For more than a decade, Citi has consolidated its retail banking business, focusing on affluent customers and businesses in major cities in the U.S. and worldwide. More recently, Citi has streamlined its footprint, redesigned branches, introduced digital product enhancements, invested in wealth management, expanded their ATM network and accelerated the introduction of new digital features.
It appears the ‘sleeping giant’ is ready to wake up and disrupt the competitive landscape, however, introducing a new mobile platform targeting the increasingly digital consumer. Rather than building costly brick-and-mortar branches, Citi will introduce a digital pure play option.
Citi will leverage the trust that consumers have toward their bank brand, developing the digital offering under its Citi brand. Other major organizations have opted to build sub-brands to support digital banking pure play products. For instance, Chase recently introduced the ‘Finn’ digital app, Wells Fargo has introduced ‘Greenhouse’, while BBVA Compass acquired ‘Simple’ to entice digital natives. Similarly, Goldman Sachs has introduced the ‘Marcus’ brand to build savings and lending portfolios.
Reinforcing the decision to build a digital-first app, Citi sponsored a survey that found 87% of consumers trust banks more than non-bank institutions when it comes to handling their finances. The survey also found that 79% prefer to use a single app to manage their finances instead of relying on several specialty mobile apps, and that 87% want a snapshot of their entire financial life in one place.
Timing is Perfect for Mobile-First Apps
The timing appears to be perfect for the introduction of a strong mobile-first solution. Not only are consumers expecting more than ever from their financial institutions, but they are comparing experiences to non-banks like Amazon, Facebook, Google and even retailers like Best Buy and specialty digital offerings.
More importantly, consumers looking to change their financial services provider are increasingly moving to the biggest bank brands because of the (valid) belief that these banks are investing more heavily in delivering improved digital experiences. This is the most stated reason why the largest U.S. banks have grown faster than their competitors and why their satisfaction scores have surpassed those of smaller organizations for the first time.
“Over the past few years, we have been transforming our U.S. Retail Bank into a growth engine in our core markets while developing new mobile banking capabilities as a platform to one day serve consumers nationwide. That day is here,” said according to Stephen Bird, CEO of Citi’s Global Consumer Bank. “Consumers will be able to seamlessly open a Citibank account without ever visiting a branch and enjoy a suite of compelling products, the largest fee-free ATM network nationwide and powerful digital capabilities across lending, payments, investments and credit cards. There may be no more powerful single app in market today.”
“Our goal is to acquire, engage and service our clients entirely digitally,” Bird said.
A Citi Digital Solution for Non-Citi Customers
Interestingly, the Citi Mobile App will offer a first-of-its kind capability … being available to everyone – even if they are not a Citi customer. Non-Citi customers will be able to build a profile, then link their other financial accounts to see a 360-degree view across all financial accounts and spending insights to enhance clients’ financial wellness. Features will include in-app account opening in addition to account aggregation, spending insights and bill management features.
The Citi Mobile App is not a total surprise to industry observers. In 2015, Citi announced the establishment of the Citi FinTech unit to create mobile-first banking experiences for its customers. They were one of the first banks in the country to make many of its application programming interfaces (APIs) available to third-party developers. A year later, Citi introduced a mobile-first banking solution for its Citigold customers.
“We are realizing our full coast-to-coast potential as a national bank,” said David Chubak, Head of Citi’s Global Retail Bank. “We’re investing in our products, our people and our capabilities to make Citi the only bank our clients will ever need. These new, game-changing mobile features will enable consumers to manage the breadth of their financial lives in the palm of their hand.”
Personal Financial Management Revisited
Personal financial management (PFM) solutions have had a somewhat jaded past. While almost everyone surveyed says they want a way to budget and see their finances in a consolidated view, the application and use of most solutions (besides Intuit Mint) has been underwhelming.
Citi’s new 360 Financial View feature will allow both customers and non customers of Citi to get an overview of their finances from all of their banking accounts in one place. The feature acts as a “hub” for app users’ finances, replacing the need for consumers to use third-party financial management apps.
According to Citi, the Spending Insights feature will gives customer the ability to track monthly spending vs. income, make progress toward weekly spending goals, unlock opportunities to save, and illuminate insights across all their spending, similar to the way apps like Moven have done. Citi is the first major US bank to offer this feature to non-clients.
Beyond account aggregation and personal financial management, the new app will support enhanced bill payment capabilities. Mobile users will be able to view all of their their bills – even those they don’t pay with a Citi card. The solution will not only pay bills, but inform the customer when a bill increases, providing customers with full visibility and control over recurring charges.
Building Fast With the Future in Mind
The new Citi Mobile app was developed using agile operating methodology, leveraging the insights from thousands of clients while partnering with outside developers. While an involved process, Citi was able to deliver the new capabilities within seven months. This included multiple rounds of research and testing. The beauty of this type of development is that additional features can be launched quickly and efficiently.
“Co-creating new solutions with our customers started by asking about their financial needs today and listening to how we could help achieve their financial goals tomorrow,” said Yolande Piazza, Head of Citi FinTech. “Learning from our customers enabled us to design solutions that delivered speed, convenience, visibility and control as well as more meaningful insights to help them shape their financial futures”
Extending this new mobile app to non-Citi clients could be provide an opportunity to cross-sell products and services to these non-clients and onboard them as new customers – especially since prospects can open their accounts directly in the app they use to monitor their accounts.
As mentioned, 79% percent of consumers in Citi’s survey preferred to use a single app to manage all of their finances. By meeting that consumer preference, Citi could onboard new customers while staying in front of these consumers from a brand perspective easier than if they didn’t have any relationship with Citi.