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iPad tablets bring challenge to online banking
NEW YORK (12/5/11)--Just as banks and credit unions have begun proudly touting their new mobile banking services for devices such as smartphones, the iPad and other tablets have arrived, presenting an entirely new challenge for online banking.

Credit unions will need to keep abreast of the new devices, which are a cross between smartphones and computers, because large banks are already moving in to offer tablet-specific applications, and the iPads are among the biggest selling items among holiday shoppers.

Eight percent of consumers had tablets before the holiday season began. Black Friday sales of Apple's iPads beat forecasts, with Apple selling 70% more units than last year. Research firm Jeffries predicted  that sales may nearly double in the fiscal year that began in September.  The firm estimated Apple could sell 65.4 million iPads, almost twice as many as it sold in the 2011 fiscal year (E-Commerce Times.com Nov. 30)..

That means there will be a whole lot of demand for banking services to fit the devices.

So far, about 30% of the nation's largest banks offer a tablet-specific application--and that's just for iPad users, Mary Monahan, head of mobile devices research at Javelin Research & Strategies, told Reuters (Nov. 23).  None of the banks surveyed have a specific app for iPad's Android-based competitors such as Kindle Fire--yet.

The lack of services for these devices can add up to frustration for the tech-savvy  consumer who wants to be cool while banking on the go. And that's the challenge for credit unions: How to serve this market while keeping personal financial information secure and while serving members engaged in all the other mobile and online channels of service delivery.

A designer of mobile banking programs, Clairmail, noted that the devices aren't smartphone banking and they aren't a shrunken version of online banking, said Reuters.

They will present some security challenges for sensitive information. Apple has provided device and data protection such as passcode policies, encryption, and remote wipe/local wipe functions to remove data and deactivate the iPad if its lost or stolen.  It also supports security technologies and protocols to enable a secure connection for remote users, but, according to an article in the March/April 2010 Colorado Banker and CoNetrix.com in November, training users never to connect to unknown or ad-hoc networks will be a challenge.

The biggest vulnerability, said the article, is the browser-based vulnerabilities. Financial institutions will need to consider the risks involved and adjust their policies, controls and user training.

Financial institutions need to serve this space because it's going to revolutionize banking the same way the smartphone did, said Monahan in the Reuters article. "The banks have to be ready for this."  She noted that software developers hired by financial institutions are under pressure to quickly get their clients into the tablet marketplace.


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