The internet name many banks are afraid to use

After Farmers & Merchants State Bank in Archbold, Ohio, switched its internet domain from dot-com to dot-bank, it got a handful of calls from customers wondering where its website had gone.

The $1 billion-asset bank also noted some assumed when a sentence ended “.bank.” in its promotional materials, the last period was part of the web address, instead of perfect punctuation.

“We had to rework the sentence,” said J. Marty Filogamo, the bank's marketing manager, chuckling.

Farmers & Merchants is one of only a few hundred institutions that have made the switch to the generic top-level domain that became widely available in mid-2015. While the extension is supposed to signal a bank is, in fact, a bank, the domain is still not available to most bank customers.

As Filogamo sees it, the bank’s conversion — which also included changing employee emails — was worth the work because it sets the bank apart and will help assure customers the bank is what it said it is online. The subtle change, after all, is meant to convey credibility, much like a FDIC seal does.

“Anybody can have dot-net or dot-com,” Filogamo said. “Not everyone can have dot-bank.”

The fTLD Registry Services is the coalition that controls dot-bank and helps vet which companies — core vendors included — can license the top-level domain through its partner Symantec. The mandatory verification and re-verification of dot-bank domain registrations also requires those who switch to the extension to follow security safeguards, such as obtaining a digital identity certificate.

Though Farmers & Merchants is one of the more than 2,300 U.S. registrations for dot-bank, it is only one of several hundred that have converted domains thus far. The reasons range from still evaluating the domain's value to waiting for the right time to switch.

Mercantile Bank in Grand Rapids, Michigan, for instance, bought a few of the domains to lock down availability, but the innovative bank has no short-term plans to convert to a new address because of the marketing expense and concerns about customer impact.

“I am not sure when and if we’ll do it,” John Schulte, Mercantile Bank’s chief information officer, said in an email.

He’s not alone.

Shirley Inscoe, a senior analyst with the research firm Aite Group, said a number of bank execs are still evaluating whether to make the conversion. On one hand, the project has many potential benefits, including added security. On the other hand, the project requires training consumers on the significance of a visually subtle change, and even then, people could still fall victim to spoofing and phishing attacks coming from a dot-com address.

For other banks, converting the domain name may just be a matter of getting to it. Since dot-bank became available in 2015, Inscoe said, banks have been buried in major IT projects, such as EMV rollouts and faster payments. “It’s a prioritization issue I think,” Inscoe said.

If fTLD Registry Services has its way, that is bound to change.

Drew Schiff, director of engagement services at fTLD, said early movers were motivated for a variety of reasons, including the opportunity to own a unique, shorter URL or strengthen security. Others who defensively grabbed domains have been waiting because of concerns about costs and time required on what Schiff describes as “perceived complexity.”

But in the last three to four months, Schiff said, there has been a substantial increase in interest from its registrants to complete their migration to dot-bank.

“It’s trending up and in the right direction and that’s what we want to see it,” said Craig Schwartz, managing director of fTLD Registry Services.

‘Looking for a way in’

Farmers & Merchants knew right away it wanted to make the leap. The $3,500 it pays for its two-character domain annually and a $200 yearly fee for the domain name system were investments, it said, that would add one more layer of security as cyberthreats continue to soar.

“Bad guys are always looking for a way in,” said Mike Hess, the bank’s IT systems administrator.

So it was only a matter of waiting for the right moment. While the bank had the dot-bank extension since the fall of 2016, it waited to migrate to the new domain so that it could tie the rollout with the launch of its new website — an approach other banks have also used.

Lead Bank in Garden City, Mo., moved quicker than Farmers & Merchants to convert to a dot-bank domain. But just like the Ohio bank, the $200 million-asset Lead Bank used the conversion for another announcement: a new branch.

The dot-bank domain was a way to help distinguish the community bank in a new market, said Melissa Beltrame, director of marketing at Lead Bank. She also saw it as a way to boost Lead Bank’s security and prove that small banks aren’t tech laggards as some suggest.

Of course, no technology is impervious to online scams. Already, there are reports of phishing connected to newer top-level domains. And not all core vendors have made the conversion to dot-bank, which means consumers may first see a dot-bank domain in their bank’s website address, but not after they login (such is the case at Lead Bank).

Beltrame readily acknowledges there’s no cure all for scammers. She likens the dot-bank investment to a flu shot — it may not stop everything, but it strengthens the bank’s defenses.

Since converting more than two years ago, Lead Bank had to fix its dot-bank labeled emails from ending up in spam filters — which it accomplished. That aside, Beltrame said the bank hasn’t lost SEO value and consumers aren’t confused. “If anything, it created a sense of curiosity,” she said.

While the bank pays the registrar $1,000 annually, it values the investment — less than $10,000 so far in cost. Not only has Lead Bank shaved off some characters in converting to dot-bank, but the three-branch institution still gets cred for being an early adopter. “We only see upside potential,” Beltrame said.

While Beltrame realizes bank silos may be one reason more banks haven’t converted domains, she is perplexed that Lead Bank is still an early mover two years after flipping the switch.

“I can’t figure out why more banks don’t move to dot-bank,” she said. “It seems like a no-brainer.”