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BBVA Compass is in the early stages of developing a mobile-banking application for the BlackBerry PlayBook tablet. The Birmingham, Ala., unit of Spanish banking giant Banco Bilbao Viscaya Argentaria previewed a version of the application on Tuesday at the Future of Mobile Banking Conference in London.
June 21 -
To many banks, the tablet is just another mobile device, but some are finding that the bigger screen gives the iPad and its peers bigger potential.
January 27 -
When Apple declared its iPad tablet a new category of computing, a few banks looked at the device and wondered whether it was also a new channel for self-service banking.
December 29
Many banks choose to wait and gauge the popularity of shiny new gadgets before spending precious development dollars on creating new applications. Not BBVA Compass.
The bank has instead taken early bets on new devices to satisfy the early adopters in its customer base. Its latest move is to develop a mobile banking application for BlackBerry maker Research In Motion Ltd.'s PlayBook tablet, a lesser-known rival to Apple Inc.'s iPad.
"Yes, we're taking a gamble, absolutely," said Alex Carriles, a senior vice president and the director of mobile and internet strategies at BBVA Compass. "Do we know for a fact that this is going to be a very successful platform? I guess nobody knows. But the fact is we have the opportunity of taking the lead on a platform that we know is very strong and has a ton of marketing support behind it."
The Birmingham, Ala., bank previewed the app last week at the Future of Mobile Banking Conference in London. The app, which is expected to be available in the third quarter, will allow customers to manage deposit, loan and credit card accounts, check balances, view check images, transfer funds between BBVA Compass accounts and perform other tasks available on the bank's existing app for the iPad.
Investing in a new tablet, especially one from RIM, might seem counterintuitive given that the BlackBerry maker is struggling for market share amid gains by Apple's iOS and Google Inc.'s Android mobile operating systems.
While banks with a large audience of business customers will likely continue investing in apps for RIM devices because of the BlackBerry's dominance in the corporate world, analysts have said some financial institutions that have BlackBerry apps may eventually phase them out if Apple and Google keep gaining ground.
The PlayBook may make sense for banks that have seen significant adoption of BlackBerry mobile apps, since users must pair the device with a BlackBerry for a data connection away from a WiFi router.
"Because of that tight connection between the smartphone and the PlayBook, it may not be as odd a choice as it seems on the surface," said Emmett Higdon, the principal of the consulting firm Prizm Strategy in Charlotte, N.C.
"If they have significant penetration in the BlackBerry space, then it makes a lot more sense," he said.
The bigger question for banks is "less about which tablets to support" and more about "what the hell are we going to do with tablets," Higdon said.
BBVA Compass, which is part of Banco Bilbao Vizcaya Argentaria SA, said it prefers to be first to market on new platforms to stay competitive. Last year, it was one of the first banks to release an app specifically for the iPad, whereas other banks simply adapted their existing iPhone apps.
"If this is something that our customers are going to embrace, we want to have our mobile app available for those users," Carriles said.
Outside the U.S., ING Group NV shares BBVA's philosophy.
Its ING Direct Canada unit released a banking app for the PlayBook in April, citing strong usage of BlackBerry devices among its customers.
"We looked at our own stats, our own customer base," said Charaka Kithulegoda, the chief information officer of ING Direct Canada. "We knew their behaviors and made some educated guesses that people will be using this type of device. … Our approach is to provide people the tools that they need independent of their device to manage their money." Both Carriles and Kithulegoda said that developing an app for a new device is less risky because they are able to piggyback on existing technology frameworks they created for other mobile and tablet devices.
"You still have to do the personalization" for specific platforms to develop "the actual application that runs on a particular device to present that data properly," Carriles said. "But you're looking at basically doing 30% of the work instead of having to do 100% of the work."
With many banks still trying to figure out the return on investment for mobile banking apps, developing apps for any tablet device is still an open question for financial institutions.
Android had 36.4% of U.S. smartphone subscriber market share as of April, according to the most recent data available from comScore Inc. Apple had 26% market share, followed by RIM (with 25.7%) and Microsoft Corp. (6.7%).
Tablets will likely figure more into bankers' development plans as the devices become more common.
Tablet sales worldwide are expected to reach 108.2 million in 2012, up 55% from 2011 estimates, according to Gartner Inc.
A May report from Forrester Research Inc. found that the return on an investment for mobile banking efforts is 15.7%, using calculations based on a hypothetical U.S. bank with 500,000 retail deposit customers and an average mobile banking adoption rate of 16%. Forrester found that the size of an institution largely determines the benefits. For example, using a hypothetical bank with 250,000 retail customers, the ROI would be -13%, "even if it were able to cut costs by one third," the report said.
