The absence of near-field communication (NFC) in iPhone 5 has surprised NAB and other banks, according to NAB's technology head of strategy and innovation, Denis Curran. It’s an example of why banks must be agile with their IT strategy in an age of increasing digitisation, he said this morning at the Information & Data World Symposium in Sydney.
“We all thought that the Apple iPhone 5 would come out with NFC,” Curran said. NFC is the technology used in many Android phones to support Google Wallet and other mobile payment applications. “What will that do to adoption of NFC in Australia for mobile? How do we adapt our strategies to them?”
NAB previously had to adapt its digital strategy when the Global Financial Crisis hit, Curran said. The Ubank platform for deposits was originally supposed to be targeted at the lending market, he said. “But the GFC intervened in that. Lending was going to be completely unsuccessful and we switched proposition ... very quickly. It’s [that] sort of responsiveness you have to build into the DNA of the business.”
Change is difficult, especially for a 150-year old institution like the NAB and in an industry like banking that dates back to the 1400s, Curran said. However, banks must adapt to today’s “information industry” to reduce the “risk of substitutes, new entrants” and competition from rival financial institutions, he said. Consumers and businesses are forcing the change -— money, transactions and shopping are increasingly becoming more digital, and more and more people are moving online for social networks and knowledge, he said.
Curran highlighted competition in the payments area, with NAB watching “the PayPals of the world,” he said. Also, the Apple App Store “transacts more payments than just about anybody in the world”, and Curran is paying attention to what the company does with its Passbook app, he said.
NAB hopes to adapt by becoming an information-led business and a leader in managing data and information quality, Curran said. “We really need to put the 'I' back into CIO,” he said. “CIOs have become technology officers much more than information officers. We have to transition the IT organisation [and] make that far more about how we direct and support the strategy.”
NAB is “implementing new core systems, but it’s a multi-year journey,” Curran said. NAB will roll out a new voice infrastructure, “which would seem to be counter-intuitive, but we see a rebirth of voice,” he said. Also, NAB is “getting rid of a lot of the old application sets because of the inbuilt complexity they have,” and replacing them with “a more cogent set of more integrated applications”.
Security and privacy are critical to building trust, an essential element of banking, Curran said. “In a time where there is elevated concern” about security among the government, consumers and businesses, “we have to be great at security and privacy”.
Banks must also adapt to social media, he said. “Banks traditionally have been part of the social fabric. I think over the last 10 years we’ve lost a lot of that.”
NAB seeks to provide information anywhere, anytime and anyhow for its customers. That means supporting multiple types of devices running a variety of operating systems, Curran said. On mobile, it means supporting multiple information channels, including NFC, SMS and voice, he said.
Curran said the bank seeks to simply process and do things in real-time with strong resilience. “Over the years in banking, we’ve not really been that good at designing our manual processes. Often at times we put in new systems that get put in place in parallel to ... existing policies that are steeped in a lot of history and are extraordinarily hard to change, and so you make too many trade-offs through all of that.”
The bank seeks to speed up business decisions through accurate and timely data, and better manage end-to-end processes across internal resources and external partners, Curran said. The latter acknowledges that banks do not “live in a world of isolation; we are intermediaries,” he said.
ANZ Bank last week announced a trial of NFC technology.
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