JPMorgan Chase launched its Finn by Chase standalone mobile bank account nationally with much fanfare less than a year ago. This was going to be how Chase attracted the millennial crowd to the bank with a cutting edge app loaded with features the younger generation demands. But it never seemed to be getting the traction that Chase wanted. I reported last month on a survey that said Chase had signed up just 47,000 Finn accounts.
Today, the Wall Street Journal is reporting that the largest bank in the country is shutting down Finn by Chase and moving everybody to a regular Chase account effective August 10. Customers will have to download the Chase mobile app and will receive a new Chase debit card but many of the features of Finn have been rolled into the Chase app, including no fees. There is one feature missing, though, and that is free ATM usage at partner ATMs.
What does this mean for other banks digital efforts? The only other large bank with their own standalone mobile brand is Greenhouse by Wells Fargo and that is still in limited rollout. Citi is creating a national digital bank but has not created a new brand. Bank of America has their virtual financial assistant called Erica but it is linked to their regular mobile app.
Maybe the large banking brands will recognize they don’t need a separate brand to attract the younger generation. In this American Banker article today Chase spokesperson, Pablo Rodriquez, said:
We know the Chase brand is already among the most popular banks for millennials, so we’re leaning in on that, rather than continuing to build a brand from scratch.
Apparently, many of the people who signed up for Finn were existing Chase customers, in fact it was more than half their customer base.
My Take
I don’t think that anyone will argue that banking is going mobile. While branches may remain important for many years or even decades the mobile app is going to be the cornerstone of any bank offering of the future. The reality is that today, more than a decade removed from the financial crisis, most large banks have trusted, if not loved, brands. There is no compelling reason to create a new separate brand to win mobile customers.
What consumers want from banks are better mobile features. The reason that consumers have flocked to many of the challenger banks is because they offer the features they want. To be successful today banks need mobile apps with simple mobile on-boarding, high interest checking accounts, no overdraft fees, no ATM fees, check deposit and budgeting tools. Obviously, a pleasing user interface is also a requirement but this is not rocket science.
Rather than continue to prop up a failing app Chase pulled the plug quickly and now can put its resources into making their regular app better. Whether this is the death knell for other banks with separate mobile brands remains to be seen but this move by Chase will certainly give others pause before pursuing that path.
Peter Renton is the chairman and co-founder of LendIt Fintech, the world’s first and largest digital media and events company focused on fintech. Peter has been writing about fintech since 2010 and he is the author and creator of the Fintech One-on-One Podcast, the first and longest-running fintech interview series. Peter has been interviewed by the Wall Street Journal, Bloomberg, The New York Times, CNBC, CNN, Fortune, NPR, Fox Business News, the Financial Times, and dozens of other publications.