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ACH Transaction Volume Growth Indicates Rapid Shift to Digital Money Movement

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ACH Volume Soars At Record Pace

Wow!! Have you seen the new information that the National Automated Clearing House Association (NACHA) has posted about ACH transaction volume during the second quarter of 2021?  Volume soared at a record pace.

According to the post, the quarterly volume of 7.3 billion was an increase of 9.9% from the same period in 2020. The value of those payments was $18.4 trillion, reflecting a nearly 25% increase from a year earlier. Additionally, during the first quarter, a “new record was set in February when ACH volume averaged more than 118 million payments per day, the ACH Network’s highest daily average for a month. The second was in March, when ACH volume hit 2.7 billion payments, the largest monthly volume in ACH Network history. This included approximately 110 million economic impact payments by Direct Deposit from the federal government.”

 

In March, ACH volume hit 2.7 billion payments, the largest monthly volume in ACH Network history.

 

Clearly, these numbers show that the COVID pandemic has accelerated a change in behavior.

amongst consumers and businesses to adopt electronic payments and digital money movement.  Drilling down further into the Q2 numbers, we see that P2P transactions increased by 24.2% from the year-ago quarter, B2B activity increased by 28.7% and internet transactions increased by 14.3%. 

These volume numbers indicate that the rapid growth of transactions within the ACH network has not only continued to grow but are now growing at a record pace.

Question:

Why are ACH transaction volumes increasing so quickly and how will financial institutions adapt to this change in behavior from a customer intelligence perspective?

Answers: 

More and more consumers are choosing to conduct their lives online and in the mobile space. This includes entertainment, travel, paying bills, sending money to family, friends or businesses, shopping, buying digital currency, being paid by Direct Deposit, and investing. Businesses are also moving away from paper checks and adopting digital payments. From a financial institution perspective, firms will be challenged as their customers will be expecting that when moments that matter occur, their financial institution will be there for them, in near real-time with the right guidance and the financial products and services that meet their needs.

Customer Expectations Are Changing To Near Real-Time

Customers will be expecting that when moments that matter occur, their financial institution will be there for them with the proper guidance, financial products, and financial services that meet their needs.

Insight Financial Marketing has an industry-leading solution that will enable your financial institution to better understand consumer and business behavior in near real-time.  We have a proprietary analytical approach that identifies pattern changes, life events, and lifestyle changes that will help your FI to deepen relationships with your consumer and business customers. To find out how IFM can help your team better engage with your customers, visit us at our website, Infimark.com, or contact Rob Reale at [email protected].  

 

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The Financial Services Industry of the Future

The past year has brought many changes to the Financial Services Industry and so far in 2021 the indications are there is more to come. Mergers and acquisitions within the top 50 largest banks in the U.S. are reshaping the landscape, changes at the periphery of the industry are also having an impact.  Several of these developments include Lending Club’s acquisition of Radius Bank, Square receiving an industrial bank charter, the growth of SoFI and Cryptocurrency (One Bitcoin > $50,000), as well as usage increases of retail merchant apps (i.e. Starbucks and Chick-Fil-a), and digital signature technology.  Additionally, the payments environment is also shifting as ACH transaction volume surges and P2P transaction volume continues to increase with more usage of PayPal, Venmo, Square’s Cash App, Apple Pay, Apple Cash and the Apple Card, and Zelle (btw… JPMorgan has ended its ChasePay service).

How will your Financial Institution adapt to these changes?

 

These changes indicate that your FI’s customers are being enticed to move an ever-increasing portion of their financial relationships away from your institution.  What steps can you take to mitigate the depletion of deposits, loans, credit, and payments?  One critical step will be to identify when to communicate with your customers and with what message.  Using advanced data analytics that can shed light on customer behavior changes and provide customer insights are critically important.  Being able to predict future needs, and delivering timely offers that provide solutions, will give your institution an early ability to retain and grow relationships with your consumer and business customers.

Technology is available today to protect your tomorrow.

 

IFM’s industry-leading solution can help alleviate your institution from flying blind when it comes to understanding current and future trends and identifying opportunities to deepen engagement with your customers.  When FinTech firms like Venmo and Robinhood were launched, early transaction volumes and dollar amounts were low. However, what was significant was the tremendous rate of growth.  In today’s environment, it doesn’t take long for new technology to go viral and impact behavior.   When your customers experience life-changing and lifestyle events your ability to be there, in a timely manner to support your customers as they navigate through these experiences, is increasingly important. Now is the time to implement IFM’s solution to protect your institution from competitive forces in your ever-changing industry.   Contact us today to learn how your FI can leverage our free evaluation and industry-leading customer insights.

 

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The Rise of Digital Solutions in the Banking Industry

The Rise of Digital Solutions in the Banking Industry: Is Your Bank Positioned Well in Our New World?

In a world dominated by the global pandemic, consumers and businesses have turned to contactless solutions and have minimized the need to conduct business in person, even as we slowly return to “normal”. These solutions have given rise to a swift increase in digital transactions as technology has enabled many financial activities to be conducted on a laptop, tablet, or mobile phone app.

The increase in digital transactions includes bill payments, P2P transactions, money movement, investment transactions, and even gambling and sending money overseas.

Another aspect of the global pandemic has been the need for financial institutions to “be there” for their business and consumer customers.  As banks and credit unions position their products and services to “be there” for their customers, this has given rise to a need for a deeper understanding of their customers’ lives and financial situation in order to provide the best possible service while at the same time maintaining profitability.

How will your Bank or Credit Union compete successfully in this New World?

One asset that is unique to your financial institution is your bank’s data, specifically the unique transactions that your customers conduct.  While the general activities and behaviors of your customers may be like other bank and credit union customers, the quality and quantity of their digital behavior becomes more unique.  Understanding what makes your customers unique is an opportunity for your institution to offer a personalized mix of financial solutions tailored to meet their needs.  This will lead to deeper engagement with your customers and your ability to maintain profitability. 

Insight Financial Marketing provides an industry-leading solution to help your bank or credit union deepen relationships with your customers even while the world is quickly changing around us.  Our innovative technology provides near real-time customer intelligence so that you can “be there” for your consumer and business customers.   

To find out more information about IFM’s solution or to get details on the free no-obligation trial of our service, please reach out to me via our website at Infimark.com.

 

 

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How Personalized Marketing is Disrupting the Banking Industry

As Digital Banking takes off, Personalized Marketing will become more important for the Banking Industry

A recent Bain & Company article mentions that financial institutions should be concerned that “many consumers look outside their primary bank for high-margin products”.   However, the article also contains recent survey results that note “most customers who received direct offers would be willing to buy more from their primary bank if it made a personalized offer”.

The article discusses how the rise of digital banking, in part caused by the global pandemic, has led to the hidden defection of bank customers.   As more consumers turn to digital banking it will be imperative for banks to personalize their messaging to customers to compete more effectively in today’s challenging environment.

What is Personalized Marketing?

The term personalization means reaching consumers with messages, pricing, and offers tailored specifically for them. This form of one-to-one marketing uses sophisticated analytic tools to analyze customer data to determine customer needs.

Banks are moving rapidly to leverage personalized messaging by using machine learning and data science tools to process a vast amount of customer data. Insight Financial Marketing is a leading innovator in this segment of the industry. IFM’s service enables banks to analyze the patterns in their transaction data to anticipate specific customer needs. A customer is more likely to purchase a bank product or service if the right offer is presented to them at the right time. This creates a win-win situation where the customer gets the service or product they need, and the bank generates revenue.

The Future of Bank Marketing

By leveraging IFM’s technology, financial service firms will be able to utilize customer intelligence to structure their products, services, and pricing based on customer needs.

For instance, combining artificial intelligence and machine learning with customer insights via IFM’s service has the potential to be a real game-changer. By leveraging IFM’s technology, financial institutions have greater precision in assessing risks, predicting life events, and lifestyle changes.

Personalization has made it possible for customers to save money by presenting the right products and services that meet their current and future needs, while also allowing financial institutions to prosper by developing deeper relationships with their customers. The future of marketing in the financial services industry is being shaped by a rapid shift to the personalization of communications brought on by modern data analysis tools provided by IFM.

Conclusion

With IFM’s industry-leading customer intelligence solution, financial institutions will have the technology and experience to leverage personalized marketing that will drive revenue growth and enable your firm to compete more effectively in today’s challenging environment. To discover how your firm can engage IFM’s solution please contact me via our website, Infimark.com, or via my LinkedIn page.

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Data Driven Intelligence Will Enable Banks to Compete More Effectively

Cutting edge technology has fostered rapid innovation throughout various industries over the past ten years. This rapid change is impacting the financial services industry with full force, especially during this difficult COVID environment. Consumers and businesses are rapidly searching for solutions to meet their needs. Examples of this change include real-time P2P and contactless payments, investment robo-advisors, free stock trading, and app-based financial technology such as Dave™, Chime™, and Square’s CashApp.  

Additionally, historically low-interest rates, coupled with an uncertain economic environment that has stunted the appetite for lending at many institutions, have put pressure on banks to find ways to generate revenue.

Deepening relationships with existing customers is one avenue financial institutions will travel as they revamp their strategy to generate revenue while also helping customers navigate their financial journey. One challenge with this strategy is the fact that every customer has a unique journey. A one-sized approach to helping consumer and business customers in their time of need is no longer effective. Data-driven intelligence is necessary in today’s world to create personalized solutions for customers that meet their immediate and future financial needs. A powerful way to develop insights that will assist FI’s in deepening relationships is through analysis and evaluation of electronic financial transactions. IFM provides an easy to deploy solution that provides near real-time customer insights.  

Using IFM’s service and capabilities, FI’s can –

  • Utilize powerful customer insights to aid in the development of new and innovative products and services
  • Identify changes in customer behavior and predict future needs in near real-time
  • Have a resource that provides clean data to power AI and machine learning initiatives
  • Know whom to communicate with and when to communicate personalized messages

If you’d like additional information on IFM’s service and capabilities, or would like to learn more about IFM’s free, no-obligation evaluation of ACH and Card data, please contact us via our website, or reach out to me directly via my LinkedIn page or my email address at [email protected]. I’ll look forward to communicating with you and helping you along your journey toward developing an enhanced data-driven customer intelligence capability.  

Check out my latest vlog where I share more about the challenges customers are facing during the global pandemic.

 

 

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