Imagine the future of banking through open innovation…
It was in 2009 when PayPal launched the PayPal X platform. This platform provides a software development kit (SDK) with technical documents and API (application programming interface) tools to allow third-party developers to create apps that are based on the PayPal infrastructure. The benefits are great: by opening up to the whole community, potentially a large number of innovations can be created using the PayPal infrastructure but without PayPal having to incur the large costs of development. Indeed, since its launch a large number of new apps have been created such as Twippr, Lottay, Juice.to and many more.
Not too long after, MasterCard and Visa followed. And then..? And then nothing happened... Until it was recently unveiled that Crédit Agricole is working on its own application marketplace, called the CAStore. The Crédit Agricole marketplace provides third-party developers with an SDK and a set of APIs through which bank account data can be retrieved. This allows developers to create their own mobile and web applications for Crédit Agricole customers. In addition, the CAStore provides marketing support for developers, a co-create space where clients can share their ideas directly with developers, and a forum where developers can request Crédit Agricole to improve current or develop new APIs. A pilot phase will start before the summer.
I was lucky to be offered a first look inside the SDK that showed me its current functionality. The APIs provide read-only functions (on dummy accounts for testing purposes). Account data can be retrieved on the following items:
- List of bank accounts, credit cards and loans for the online bank account
- Account balance, transaction overview (45 day history) and bank statements
- Location of bank branches and lists of branch offices by city
- Contact information for customer service
The current read-only functionality allows for a better presentation of bank account information. It can be used to create a much improved user experience and provide access to information inside the bank account that currently remains invisible and unused. Therefore I see many opportunities, one could create for example:
- Financial Overview: most valuable source of income (based on amount, stability, risk etc.), largest expenses, categorization of expenses
- Financial Timeline: graphs of account balance, MoM & YoY comparisons of income and expenses, goals versus actuals
- Mapping Financial Relations: who pays you, who do you pay, graphing of your payment network, integration with social networks
- Geographical Footprint: where do you spend your money, integration with Google Maps or other location bases services
- Added Value Services: loyalty, couponing and targeted marketing based on the account information
These are just a few examples off the top of my head. And I am sure the ‘community’ will think of numerous other areas I could have not imagined before.
In general, for multiple legitimate reasons banks struggle to create innovations and adapt to changing consumer needs. Open innovation may be a great solution. At the end of 2011 I made the 'outrageous' prediction for 2012 that banks would open up the access to the bank account, allowing for open innovation. All the credit to Crédit Agricole that they now dare to tap into the opportunities of open innovation. I have the good hope other major banks will follow later this year.
Open innovation offers great opportunities. Just imagine…