CBR spoke to Barclay’s Richard Martin, managing director, payments and cash management products, and Mike Walters, head of UK corporate payments product management about the future of its smartphone app, Pingit.
Barclay’s Richard Martin (L) & Mike Walters (R)
Barclay’s Pingit smartphone money transfer app launched in February 2012 and has proven to be something of a hit for the company, already picking up 700,000 UK customers.
However the UK still lags behind international rivals when it comes to smartphone based banking. Australia’s Westpac bank is reporting that it has 1 million business and retail customers using its banking app, and Bank of America claims to have just passed the 10 million mark.
Barclay’s updated Pingit a fortnight ago to add more corporate functionality, such as allowing customers to pay corporates directly through a combination of Corporate IDs and/or QR codes.
This means customers will be able to pay their bills or invoices instantly by simply entering the company name and bill number, or, even easier, by scanning QR codes.
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Corporate transactions will also have a limit of £10,000 per transaction, instead of the £300 limit per transaction for retail consumers – ideal for businesses small and large.
Walters told CBR the response from corporates and industry has been ‘overwhelmingly positive’, but declined to offer any specific figures on uptake so far.
"We’re two weeks in, but we’re very happy with where we’ve got to so far. We need to let it run for another couple of months before we’ll be ready to share those figures," he said.
While successful in its singular purpose, the app remains somewhat primitive compared to overseas offerings, which are increasingly offering a more complete banking experience on their mobiles.
Martin said that Barclay’s is already in the process of extending the capabilities of its app, with an eye to adding further functionality when it’s ready.
"There will be future development work on this. The next stage we’re looking at is corporates being able to make disbursement payments, as opposed to just receiving them. So it will eventually be a two way system. It’s a big program that is going to be evolving and there will be a lot more functionality coming through over the coming months," said Martin.
For example, this could mean that corporates could provide disbursement options such as paying out virtual dividend cheques.
So why hasn’t Barclay’s followed the model of its rivals, such as Lloyds and RBS, in cutting to the chase and developing a full blown smartphone/tablet banking app?
"We’re not precluding future development in apps for mobile banking, such as consumers’ ability to access accounts and savings and credit cards. At the moment [Pingit] is solving a very specific set of challenges," said Walters.
Is it a regulatory or security issue?
"Actually it’s more about ease of use. I think that if the guys in Apple and Google have taught us anything, it’s that consumers will use things if they are very simple and accessible to use," said Walters.
"Not to sound patronising, but consumers tend to flock to things they have a natural affinity with and have the ability to use. The reason [Pingit] is gaining support in the consumer base is that its intuitive – it isn’t excessively crowded with added features, such as the app asking ‘do you want to stop your standing order’. We have focused on a utilising a very specific, easy to use interface."
Interestingly, Barclays Spain does have a fully functioning banking app; so presumably Barclays UK could have access to that IP.
"Let’s not forget [Pingit] does have some banking functionality in there – you can get your balance, and get your transaction history. So it’s not the full blown banking app, but it is a decent link into the core requirements that you need as an individual account holder," said Martin.
However, the set up process for the app remains exhaustive, although still not as bad as the problems CBR had with O2’s mobile wallet (see story here). It will require new passwords, extensive data entry and ‘penny payments’ to your bank account with verification codes.
But whereas the original consumer version of the app didn’t require users to be Barclay’s customers, corporates will need to have a Barclay’s account on the books to have full functionality.
The app was developed as a combined third and first party effort. As the two mostly handle the business end of the enterprise, they found adapting the original consumer only peer-to-peer version of Pingit and adapting it to the corporate market a relatively easy task.
"There was a strong demand for a new payment mechanism. So then we took it through to our corporate clients and got a very strong, positive backing," said Walters.
The key to its success has been keeping the system secure.
"We haven’t had any pushback from corporates on the security side. Because of the way Pingit works, we’re not asking them to download an app into their environment, we’re not asking them to change their links to the bank or adjust their accounts. We’re not asking them to change any part of their existing financial processes – It’s all kept within the application, within our secure environment," Walters said.
