Malauzai Software’s Robb Gaynor on digital banking, mobile payments, and chatbots
- Community banks lack the deep pockets of larger financial institutions to spend on technology.
- There are software firms that provide them and their customers with the same mobile banking and payment tools big banks use.
We’ve been on kind of a kick here recently with the podcast, exploring trends in mobile finance and what’s driving mobile banking and retail payments. Today’s guest is Robb Gaynor, the chief product officer at Malauzai Software, a digital solutions provider for community banks and credit unions. The company counts as customers 450 of the 8000 or so financial institutions that fit this bill.
Robb is a self described “mobile banker” with almost 30 years experience in the space, beginning with a stint at Schwab in the pre-Internet banking days. Our discussion covers Robb’s experiences and observations about the evolution of self-service financial services, mobile banking usage trends, and even about what to expect from chatbots and conversational banking down the pike.
Below are highlights, edited for clarity, from the episode.
Evolving self-service banking
I got into mobile banking when I started at Charles Schwab many years ago, when we were online but prior to the internet. We had people using private networks. But the concept of automating someone’s banking relationship was there. I got lucky because Schwab was undoubtedly one of the pioneers. We were doing interactive voice response and then ATMs came along.
I remember when someone like a Sapient or a US Web came in way back in the 90s to tell us we could use this new public network. We thought they were crazy — we paid GE millions of dollars to manage our private network. But they were right — you could secure the public network and do internet banking. Fast forward from brokerage to Internet banking to mobile banking, and I’ve been in this space for 26 years.
Community banking’s challenge
You can imagine how hard it is for these small banks to compete against the larger banks with really deep pockets. These banks are small businesses — the average community bank has less than 100 employees. It’s important that they have the tools to succeed. We’re not alone in servicing this segment. There are a lot of great fintech vendors that enable community banks to do their jobs well and compete.
Digital banking insights
We love data and analytics and we do a lot of reporting. We aggregate our data across the institutions that use our software. We recently looked at transactions related to transfers of money within an institution and externally. People transfer money at very different rates — orders of magnitude in difference — based on the size of their screens. Bigger screens, bigger transfers. Android users are very different than iOS users. We also looked at the intent of transfers. We saw that half the transfers leaving checking went into savings and the other half went to spending. So, that’s interesting.
The world of mobile wallets
Think Starbucks versus Apple Pay. The world of mobile wallets seems to be divided between businesses offering payments and the Pays (Apple Pay, Android Pay, Samsung Pay). The business payment side is doing really well — one of every five payments at Starbucks happens over their app. The Apple Pay model is an aggregation model. All we know is that the Starbucks model is working, so we help banks offer their small business customers a payment app to use with their own customers. That’s our MOX Pay product.
Chatbots and conversational banking
The emergence of voice is going to impact digital channels. You’ll start to see a bunch of companies launching first generation products. There are two profound things that we hit on. The first is that conversational banking means that there’s going to be more than one question asked. A lot of Alexa apps are single dimensional. The other thing is that for the first time in history, we’ll start to use more than one device to interact with the computer. You’ll ask a question from one device and receive the answer on another. We call it the Star Trek Effect. It’s an interactive, parallel device experience.