Bank of America: The future is fast, smart and secure

Bank of America (BofA) clearly has an eye on technology and recently announced some interesting developments– including your CashPro solution being made available on Apple Watch. Is this a reflection on the tech-focus within the organization?

My role at Bank of America exists because we want to bring a strategic lens to our digital strategy across front, middle and back office – and across every single line of business. The wider consumerization of everything that is pervasive in our lives is now driving our CFOs and our corporate treasurers to expect the same digital experience when they interact with a financial institution like ours. So, we’ve created this new team within the last year to drive that strategy end-to-end.

Whether it’s a mobile, smartwatch, tablet, at your desk or, increasingly, API Connect file transfers, any way in which a client wants to interact, Bank of America is investing in that capability.

That’s great, but it feels like it could be a real leap into Tomorrow’s World for a lot of Treasurers. Are you finding that there’s real appetite from corporate treasury for this technology?

It runs the spectrum depending on the size of the company, the industry and the demographics. Take for example, that within the next year, 60% of the workforce will be Millennials and Gen Z! This population was born digital and expects three things from their experience: fast, smart, secure.

The focus therefore is on fast, intelligent data and information management; tell me what I need to know, when I need to know, in real time. But, they are not going to give up any security for that level of speed and that level of intelligence.

If we look at mobile specifically, some clients have enabled hundreds of users within their company to use mobile for things such as, in the U.S., depositing checks and making payment approvals. We’ve had CFOs approve over a billion dollars’ worth of transactions through mobile. However, other clients still have concerns about security when using a mobile device. Our response has been to build a kind of cyber ambassador programme that helps clients understand that mobile use actually enhances security. Almost 60% of our clients use biometrics to log in to their mobile app, which is an additional step in security. It takes education to get clients comfortable with using mobile but overall, Bank of America is seeing the pace of adoption accelerating.

What’s driving this acceleration?

Aside from the clear benefits of technology and the consumerization element, the pressure is on CFOs and treasurers from their CEOs to reduce manual processes and become more efficient. I had one client that created efficiencies in their workforce by adopting smarter tools to replace spreadsheets, data entry and manually performing Account Reconciliation. Through mobile tools they can have a workforce that’s more geographically dispersed, which is also a big demand.

Regulation within open banking has driven more investment in APIs and will continue to do so. This could also have the affect of driving transformation in areas where pickup has been slower to date.

Just picking up on the impact to the workforce. Are you seeing treasury teams pushing back against technology because they see it as a threat to their jobs?

Absolutely not, for two reasons. Almost every client I meet wants their staff to become more efficient and eliminate non-value added processes, such as manually reconcile accounts. They need advanced digital tools such as those we’re offering to do that.

We recently launched a webinar series on trends and treasury transformation, real time payments and how to prepare. One CFO said: “I actually had time to bring my team together and huddle around the webinar and have a strategic conversation, and that’s because we are now using tools that automate our processes.” How do we help our finance and treasury teams become more strategic? We have to free up their time, because they shouldn’t have to start at 7:30am to do Account Reconciliation. They should be able to arrive with the account already reconciled so then they can perform strategic analysis.

What are the key things that you’ve learned from within your organization when it comes to transformation and your strategic positioning between your treasury and CFO?

Our clients tell us that digital is increasingly becoming the differentiator when picking a financial institution. Or it’s driving their overall client satisfaction, even above their relationship with a banker. The key is having to equal strength in the relationship and the digital offering, which is the ‘high tech, high touch’ approach of our bank.

That’s why we talk a lot about user experience. How does it feel to interact with the bank? That interaction includes the contact at the bank – people have to be comfortable with that person. But then, can I do electronic signature? Can I do document upload? Anything where I don’t want to or need to speak to a person, is it fast? Is it secure? And is it smart?

We think it’s that combination of high touch and high tech, that obviously starts as a consumer, really transfers over to CFOs and treasurers. They want the personalization of dealing with an individual that has 30 years of experience, advising on, ‘Should I get a syndicated loan, should I do a structured finance, how can I free up working capital’ etc. That advisory piece is so critical, but then when it’s not advisory, you’ve got to make it really fast, really smart, really secure and easy to do business with you.

With the above in mind, what technology can treasurers and CFOs look out for and expect from Bank of America?

We’ve mentioned CashPro already, which is the key digital platform on the corporate commercial side. Within that we’re focused on four areas.

Number one is simplifying access to every aspect of the platform. You may be a controller that is responsible for information recording, or you may be a C suite level executive that has to do KYC twice a year so you’re not logging in every day. However, you’ve got to make it really easy when you do need access.

Number two is interoperability, which we talk about a lot, focusing on anytime, anywhere access across any device. If I’m a Deputy controller at my desk all day, I’m probably OK with all the online tools. If I’m the CFO, and I’m boarding a plane, and I’ve got to approve a critical payment so that I can get the inventory shipped out to my client, I want to be able to do that right on my mobile phone or on my tablet. And increasingly, API is an area where I want that connect 24/7. So, we’ve invested in all aspects of those technologies.

Number three is consistent experience. In the US we serve half of consumer households, we serve wealthy individuals, and we serve 77% of global fortune 500. We want brand consistency across all of those and the good thing is that we have a lot of opportunity to leverage. We spend $3bn a year just on new technology initiatives and we can leverage those dollars across the business.

Does that mean shifting treasury from being reactive into a much more proactive one?

I definitely think it will, and culture will be vitally important. It takes a lot of change internally, with treasurers and CFOs, to get their teams more comfortable with using digital tools and digital analytics. The convergence of high touch, high tech again comes to the fore. We have a dashboard that shows how clients compare within their industry, but they still want us often to come out and show them the dashboard.

Do I ever think it’ll come to a digital only world? I don’t think so because it’s the expertise that we share as a financial institution, especially on topics that aren’t a key focus every day, that will always be needed and crucial to an organization’s success.

You’ve spoken a lot there about change. This might be an impossible question but what sort of timescales are you looking at with this?

We really think that digital is not an initiative. It’s not a programme. Bank of America is in the digital revolution. Mobile adoption by our commercial and corporate clients is accelerating, so that’s an area where we’ve invested the last couple of years. Open Banking has driven APIs, and we’re starting to see traction. The list goes on.

We’re investing in technology that we’re rolling out every day. And then we’re also investing in technology that we’re going to roll out one year, two years, three years down the road. And all of these are running parallel paths.

We’re also thinking about how clients really want to consume information from us, move beyond transactions and think about research and real time information through mobile. And that’s probably six months, nine months, two years down the road. Digital transformation is really just beginning!