Drum Roll, Please: The 2011 Bank Innovation Awards

Dust off your tuxedo shoes. Schedule your haircut. Get that gown altered. It’s time for the 2011 Bank Innovation Awards presented by — you guessed it — Bank Innovation.

If you are looking for Oscars-like certainty for the best of 2010, well, these are not the awards for you. The Bank Innovation Awards mark the most notable trends in 2010, or at least in this blog’s opinion. Perfect? Of course, not. Fun? We certainly hope so. And now, the winners:

Best Bank Not Yet Launched — BANKSIMPLE

While BankSimple spent 2010 in development, it deserves accolades, even before its scheduled 2011 launch. The bank-to-be made clear that it would launch as a “bank as a service,” in other words, as an “open platform” bank that can interface with third-party apps and actively evolve. At the heart of this notion is the absolute truism going forward: that banking is nothing more than software. (See here and here.)

Best Attempt to Revolutionize an Unheralded Banking Niche — USAA

Banks often, and stubbornly, ignore the realities of how consumers do things in favor of providing the services they want in the way they want it. Just look at how banks keep a stranglehold on consumer data as evidence. Auto finance is one of those banking niches that often get overlooked by banks. Not USAA. The financial services giant for armed forces veterans took a hard look at auto finance and came out with an iPhone app that distinctly considered the customer’s experience and needs first. The Auto Circle app allows for not just a vehicle loan, but actually facilitates an auto’s purchase. All via the iPhone. That sound you just heard was USAA getting a slap on the back.

Best Acquisition by a Non-Bank — GOOGLE

August was a busy month in the world of cutting-edge payments. At around the same time PayPal’s CEO Scott Thompson unveiled the company’s new micropayments product, Google announced that it was buying Jambool, a payments platform for social networks, for around $70 million. The acquisition puts Google on a collision course with PayPal for the immensely lucrative new payments paradigm within the social media-mobile complex. Some four months have passed since the Jambool deal, and while at the time I was gung-ho about it, I’m less sure Google will beat PayPal in this realm of payments. However, Jambool was a great purchase for Google, and it deserves a Bank Innovation Award for it. It’s OK to woo-hoo, Google.

Best Mobile Strategy — PAYPAL

Google might have won the coveted Best Acquisition by a Non-Bank Award for 2011, Bank Innovation doesn’t want PayPal to feel spurned, so we are pleased to present it with the Best Mobile Strategy Award. (Thankfully, we’ve got many awards at our disposal here at Bank Innovation.) Uniquely, PayPal has understood that the payments battlefield shifted irrevocably to the mobile front in 2010, and it has acted quickly to seize on it. BlackBerry’s apps largely rely on PayPal for subscription payments, and PayPal has made mobile one of its primary objectives going forward. This among other fine initiatives that deserve our kudos. 

Best Joint Venture — AMEX-ZYNGA

Best and “unlikely” is probably a more accurate description of the American Express-Zynga deal inked last month. Specifically, the deal allows Amex clients to use their Membership Rewards points to buy virtual goods in Zynga games, such as the purple cow that will cost Amex cardholders 540 points in FarmVille. It is not so much that the deal is going to be a blockbuster for either company, but more that an old-school shop like Amex and a new-kid-on-the-block like Zynga could actually come together to form a JV. Why Amex didn’t try to add some payments exclusivity deal as part of the JV is beyond me, however. And, yes, we have two statues to give the winners. What do you think we are? Cheap?

Best Financial Services Ad – E*TRADE

Babies talking about trading stocks and “that milk-aholic Lindsey” — can there be a funnier ad?

Best Non-Bank Banking Strategy — FACEBOOK

Talk about a busy year. In 2010, Facebook saw bank branches starting to pop up within its online confines; unveiled a payments product; did a deal with Target to sell virtual gift cards in a decidedly non-virtual setting; introduced a location feature that has important implications for banking; sucked up a massive amount of overall web traffic. Look, we’ve given Bank Innovation Awards for less (see Best Financial Services Ad Award above).

Best Innovation of a Tired Product – 2G CREDIT CARDS BY DYNAMICS

Dynamics makes what its calls “2G” credit cards that come with pay-with-rewards buttons and other features. Last October, Citigroup gave Dynamics a big vote of confidence by making a deal with the three-year-old startup to pilot some of Dynamics’s new card product innovations. The CEO of Dynamics says his company is “the innovation arm of an industry that never had one.” Until now. 

Best Under-the-Radar Banking Strategy – WALMART

Back in 2007, Walmart tried to secure a banking charter. That effort failed brilliantly. So what does the world’s largest retailer do? Tries again, only this time with much, much less fanfare. Last July, Walmart started offering small business loans, and nary a banker barked. Walmart now offers credit cards, debit cards, small business lending, consumer credit, in-store bank branches, check cashing, merchant processing, money transfer, and tax preparation. The only thing missing is a bowl-game sponsorship.

So there you have it, folks, the winners of the 2011 Bank Innovation Awards. If 2010 was any indication, 2011 should be an interesting one on the bank innovation front. Who knows? Perhaps we’ll need to whip up some new awards for our 2012 edition?