Remote Deposit, Remote
Service
It Changes Everything
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
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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
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
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
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Banks with Image-Enabled ATMs Banks without Image-Enabled ATMs
36%
41%
18% 21%
ATM Channel Preference for Depositing Funds
2012 2011
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)
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
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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