Kristin R. MoyerStessa Cohen here. There’s an infamous episode of Sex and the City in which one of the main characters, Miranda, talks about a recent date. At the end of the evening, the man in question says to her, “I’ll call you.” The four friends, Carrie, Samantha, Miranda and Charlotte discuss the merits of this “I’ll call you” and analyze all the possible reasons he didn’t prolong the date or call her. Berger, Carrie’s beau who is also sitting at the table, gives his blunt “guy” interpretation, “He’s just not that into you” — which turns out to be true. Miranda listens and uses Berger’s insight to move from preoccupation witha guy who didn’t want to date her to her next date.
In a recent article “A New Goal: Checks without Paper” (behind a paywall) The American Banker analyzed all the ways that banks can leverage their existing legacy check processing infrastructure to create “electronic checks.” Sex & the City may be off the air, but the banks are the new drama queens creating this hot air around these “new” checks: “Native electronic transactions” “electronic payment orders (EPO)” “Digitally Originated Checks,” or DOCs.
But you know what? Consumers feel about paper checks the same way Miranda’s date felt about her: They are just not into checks. And they don’t plan to be anytime soon. They aren’t looking for new ways to write checks. They want more personalization and they want to be able to manage their money (behind paywalls too).
How do we know this? SmartyPig’s goal-based savings account growth ($400 million in deposits in a couple of years), the continuing decline of paper checks and growth of electronic payment methods (According to the US Federal Reserve 2007 Payment Study (which covers payments made 2003 – 2006, so it’s already out of date) paper check usage declined by 6.4% while debit card usage increased 17%), the swell of hype around person-to-person (P2P) mobile payments.
Obviously checks and check processing are an investment that banks care about. But should they be focused on how to drive customer interest in a payment methods they aren’t interested in? I’m working on research now about why they should avoid re-treading old technology, old methods, to extend the value of checks — and why banks should focus on what their customers are doing, how they are doing it and how developing trust in mobile-based banking services may be key.
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