, make it a DIY project. You don’t need an airline’s nudge.

Here’s a free YouTube video where Shambhala founder Chogyam Trungpa teaches meditation.

Here’s a short how-to write up by Trungpa.

You just may find meditation is exactly the thing for our age of stresses.

As for the matter at hand, can I personally attest that my hours of meditation study have made me a happier flyer?  I cannot.

But an unexpected upgrade to business class still works magic on my mood.