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Citigroup (NYSE:C) has joined the growing number of banks that have hired chief digital officers.
March 25 -
First National Bank of Omaha is preparing to host its second hackathon to foster new ideas and relationships with coders who could end up working from the bank.
September 5 -
If the Apple Watch catapults wearable computers into the mainstream, as some observers expect, banks will be tasked to reimagine the way they provide financial services features to their customers.
September 19 -
American Express is seeking ideas from outside researchers on how to cater to underbanked consumers and potentially refine its Serve prepaid account.
September 12
Citigroup is seeking help from outsiders to develop apps that will work with the so-called "Internet of things" and wearable technologies.
Internet of things which refers to home appliances or other gadgets that connect to the Internet and communicate with other devices is a nascent tech category that is expected to transform companies. It promises "
Citi's
"Innovation can no longer be just internal," said Stessa Cohen, research director at Gartner.
Citi will make available a set of APIs (application programming interfaces) to individuals around the world selected to participate, and invite them to create apps for mobile devices, the Internet of things and wearable apps. An internal team from Citi will select applicants who can code while a panel of judges will determine who participates on one of three demo days.
The innovation initiatives underscore what banking execs have publicly stated: They
And the call to coders coincides with Apple's announcement of its new mobile payment platform,
The tech brand's product news could spark wearable app ideas with Citi's participating developers in addition to serving as a catalyst for broad consumer adoption of smart watches.
"We are lucky with the timing," said Heather Cox, Citi's chief client-experience, digital and marketing officer for global consumer banking.
Citi is preparing for when people expect an experience that is deeper than downloading an app and viewing data presented on a flat screen, Cox said. Such services "won't quench [consumers'] desires in the future," Cox said. "Banking needs to be more exciting."
In fact, Cox would like to see a day where banking engages someone so that when he wakes up, he checks in with his bank app the way he might already with a Fitbit.
"Money matters in people's lives," she said. "Wearables will create a new kind of demand that can be fueled by biometrics think even safer payment mechanisms with multi-layer bio-authentication as the security layer."
Crowdsourcing tech ideas is but one of the more recent methods banks are using to help inform their innovation pipelines.
And
Mary Monahan, executive vice president and research director of mobile at Javelin Research & Strategy, expects banks to use hackathons for a long time to come to try to keep pace with shifting consumer behavior.
"They have to reinvent themselves," Monahan said. "If banks can't fulfill consumers' digital needs, they will go elsewhere. Geography won't matter as much."
A hackathon, meanwhile, could help a bank discover coders while they are free thinkers, untainted by corporate employment.
"Sometimes it's easier to innovate when you don't know the rules," said Monahan. "Once you know all the problems, it's harder to go outside the box."
Citi's new challenge, for example, is an extension of a contest it had been running internally and follows a successful event it ran in Latin America last year. The contest had more than 150 participants from 19 countries. The latest event, dubbed Citi Mobile Challenge, is meant to also serve as "a fun way to stir the pot and generate good ideas," Cox said.
To rethink digital banking apps, selected developers will be able to access a limited set of Citi's APIs more details will become available on Oct. 10 to create apps and have a shot at cash prizes, a potential contract with the bank, face time with banking execs, and mentorship possibilities following the challenge.
Participants will retain intellectual property rights for their software codes; however, Citi will have the option to license the software.
Citi partnered with numerous companies on the upcoming challenge, including Intuit, Plug & Play, Wearable World, FinTech Innovation Lab, Endeavor, Yellow Pepper, Women 2.0, Gimbal, Empire Startups, UK Trade & Investment and Fintech Hackathon.
The bank, which is preparing to launch one of the winning technologies from its Latin America contest, hopes the investment becomes a regular part of the bank's mix of efforts to find innovative idea. It also has an innovation lab and a ventures unit.
"There is no silver bullet in this world of innovation," Cox said. "We don't know where the digital world is heading."