Westpac's disappointing app exposure

“The Future is Now” declared Westpac this week in a funky post-modernist room at Sydney's Museum of Contemporary Art where the bank launched their new iPad app, designed to take advantage of the tablet form factor.

As in other industries, the mobile internet is changing the way bank customers behave, Westpac's mobile service to reached a million users in 30 months compared to the eighty it took to reach a million clients on their web platform.

“Life and technology are now highly integrated, and it's fundamental to our business to be receptive and proactive for the current and next generations,” said Jason Yetton, Group Executive of Westpac's Retail & Business Banking division at the app's launch.

The app is clearly laid out and provides a summary snapshot of the customer's accounts, each account appears in its own box and transferring money between accounts is a matter of dragging one box onto another.

While the app is designed for personal banking there are some basic business functions as well. Unfortunately it doesn't appear to integrate closely with the business functions of Westpac's merchant PayWay service beyond letting you link accounts.

This lack of integration also spills over into working with other parts of Westpac's Australian Financial Services Group, If you're banking with St George, the Bank of Melbourne or BankSA this app won't work for you.

Android users will also be waiting for an app as Westpac's general manager of online and mobile Harry Wendt wouldn't commit to a when an app for the Google platform would be released.

The bank is proud of its digital heritage, “Westpac was first to launch computerised cheque processing, first of the big four to introduce ATM's, first with Eftpos, first to offer online statements, and first to offer super in online and mobile banking,” Yetton proclaimed.

Being proud of what the bank did prior to its focus on cutting IT costs – with the last round of  119 IT job cuts being flagged in May – is one thing, however the lack of integration and basic features show the bank is now struggling to keep up with a rapidly changing marketplace.

As consumer behaviour increasingly moves online, a strong technology base is essential for all the banks, as NAB's Lisa Gray yesterday said at a Trans-Tasman business lunch, “mobile devices are the single biggest factor driving change and innovation in the digital economy.”

Westpac agree with this view as they are seeing the role of retail banking changing.

“Banking on the move represents a very material change to the way customers and banks will do business in the future.” says Yetton.

In his position at Westpac's Retail and Business banking division, Jason doesn't see branches closing but admits floor areas will shrink as transactions increasingly are carried out on mobile phones and tablet computers.

“Quite a lot of cash and cheques still pass through our branches, although over last five years volumes have been declining at 5 per cent per annum,” says Yetton.

“Branches are more about interaction rather than transactions. When people make the big decisions in their lives – buying your first home, setting up a business or planning for retirement – they are things where most people want to get some advice and expertise.”

“For bankers in the branches, we've been up skilling them so we have more local business specialists, more financial planners and more home finance experts.”

They may still need those branches for transactions though, as the demonstration was interrupted when the app froze on logon.

Despite technical hiccups, the Westpac iPad app, the NAB's drive to mobile and  last week's launch of the CBA banking software platforms show how the banking industry is adapting to change. Whether it's enough for some of them remains to be seen.