Switch Ninja CONCEPT DOCUMENT

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CONCEPT DOCUMENT

Switch Ninja

TEAM MEMBERS

Doug Ebner, First West Credit Union Danielle Brehmer, Lake Trust Credit Union Matt Vance, Salal Credit Union

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PROBLEM DEFINITION

Consumers feel trapped at their banks. A 2012 Consumer Reports National Research Center survey found that one in five consumers wanted to change banks largely because of their frustrations with increased fees for routine services but the challenge of transferring automatic payments and other factors kept half of them from making the switch.1

“Unfair bank practices and rising fees are prompting more and more consumers to consider voting with their feet and taking their money to another bank or credit union,” said Suzanne Martindale, staff attorney for Consumers Union, the policy and advocacy arm of Consumer Reports. “But many

consumers don’t follow through because moving your money takes a lot of time and money and some bank policies make it harder than it should be. We need to make it easier for consumers to switch banks so they have a real choice when it comes to where to keep their money.”

To answer this call from consumers, the market has responded. Credit unions and banks have spent considerable resources trying to make switching easier. In most cases, these switch kits are a

practical set of pdfs. And, while well intended, this paper shuffling does little to address the frustration, confusion and concern of consumers.

And, with recent advancements in the areas of mobile and photo capture technology, the environment for and openness to a more intuitive and efficient switching system is within the grasp of consumers. They’re all but demanding it. In fact, Consumers Union is suggesting policy changes that include holding financial institutions responsible for transferring consumers’ automatic payments and deposits from an old account to a new account within 14 days, going as far as to suggest portable bank

account numbers that make switching easier,2 like what’s occurred in Great Britain.

Team Oznot used the Kano methodology to identify attractive and expected attributes of switching solutions. Posing functional and dysfunctional questions, the November 2013 survey asked Lake Trust members who joined the organization in the last six months their opinions and identified several moments of truth within the tested attributes. Amongst those testing the most attractive were:

• the automated transfer of direct deposit and bill payments

• an alert when the first direct deposit had been received

• suggest opportunities to reduce debt and save money

• $500 line of credit to cover unexpected expenses or payment timing issues

• photo capture of bills

The market share opportunity for credit unions is incredible. Fifteen million Americans want to switch from their bank but are hesitant due the switching of their automatic payments and direct deposit concerns. Moving those consumers to credit unions would create a 21% increase in national credit union membership, or a $627 billion increase in national credit union deposits.

Enter Switch Ninja.

1_{Consumer Reports National Research Center; “Trapped at the Bank: Removing Obstacles to}

Consumer Choice in Banking.

http://www.consumerreports.org/cro/news/2012/05/obstacles-to-switching-banks-stifle-consumer-choice/index.htm; 2012

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INNOVATIVE SOLUTION

Switch Ninja is designed to remove the complexity of switching to a new financial institution by automating the transfer of bill payments and deposits for common payees and communicating with consumers throughout the process, easing their minds and decreasing the time to complete the overall switching process. This improved experience for consumers transforms a time-consuming manual process to a streamlined, sticky solution and market differentiator.

To initiate the transition, Switch Ninja marries the information the new credit union has collected at account opening with the captured payment related information, and eases the members mind by keeping them abreast of what’s happening with the switch.

THE 3 CORE FEATURES OF SWITCH NINJA: ORGANIZES

To initiate the transition, Switch Ninja collects and organizes the account information needed to make the transfer.

AUTOMATES

Using the member’s information that’s entered at new account opening, Switch Ninja auto-populates the needed fields within the necessary transfer forms and returns the forms the most efficient way possible, depending on the payee or depositor.

NOTIFIES

Once the form is sent on to the payee or depositor, Switch Ninja keeps members up-to-date each step of the way with notifications at critical points in the process, like when the first direct deposit arrives and when a transferred bill has been deducted.

PROTOTYPE

Switch Ninja is the first iteration of our automated switching solution, built on the most attractive features identified in our research. A web-based application that allows members to easily and securely transfer bank account and pre-authorized payments to their newly established credit union account, Switch Ninja works to automate, organize and notify the member of items entered into the switch application, creating a transparent and seamless experience. Switch Ninja battles

inconvenience and anxiety, simplifying a once-difficult process and allowing a member to easily move their business and deepen their financial relationship.

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TEST

In our research of the switching process, Team Oznot identified the following key challenges and corresponding solutions to fully automating the process:

• Some payees require a member signature

o Switch Ninja incorporates that simple step into the process by electronically capturing the signature.

• Online Banking extracts are inconsistent amongst financial institutions

o Required pre-authorized transaction to be manually entered

• Members don’t always have all the information they need to setup the pre-authorized transaction for the switch.

o Switch Ninja allows members to access the program at home or in a branch Based on these key solutions and addressing the members’ moments of truth noted earlier, Switch Ninja connects with the member where they are. Built using responsive design, Switch Ninja will adapt to your screen, whatever device you’re using, smartphone, tablet or computer. And to move the iteration through to prototype quickly, frameworks (YII and Bootstrap) were used to develop Switch Ninja.

Switch Ninja was tested at Valley First, a division of First West Credit Union by 10 members. Over the course of five weeks, credit union members used Switch Ninja to move automated payments to Valley First.

Here’s how Switch Ninja works:

1. Member/Customer able to visually track the switch progress anytime/anywhere via a secure public online website

2. Full-service and Self-service options (Member able to utilize service however they prefer) a. Self-serve - Member/Customer able to add preauthorized transaction information

from home

b. Full-Serve – Branch staff able to enter all preauthorized transaction information for Member/Customer

c. CSV upload

3. Integration with Data Warehouse to minimize the amount of data entry a. Pulls member name, address, phone and account mapping info

b. Checks daily to see if preauthorized payment has been processed through account 4. Pre-populated switch forms that can be printed, faxed, or emailed

a. Default switch form used UNLESS a vendor specific form is uploaded

5. Integrated internet fax service - Fax switch form to Vendors directly from within application. 6. Integrated email – send out email notifications to member/customer and branch staff

a. Welcome email to Member/Customer with password

b. Switch notice to member/customer and branch staff when preauthorized transaction has successfully gone through their account

c. Vendor email with pre-populated switch form

7. Signature capture (currently through taking a picture of signature through a webcam) a. Flattens image and attempts to apply a clear background

b. Ability to capture both primary and joint signatures

8. Member/Customer able to select which account each preauthorized payment should use 9. Vendor Configuration

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b. Ability to configure who must complete that task (i.e.: the member or the branch teammate handling the switching process)

c. Ability to specify which additional (special) information each vendor requires i. Vendor Account Number

ii. Service Account (if different from address on file)

iii. Special cross reference number (License plate number versus account number)

10. Branch staff able to view switch status of any of their members

Additionally, as part of the industry’s best practices and already in implementation at Valley First Credit Union, members were offered access to additional funds to reduce the emotional impact and anxiety of switching and help cover expenses as their deposits made their way to their account.

RESULTS, COMMENTS, AND NEXT STEPS

RESULTS:

Switch Ninja was tested with 10 Valley First Credit Union members during the month of March, with automatic payments being transferred from other financial institutions. During the process, both members and teammates shared that the switching experience was less painful than anticipated or improved based on their past experiences. The process worked as designed and the intention to eliminate or reduce switching pain points, for both members and staff, was realized.

COMMENTS:

The following quotes are direct member feedback:

Valley First Staff Member, “It looks great. This is such a great feature to offer when we transfer over accounts. We often have members that are so hesitant to do the full switch to us as they feel it is too exhausting and time consuming to transfer all their debits/credits. I look forward to using it with more members. This is something that is long overdue! So far, so good.”

Valley First Member, “I recently moved over to Valley First from another Financial Institution. It would have been quicker and easier to have a website like this to help in the transition.”

Valley First Staff Member & Member, “As the development of this program progressed, I just kept getting more excited about the possibilities we were identifying and improvements we were able to make. Our branch staff that have been involved in our pilot are excited about this new application for both how it will simplify their process and add visibility to our members throughout the entire process.” Valley First Staff Member, “Great start . . . already this will significantly improve the member

experience by simplifying the hassle of changing their pre-authorized payments. The reduction [or elimination] of the switch pain is the last hurdle for us in attracting new members to our great accounts and competitive products.”

NEXT STEPS:

Switch Ninja was built using an agile development approach, making it easier to produce future iterations. We see the next steps as incorporating the following features:

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1. Electronic signature pad support

2. Banking System Integration (Current integration done through Data Warehouse) 3. Reporting (Monthly status report and other custom reports)

4. Customizable theme selection (customize basic website theme)

5. Automate collection of preauthorized transaction info by integrating with PFM vendors or other sources

6. Print Void Check Image – Self serve option for member to print a void check image for any of their accounts without having to visit a branch or ruin an actual check

7. Switch related common tasks checklist – Add the ability for the member to create a customized checklist of common tasks that are necessary when switching financial institutions

a. Online Banking Bill Payment vendor info b. List of current e-Transfer recipients

c. List of accounts/investments/loans to move

8. Mobile image capture using cell phone technology to collect biller information and reduce member input steps

9. Ability to switch direct deposit

10. Social sharing of members’ experience

APPENDIX

Innovation Process & Prototype Development

Before we built the prototype, we engaged a group of LEAN GreenBelts to perform a Value Innovation Kaizen around the switching process. This Kaizan (Good Change) was intended to identify the current state and create a future state which delights members.

The core team consisted of seven individuals, including two credit union employees. Several subject matter experts were brought to support the process. As they investigated, the current state was found to be fraught with challenges, inconsistencies and errors.

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The team investigated the credit union process, interviewed members who recently went through this process and went through it themselves:

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Based on their findings they created a future state and then an ideal state:

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The ideal state would be broken down into three steps:

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As part of the value innovation process the Kano graph is used to identify what could wow the member within this process:

Based on these factors helped us structure the first prototype which was made up of Credit union employees, members and vendors.

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Following the completion of the Kaizan, we also wanted to test some additional attributes that we identified and understand how they were perceived by new members. The following survey result reflects those opinions. We also used these results to prioritize our work on the prototype.

All Electronic Online Switch Service With Checking

1. When moving to a new financial institution and transferring all your automatic bill payments and deposits, how would you feel if they offered to take care of that for you for $25.00?

Answer

Options I'd Dislike It I Can Live Without It I'm Neutral I'd Like It I Expect It Average Rating Response Count

12 7 8 7 1 2.37 35

answered question 35

skipped question 4

2. After a bad experience with your old bank, how would you feel if your new financial institution made it easy to tell others about your experience on Facebook, Twitter, or some other social media channel?

Answer

Options I'd Dislike It

I Can Live

Without It I'm Neutral I'd Like It I Expect It

Rating Average Response Count 7 9 12 5 0 2.45 33 answered question 33 skipped question 6

3. What if you didn’t have a way of covering expenses as you tried to convert deposits and withdrawals to your new credit union? How would that make you feel?

Answer

18 2 10 0 1 1.84 31

skipped question 8

4. When switching to a new financial institution, how would you feel if you didn’t receive an alert when your first direct deposit had been received?

Answer

I Can Live

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5. When moving your accounts to a new financial institution, how would you feel if there was an automated process for transferring:

Answer

I Can Live

Rating Average Response Count Bill Payments 1 2 6 19 6 3.79 34 Direct Deposit 1 0 3 22 7 4.03 33 answered question 34 skipped question 5

6. How would you feel if your new credit union told you ways to reduce your overall debt or monthly debt payments? Answer

I Can Live

7. How would you feel if you couldn’t use your cell phone to capture bill payment information with a picture and instead had to manually enter it into the credit union’s online system?

Answer

13 6 12 2 2 2.26 35

skipped question 4

8. When moving to a new financial institution, how would you feel if you couldn’t share this news with others? Answer

I Can Live

9. When switching financial institutions, how would you feel if the credit union provided you with a $500 line of credit to help cover expenses as your deposits and withdrawals transferred over?

Answer

0 4 7 22 2 3.63 35

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10. When moving to a new financial institution, how would you feel if your new financial institution did not offer to transfer all your automatic bill payments and deposits for you?

Answer

I Can Live

11. How would you feel if you received an alert notifying you that your first direct deposit had been received after switching to a new financial institution?

Answer

I Can Live

12. When switching to a new financial institution, how would you feel if the credit union didn’t help you lighten your debt load by offering you ways to reduce your payments?

Answer

I Can Live

13. When setting up bill payments at a new financial institution, how would you feel if you could use your cell phone to capture bill payment information with a picture?

Answer

I Can Live

14. When opening your accounts at a new financial institution, how would you feel if you couldn't automatically transfer your:

Answer

I Can Live

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All Electronic Online Switch Service Without Checking

1. When moving to a new financial institution and transferring all your automatic bill payments and deposits, how would you feel if they offered to take care of that for you for $25.00?

Answer

I Can Live

2. After a bad experience with your old bank, how would you feel if your new financial institution made it easy to tell others about your experience on Facebook, Twitter, or some other social media channel?

Answer

9 13 24 12 0 2.67 58

skipped question 5

3. What if you didn’t have a way of covering expenses as you tried to convert deposits and withdrawals to your new credit union? How would that make you feel?

Answer

I Can Live

4. When switching to a new financial institution, how would you feel if you didn’t receive an alert when your first direct deposit had been received?

Answer

32 11 12 1 1 1.74 57

skipped question 6

5. When moving your accounts to a new financial institution, how would you feel if there was an automated process for transferring:

Answer

I Can Live

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6. How would you feel if your new credit union told you ways to reduce your overall debt or monthly debt payments? Answer

I Can Live

7. How would you feel if you couldn’t use your cell phone to capture bill payment information with a picture and instead had to manually enter it into the credit union’s online system?

Answer

15 13 23 4 0 2.29 55

skipped question 8

8. When moving to a new financial institution, how would you feel if you couldn’t share this news with others? Answer

14 6 32 3 1 2.48 56

skipped question 7

9. When switching financial institutions, how would you feel if the credit union provided you with a $500 line of credit to help cover expenses as your deposits and withdrawals transferred over?

Answer

0 4 10 38 4 3.75 56

skipped question 7

10. When moving to a new financial institution, how would you feel if your new financial institution did not offer to transfer all your automatic bill payments and deposits for you?

Answer

29 9 13 2 2 1.89 55

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11. How would you feel if you received an alert notifying you that your first direct deposit had been received after switching to a new financial institution?

Answer

I Can Live

12. When switching to a new financial institution, how would you feel if the credit union didn’t help you lighten your debt load by offering you ways to reduce your payments?

Answer

I Can Live

13. When setting up bill payments at a new financial institution, how would you feel if you could use your cell phone to capture bill payment information with a picture?

Answer

I Can Live

14. When opening your accounts at a new financial institution, how would you feel if you couldn't automatically transfer your:

Answer

I Can Live

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