TINA'S TAKE BLOG

Musings from a community bank payments strategist and full-time hockey fanatic

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Positioning ICBA Bancard for the Future: What’s Your Why?

Jul 14, 2020

By Tina Giorgio 


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Back in 1985, the first Macintosh computer debuted, and by today’s standards, it was a boxy, clunky, slow unit, yet Consumer Reports gave it a glowing review and cited the mouse and use of icons as technological breakthroughs. This demonstrates a key point: 35 years is a long time when we consider the rate of technological change.

As ICBA’s payments subsidiary for the past 35 years, ICBA Bancard has always been acutely aware of this concept, and has worked to stay ahead of the curve to offer solutions that speak not just to today’s demands, but also to tomorrow’s needs. So, as we celebrate our history, we do so with that spirit of innovation, a strong foundation, and a vision to where we want to be three, five, 10 years in the future.

With that in mind, I invited Greg Deckard, ICBA Bancard’s chairman, and State Bank Northwest president and CEO, to speak with me about ICBA Bancard’s future direction. Excerpts from our conversation follow.

Tina: When we look to the future, I think we have to do it with the question of “why?” firmly in place. There are so many emerging solutions, new technologies, increased competition and let’s face it, competing priorities. How do you choose where to focus resources? It simply has to come down to your “why”.

Greg: I agree. The good news is that the pace of innovation continues to accelerate. The hard part comes in figuring out the products and services that address business objectives. If you’re not firmly anchored in your strategic plan—your explicit why—it can be daunting. I think that’s where ICBA Bancard does a nice job of helping community banks cut through the noise and find solutions that speak directly to their payment needs.

Tina: And so much continues to emerge. Take faster payments. The Federal Reserve’s FedNow real-time payments option will be coming online. This signifies a new era and a hefty investment both strategically and operationally. This will require community banks to re-imagine their technology infrastructure for not only how it can be implemented operationally, but what that means for product offerings. Questions that must be addressed include: What competitive advantages will faster payments create? Why are they needed? And how do you prepare for that sea of change now?

Greg: I believe we all need to speed things up. Consumers expect as much, and small businesses are beginning to demand it. Case in point, digital wallet usage continues to increase year-over-year, and consumers cite convenience and speed as the two primary drivers behind its desirability.

Tina: Coupled with those expectations of speed, I think we’ve hit a tipping point for digital payments. COVID-19 has jumped us lightyears ahead in this area. A new FIS study asked consumers how they will change their online purchase behaviors once COVID is no longer a threat, and 31 percent said they would continue to use more online and mobile banking in the future. Another 40 percent said they are likely to shop online more than in-store in the future. Knowing that e-commerce this year is already up 209 percent, that’s a huge statement. Clearly, preferences are moving to the digital channels across the board.

Greg: And this trend will continue with growth across all generations. In fact, research found that 46 percent of Baby Boomers, 39 percent of Gen Xers, and 35 percent of Millennials all have changed the way they have interacted with their banks since the start of the pandemic. Market needs will continue to evolve, and as they do, I’m confident that ICBA Bancard will continue to help community banks make the right strategic decisions, precisely because we’re always asking why.

Tina: Exactly. We challenge the status quo to ensure the best solutions emerge to support community banks. Those insights allow us to hit the intersection where a bank’s “why” meets the needs of the customer, creating payment opportunities that will stand the test of time.  

View part one of this conversation in last month’s Tina’s Take blog. To learn more about Bancard services, visit icba.org/bancard.