When the coronavirus pandemic hit in 2020, banks were among the many institutions moving quickly to adapt to all the changes that came with it.
Suddenly, digital banking was on the rise as fewer people went to branches in person.
When it came to institutions moving quickly to meet shifting consumer needs, JPMorgan Chase was no exception.
FinLedger talked with Rohan Amin, Chief Information Officer (CIO) of Chase’s Consumer & Community Banking (CCB) unit, about the acceleration and the various ways his firm has navigated the pandemic.
Amin manages a technology budget of $4 billion – one-third of Chase’s overall $12 billion budget – and over 12,000 technologists globally. He is in charge of all the tech in the firm’s branches, ATMs, on its mobile apps and all its digital properties.
In this compelling interview, Amin shares details on everything from just how much mobile usage is up year over year to how Chase is embracing video and what the firm sees as the next big trend in banking moving forward.
FinLedger: One of the things we’ve all seen obviously with the pandemic is the increase in digital banking. How has Chase adapted to this? I assume you were already in the process of transitioning more functions to be digital or mobile but how did the pandemic accelerate any of those initiatives?
Amin: We’ve definitely learned a lot from the pandemic. And in many cases, the pandemic really has accelerated the shift toward digital banking.
People want to be able to bank online and not have to necessarily always go in person. Here’s just a couple of stats for you. We have about 55 million digitally active customers, which is up 6% year on year, and now we have over 40 million active mobile customers, which is up 10% on a year-on-year basis. To give you an example of a customer behavior that has certainly changed during the pandemic, we look at pre-COVID and current stats. Right now, mobile check deposits are a great example of that. Depositing a check using a mobile device now represents 40% of all check deposit volume. And pre-COVID, that was 30% – that’s 10 percentage points movement during the COVID period. And we’ve had mobile check deposits for a while, so it’s a good example of just the acceleration that we’ve seen in there.
Another one would be home lending. If you think about getting a mortgage, it’s one of the most important financial transactions for people in their lives, but you know the amount of forms and paper and other things that are involved with that. But now, more than half of the applications for home loans are being completed digitally, which is twice the volume that we saw in Q1 of last year. Another example of how even with something as sensitive and personal as mortgage applications, we’re seeing huge adoption of digital.
Also, we had recently done a study of digital banking attitudes and customers’ perception of banking digitally. A significant number of customers, more than 50%, agree they use digital banking tools more due to the pandemic than they did the year before. And so it was happening before the pandemic. But certainly, the pandemic has certainly accelerated some of that as well.
FinLedger: What specific initiatives did you maybe begin last year or, or double down on as a result of all this increased digital adoption?
Amin: There were a number of things last year – and it seems weird to call it last year but I guess now it is, right? – that we have done, mostly to make sure that we were there for our customers when they needed us most. Also there was an array of things that happened last year that weren’t on, if you will, the 2019 radar screen or plans. You know, we had to get the Paycheck Protection Program rolled out and help small businesses and now we’re doing that again. Obviously we continue to focus on stimulus. We had to get checks, and people’s stimulus payments out to them in a timely fashion and we’re doing that right now as a matter of fact with the bill that was recently passed.
We also had to make sure that we could help customers with making payments, whether it be to our credit card or our home and auto loans. Specifically, how do we make that easier for them while they’re facing economic challenges?
Those are all examples of pretty significant capabilities that we had to build, develop, test and roll out in pretty short order to make sure that we were meeting the needs of our customers – initiatives that were kicked off during the COVID crisis and were not part of the plan at all.
FinLedger: I’m curious how do you work with the other business unit CIOs within Chase and then with corporate?
Amin: I’m a part of the overall firm, and the firm has four major lines of business. The four lines of business are the corporate and investment bank, our assets and Wealth Management Group, the commercial bank which is focused on sort of mid market and then Chase, or what we call internally, consumer and community banking. The two large ones are Chase and the investment bank. There are technology leaders for each of those organizations, and we all work together, because in many cases, there are capabilities and things that we leverage across, and certainly some platforms and other capabilities that we leverage. The global technology leadership team works for Lori Beer, who is the global CIO for JPMorgan Chase.
FinLedger: What types of projects and systems are managed at a corporate level versus the respective business units?
Amin: At the corporate level, we have a common infrastructure that we run for the firm. My team, as an example, is mostly focused on running the applications that run on top of that infrastructure. So I’m not dealing with servers and management of servers and infrastructure and that sort of thing. But my team is focused on writing the applications that run on top of those servers and so the infrastructure is an example of something that is run centrally and for everybody. Another great example is the work that we’ve done on artificial intelligence and machine learning, where we leverage a platform that the firm builds for everybody. And it’s called Omni AI. It’s our firm-wide platform for machine learning, and my team is a consumer or a user, if you will, of that platform. That’s the platform that we use to enable all the machine learning capabilities and benefits that we want to provide to our customers.
FinLedger: Can you talk about instances where you guys have opted to build out certain technology internally versus contracting out to other providers?
Amin: We do both and we do certainly partner with other companies and fintech organizations and obviously, we build a lot internally. Determining which one we do honestly depends on the particular thing we’re talking about and there are so many nuances to that. We look at the particular use case and in some cases, it makes sense to partner and in some cases, it makes sense to build internally.
But if you think about Chase.com and the mobile app and the things that customers are interacting with, the core parts of that experience – that’s all stuff that we build in-house. But there are some cases where we work with third parties, or vendors that we work with who have specific technology capabilities, or a fintech that we’ve partnered with.
A good example is the partnership that we have with Greenlight, with whom we launched an initiative that allows a child to have a checking account.
FinLedger: Do you have a preference for working with enterprise suppliers such as AWS or IBM versus startups or earlier stage partners?
Amin: We work with them all. Our scale and size is such that we end up having a relationship with many of these companies, and certainly the large ones such as AWS, Microsoft and Oracle and all the companies you normally think of there. And then startups for sure such as Greenlight.
Again it just depends on which particular use case and which particular thing we’re trying to solve for. We are very focused on making sure we understand the ecosystem of technology, innovators and solution providers that are out there and we have a pretty robust engagement with the West Coast and Silicon Valley companies.
FinLedger: What are your thoughts on blockchain and crypto as an organization?
Amin: We’re watching the space and seeing what’s going on.
FinLedger: What are some of the trends you see moving forward?
Amin: Machine learning and AI (artificial intelligence) are definitely going to be taking a greater role in areas such as investment recommendations and how much money to save would be an example.
We have a new feature that we launched in our app called Saved Account Manager. It tells you your recurring payments and so, for example, if you have your credit card embedded in Amazon or Netflix or wherever else you have it embedded, it will tell you that there is a recurring charge from that particular company. It’s a great tool to find that kind of stuff because sometimes people subscribe to things and then they forget they have it.
Also, we know machine learning is also having a significant benefit for fraud prevention, something that customers are always very concerned about. We process tens of millions of transactions daily and use our machine learning models to make sure that we’re better able to determine what transactions are fraudulent or legitimate, and which provides a better experience for customers. And also, that provides a better outcome for us as a bank. It does things like identify fraudulent signatures on checks, for example.
Also, managing cash flow for small businesses is really important. And so we have an upcoming payments feature that we’ve created that allows a small business customer to estimate how many incoming payments are scheduled to come in based on their history. That’s another example of machine learning being used to help them better manage their cash flow.
So, machine learning has been and will continue to be a significant area of growth.
Trend number two that we’re seeing is something that we call any channel. We are very focused on building technology for everyone and doing things like, let’s say for example, you start an application in one channel, such as your mobile device, and you want to complete it at a different time on your desktop when you’re opening an account. There are also things like video. A lot of customers are getting more comfortable with video and so being able to have customer interaction over video is something that we are embracing, as well as different, forms of interaction that are coming.
I don’t want to name specific vendors, but we’re certainly looking at all the video solutions that you can think of out there. But in general, we are taking a close look at video and how we can use it to enrich the overall experience that we have with customers. Obviously it depends on which type of customer and which way you interact with them and who we’re talking about. But I think we’ve all learned that video use has increased over the pandemic period and we’re certainly going to embrace that as part of our overall approach as well.
Something that’s also really important to us is accessibility, which is making sure that you know when we launch something that it’s able to be used by customers of different abilities. And so we are paying special attention to that and working to go above the normal accessibility requirements and being very careful about making sure that when we release our software and when we create technology solutions we’re thinking about people who have different abilities, and how they interact with us. That’s an important part of our thinking and our approach is to make sure that we’re building software and technology that works for everybody.
The only other trend I would share with you is our API strategy and approach and this part is actually kind of important to how we work with other people. The APIs are the way that we can communicate in a programmatic way between two companies. We also use APIs internally, in terms of how our different services communicate together.
Here’s one example of an external use case. We launched partnerships with DoorDash and Lyft and those are benefits that we provide to holders of certain credit cards. Like, I’m able to use my Chase Sapphire card and am able to take advantage of getting a DoorDash benefit so I’m able to get free delivery of food through DashPass, which is a benefit that’s provided to Chase Sapphire customers. That type of integration is enabled by APIs. Being able to work in a friendly way with other companies and being able to bring on their capability as part of our offering to customers is exactly the type of strategy that we’re undertaking to make sure that we can bring more value to our customers, and it signals to other technology companies that we’re easy to work with and easy to integrate with.
So that’s a core part of the strategy as well as we move ahead – being able to make our services available in a tech-friendly way so other companies can plug in and hook up to our customers and then vice versa.