remote deposit and service changes everything
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Remote Deposit, Remote
Service
It Changes Everything
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Remote Deposit, Remote Service
• Remote Deposit is “un-tethering” customers who have no
other reason to visit the branch
• This large segment of “virtually domiciled” customers,
including both consumers and small businesses, requires
a complete rethinking of the sales and service model
• Banks can take concrete steps to implement a service
model that costs less and is more satisfying for un-
tethered customers
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Customers are making fewer
transactions at branches
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Deposit
Withdrawal
Check Cashing (On Us)
Check Cashing (Off Us)
Total
-7% to -9%
-3% to -6%
-12% to -16%
-17% to -19%
-4% to -5%
Branch Transaction 1-year CAGR
Proprietary and Confidential to Novantas, LLC
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Proprietary and Confidential to Novantas
Preferences are also changing for sales channels
Open a New Relationship
Open a New Account
-8%
-21%
-23%
Purchase Investment/Insurance
Procuct
-15%
Get Financial Advice
Sales Transactions by Branch Preference (YoY Growth)
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• Utilize the branch as their primary channel for the majority of their service and sales interactions
• Value relationship with staff at the branch
• Slightly skewed towards lower income households
Branch Traditionalists
(25-40%)
• Heavy users of all channels (branch and remote)
• Generally hold larger deposit and loan balances
• Great target for branch transaction migration given they already use remote channels today
Ultra-Connected (30-45%)
• Nearly all transactions are conducted virtually, though online, call center and mobile
• Up to 66% cheaper cost to serve
• Similar demographically to other segments, but shows opportunity for cross-sell
Virtually Domiciled
(25-35%)
5 Proprietary and Confidential to Novantas. LLC
There are three distinctive banking
segments among US consumers
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Most small businesses prefer a
virtual sales process
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Contact Preference When Considering a Product Solution
Source: Novantas 2012 Treasury Management Buying Behaviors Survey conducted with Greenwich Associates 6
Email or
Phone 39%
Email 13%
In-person
31%
Phone or in-
person 4%
Phone 13%
Email or
Phone 38%
Email 17%
In-person
31%
Phone or in-
person 4%
Phone 10%
Companies under $10mm Companies $10mm-$20mm
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These behaviors lead to significant
differences in cost-to-serve
7 Proprietary and Confidential to Novantas
Cost to Serve by Consumer Segment Values are indexed to average cost to serve
based on benchmark analytics
43
157
88
Ultra-Connected Branch Traditionalist Virtually Domiciled
Avg = Index 100
$0
$100
$200
$300
$400
$500
$600
Field Sales Inside Telesales(inbound referral)
Inside Telesales(outbound cross-
sales)
Cost per Small Business Sale
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Most customers continue to prefer
branches for deposits
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Branch Preference by Transaction
54% 58%
70%
Deposit Funds
2006 2012 2011
25% 26%
41%
Withdraw Funds
15% 19%
45%
Transfer Funds
35% 37%
53%
Resolve an Issue
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Image-enabled ATM’s lead to less branch attachment
Proprietary and Confidential to Novantas, LLC
Banks with Image-Enabled ATMs Banks without Image-Enabled ATMs
36%
41%
18% 21%
ATM Channel Preference for Depositing Funds
2012 2011
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RDC promises to further “un-tether”
customers from branches
10 Proprietary and Confidential to Novantas
12%
43%
45%
Currently Using RDC Not Using RDC, Willing to Consider Not Using RDC, Not Willing to Consider
Consumer Willingness to Use Remote Deposit Capture (RDC)
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Banks have widely different levels of
success with RDC
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0%
5%
10%
15%
20%
25%
30%
Top Performers Average Lagging
Remote Deposit Usage Business Banking
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What are top performers doing to
increase use of RDC?
• Make RDC part of your small business online banking
platform
– No need for a separate online portal
– Fully online application and implementation process
– This makes it easier to sell and easier to use
• Make it easy to get a scanner, or use the scanner you
already have
• Make the pricing simple and predictable
• Give branch bankers an incentive to sell RDC
• Teach branch bankers how to sell RDC
• Have specialist on call to support RDC sales
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