Categories
computing

Kiwibank wastes $90 million on software – Reseller News

Kiwibank software

At Reseller News, Rob O’Neill writes:

Kiwibank has booked a $90 million impairment in its software assets and flagged a major change in its SAP core banking roilout.

“Although the strategic review has not yet concluded, a potential change to how we build the core ‘back end’ IT system (CoreMod) to match the demands of the ‘future front end’ has prompted a re-assessment of the value of the work in progress since successfully migrating our batch payments to SAP,” the bank said today.

Source: Kiwibank books a $90 million impairment on software – Reseller News

You have to wonder why boards tolerate large-scale SAP projects when the failure rate  is so high.

I’ve been told, off-the-record, by a number of high-ranking technology executives that dumb decisions are imposed from the top down with CIOs left to carry the can and pick up the pieces.

One recurring theme is that most of the cost and time overruns are due to extensive integration and customisation.

Make that unnecessary integration and customisation.

It is as if every bank or large business has unique, arcane and esoteric processes that can only be covered by expensive and risky software rewrites.

We know that simply isn’t true.

To think there is something magic tied up in those processes is madness. And expensive.

A smarter strategy for a bank, or any large-scale enterprise, would be to purchase off-the-shelf technology and redesign internal business processes to fit the software. Packaged software usually comes with flexible enough options and settings to cope with essential exceptions.

That’s how it works for small businesses buying accounting software from firms like Xero. Speaking of Xero…

Categories
computing

Here’s the thing about Apple Pay and banks

Apple insists banks don’t pass on Apple Pay charges to customers. Banks accept this in most countries. But not in Australia and, by extension, New Zealand.1

Wrangling over the issue slowed Apple Pay’s progress in both countries.

Three of Australia’s four big banks asked that country’s regulator for permission to negotiate with Apple as a group.2

The fourth bank, ANZ, has its own agreement with Apple.

On Monday Westpac, Commonwealth Bank and National Australia Bank took fees off the table. In return they want Apple to open up the NFC chip in iPhone. That will allow them to run their digital wallets in direct competition to Apple Pay.

The dispute is almost academic. Digital wallet take-up rates are miniscule. For now digital wallets are a rounding error in transaction statistics. Yet everyone involved thinks they will soon be huge.

The Australian reports ANZ completed 10 million Apple Pay transactions since launching nine months ago. This compares to seven billion credit and debit card transactions in a year.

Banks and phone makers expect digital wallets to take off when they add other features. Driver’s licences, loyalty cards and membership schemes are at the front of the list. So are public transport cards.

Replacing wallets with Apple Pay

Both Apple and the Australian banks hope people will one day no longer carry conventional wallets. Both want the game to play out their way.

The key to understanding the dispute is that both sides are big, powerful semi-monopolies. Both want control and both want to clip the ticket on every transaction. It can mean rivers of gold.

The Australian banks argue that opening up the iPhone NFC chip will allow innovation to flourish. Apple argues customers will get a better digital wallet experience if it retains control. Among other things it means customers can run cards issued by different banks from a single app.

Banks elsewhere might be as uneasy with Apple Pay, but few banking markets are as tight-held as Australia and New Zealand. This gives the local big banks a clout that, say, US banks don’t have.

Customers want them all to get on with it. A handful of geeks have swapped to ANZ to use Apple Pay. If that trickle was a flood, the other banks would soon change their tune.


  1. That’s because Australia’s dominant big four banks are also New Zealand’s largest banks. ↩︎
  2. Good question. I’m glad you asked. In normal times it is illegal for competitors to collude with each other. Regulators fear this can lead to bad things for customers. ↩︎

 

Categories
work

Capital Markets: Trans-Tasman balance is swinging our way

A story I wrote for the NZ Herald Capital Markets report:

A strong economy is boosting interest in NZ assets, as ASB’s Henry Withers tells Bill Bennett.

After a significant, extended boom riding the back of high commodity prices Australia’s economy has now slowed.

Henry Withers, ASB general manager corporate banking, says that as a result, a rebalancing between the Australian and New Zealand economies is under way that is leading to an increase of trans-Tasman investor interest in New Zealand assets.

“Our economy is stronger than Australia’s at the moment. We’re seeing better relative GDP growth, here forecast GDP growth is 3 per cent compared with 2.4 per cent in Australia.

Read the full story at the NZ Herald…

Categories
mobile

Westpac NZ claims world first finger scan banking

Westpac New Zealand says it hopes it’s customers will soon be able to use fingerprint scanning as a quick way to get secure access to mobile banking, At the moment it is at the ‘proof of concept’ stage. When it arrives, it says the technology will be a world first.

The bank has a video showing how the technology works. To use fingerprint recognition customers need the recently launched Samsung Galaxy S5 smartphone which has a built-in scanner.

Recent months have seen a concerted effort by Westpac NZ chief digital Office Simon Pomeroy and his team to lead the way with innovative banking technology. Earlier this year Westpac demonstrated a banking app for Google Glass and there is also an app for the Samsung Galaxy Gear 2 smartwatch allowing customers to see balances by glancing at their wrist.

 

Categories
computing productivity

Westpac’s premature Google Glass app

Officially no-one in New Zealand should have a Google Glass device. The wearable computer isn’t on sale here and enthusiasts who want to buy one ahead of it being available find themselves bumping against barriers.

And yet Westpac says it is trialling its Cash Tank app on Google Glass. It says the app will be available in New Zealand when the product does go on sale later this year.

Clearly there’s some positioning here. Westpac wants to be seen as innovative and up with the play. Yet talking now about software for a device that isn’t on sale and is highly questionable smacks of desperation, like the kid who tries too hard to be cool.

In the press release Westpac chief digital officer, Simon Pomeroy says: “By the end of this year our customers will be able to walk into a shop wearing their Google Glasses, see something they like and instantly check their bank balance which will be displayed in their peripheral vision – that’s pretty cool”.

Or not.

This worries me because Glass is controversial and unproven. It appeals to a certain creepy geek demographic. It may fail – risky new devices often do. At best less than one percent of Westpac customers will have Google Glass this year – probably a lot less than one percent.

So what is Westpac doing spending money on developing apps for such a tiny niche? Is that cool or reckless.

Sure, Westpac’s online banking software is massively improved, but it’s not perfect. I’d rather see the bank spend its development time and money getting the basics right and not playing around with Glass.