Loraine Lawson
Good day and welcome to Bank Automation News podcast series The Buzz. I’m Associate Editor Loraine Lawson. And recently I spoke with representatives from Armed Forces Bank Tom Kientz who’s the chief operating officer, and Jodi Vickery, who is the director of military consumer lending. I understand Armed Forces bank has introduced several new programs involving digitalization and automation this year, of course, you serve military customers all over the world. So digitalization is important to you. So if you could tell me a little bit about your digital platform, what does it do? How does Zeele fit in? And what, if anything, does it automate for you,Jodi Vickery
or we might tag team this a little bit. But I think I’d start with just explaining why it’s so important that we have those platforms for this military community. By you know, it’s a highly mobile market that we serve, they they don’t get a lot of say in the timing or the location of their whereabouts. And so we love that in many cases, they’re able to be near one of our branch locations. You know, we’re the largest on installation bank in the country. So that’s a convenience for them. But we also think it’s important to be able to be available to them if they’re not where we have a branch. And so we introduced a lot of digital oriented products and processes so that they can stay connected to us as their bank. You know, you mentioned we’ve rolled out a few things in the last 20 months, I highlight a couple and then I might see what Tom would also add to the mix. We did implement q2, which is an online banking platform late last year, that gives our clients the ability to access their accounts on their mobile device, we know this, this market really uses that medium to access their information quite frequently. So they can access their accounts. That way they can see anything they need to see about their different bank accounts they have with us. And they can also use features and functions like Zelle that you mentioned, or another one called transfer now to move money. And so it kind of depends on who they’re moving money to, and which one of those they choose. But you know, with a military family, it’s often that they’re not where the rest of their family is, you know, they’re deployed, or they’re somewhere across the country, where from where home bases, and maybe they need to send money back home, sometimes they need to do that urgently. Those types of functions give them a way to do that, in many cases instantaneously, which which we really enjoy being able to provide for them. The second one that I’d highlight that we have rolled out, really at the beginning of this year, is our new access loan program. You know, we know that life happens, military families have the same unique challenges that every family has, um, there’s just get aggravated, sometimes by uniquenesses of the military lifestyle, like I said, you know, frequent moves, no military move that I have ever embarked on as a military spouse was free. And so you have expenses that go with that, they might need to get across the country for an emergency or something. So we looked at that need, and we stood up an access loan program, and for our current clients, it’s, it’s a very easy process, they go online to apply and from the time they apply to the time, we can get auto approve them, and put money in their account with us, it can happen as quickly as four minutes. So you know, it’s it’s really a nice opportunity to serve a need right then right there when they need that. Certainly, they can come into one of our branches and access that access loan program, maybe Pun intended there. But they, they don’t have to, they can do that all online. You know, I see clients applying at one in the morning. And you know, assuming that they’re, like I said, auto approved, and we don’t need any additional documentation. They can have money in their account at 104 in the morning, and beyond their way to deal with whatever they needed those funds for. So we’re really excited about having that available to them now. And we think it meets a unique need at this market.Tom Kientz
One thing I would add to what Jodi has already shared, one of the reasons we did this is most military members, you know, when they started the military, if they’re right out of high school or a new recruit, they show up at maybe Great Lakes or one of the recruiting sites across the country. One thing they always have is a smartphone. And all of these solutions with our digital banking work with the phone, you don’t need a laptop, you don’t need a desktop. And it really resonates well with the younger military members. And these products are absolutely suited for them. And even better, even older military members if you want to call them that if they’ve been lifers in the military, they tend to skew more towards digital solutions because they are used to those things because they’re transient. They move a lot and they are they’re not tied to a desk. They’re out in the field. And we designed all of these with the view that you can do them from your phone.Loraine Lawson
Okay, now that’s automatic crediting slipping a little question here, is that AI based or have it? Hey, tell me a little bit more about how that works.Jodi Vickery
For the absence loan program? It’s really just based on how we have integrated the different platforms that we use to pull that off from our loan origination platform to our core, and the interconnected processes behind the scenes using API’s web calls, things like that. So that that process can run 24. Seven, even if we may not have somebody sitting here at the bank at one in the morning just to look at that loan application.Loraine Lawson
So a lot of automation at play there. It sounds likeJodi Vickery
Absolutely, absolutely.Tom Kientz
Yeah, the four minute scenario that she depicted, no one sees that, I mean, it just flows through the system. And one of the things that I think makes us a little bit unique too with that program is we base a lot of the underwriting decisions off of the soldiers behavior in the account, and not so much on traditional credit metrics, we don’t just look at your credit score and say, okay, you’re either above this line, and you’re out, we don’t do that we have, we have some proprietary information that is completely automated, that makes it very easy and unique, and absolutely serves the needs of our client base.Jodi Vickery
Abosolutely great point. Um, when we look at that product, and we look at what was available out on the landscape for military families, this product serves a need where a lot of banks and credit unions just aren’t willing to play, because they do the opposite of what he just described, they look at you and say, You know what, if you don’t have above an X five, go score, we’re not gonna even talk to you about a consumer loan. And we just think there’s a lot more to a credit assessment for a military person than meets the eye, and certainly more than a FIFO score would indicate.Loraine Lawson
Yeah, you know, I think banks are going to be more interested in that kind of solution. As they try to reach the end bait. I’ve heard more talk about alternative credit decisioning, which is, I guess, where this would fit in. Of course, VA loans are very important to your clientele, how has making VA loan experts available digitally worked, and changed your ability to loan to bets and is courser an automation involved?

Jodi Vickery
Sure,

Tom Kientz
I’ll take that one. We have a very robust VA Mortgage department at Armed Forces bank. And I’ll tell you a story. I think that’s maybe the best way to explain this our top originator, you know, the person who does the most loans at Armed Forces bank is a military spouse. And in the 10 years that I’ve worked for the organization, she’s been here the entire time, she is moved 13 times. And she could not do her level of service if we did not have the automation and the electronic connectivity to soldiers everywhere. And she just could not be successful if we did not have that. So it’s very similar to what we described with the access loan portal. If you have a VA loan, or when you start, we just send you a link directly to a online loan application within our VA process. And you can do that you can do that with your phone. I mean, it’s a little clunky with your phone. But if you absolutely can, and our top loan officers very similar to our access loan, we are receiving loan applications for VA mortgages, all times of the night, throughout weekends, just whenever they are available. And we can accommodate that, which makes it really nice. 20 was especially busy for us in the beam orange world with interest rates at you know, historic levels, you know, hopefully everyone has refinanced by now, but if you haven’t, you know, they’re still very low. And we were able to take care of many, many military members and by giving them a much lower rate, it was quick, it was easy. You may have heard the term Earl, which is that interest rate reduction loan that is a very specific VA Mortgage program that worked very well for our clients.

Loraine Lawson
Okay, any other automations this past year? Um,

Jodi Vickery
well one thing that just kind of foreshadow for you a little bit in the mortgage space as well. We are we are working hard to implement some new technology that will supplement everything that Tom just described. And it will allow us to communicate in very straightforward plain language ways some of the things that can get really complicated mortgage documents and do that electronically. So we can provide people electronic access to read these plain language reviews of the mortgage that’s being offered to them. It doesn’t replace certainly the required legal disclosures and such. And we’ll also be able to send them video snippets that describe the offer that walk them through the documents, so that they can review that on their own time. Or they can even forward the link to that video to family members. You know, like I mentioned, they may not live close to close to where home basis, it may be their first mortgage, if it’s a younger service member, maybe they want their parents to look at or maybe they want a trusted adviser to look at it, they can shoot that link off and have somebody else take a look at them, look at that with them and give them advice and, and weigh in on that big, big life decision they’re about to make. So we’re excited to be able to have that we just think it amplifies a way to explain products to our clients in a way that we can do wherever they’re at in the world.

Tom Kientz
It can be one other example of some automation we put in place. That is it’s not specific to mortgage, but it’s just general banking. And I like to tell stories, because I think it resonates with people a little bit better. But typically, if you are a customer, you’re a soldier and you have a question, you grab your phone, you probably have the mobile banking app for your bank, and our horses bank is no different. You click on that, and maybe you’re looking at some transaction history. And you see a transaction and said cash, I don’t remember what that was. And I need to find out what that is the typical bank at that point, then you have to Okay, you have this up, then you make a phone call directly to your bank. And your bank asks you all these weird questions like when did you open your account? When was your last deposit all of those authentication questions, we knew that was a friction point for our customers. So what we put in place was a chat solution. That you know, once you’re in the your mobile banking app, you’ve already put in your password or your face recognition. So we know who you are. And there is just a icon right at the bottom of the screen. It looks like a chat bubble, you can just click on that and immediately start chatting with a a banker at Armed Forces bank and they can you can ask a question via text. Essentially, you’re saying, Please explain what this transaction was. And then a banker can answer that we already know who you are. So there’s no extra questions that we have to answer. We could just we could just start Lorraine, how are you? And we can start answering your question. And even better than that, if that chat conversation goes on too long, with the click of a button, we can upgrade that to an actual phone call. And that and it’s connecting the two people who are already chatting. And, and even further than that, if you so choose, we can upgrade that to a video call. And that’s just a new feature that we added to our digital banking. And we put that in place on April, mid April of this year. So we’re about three months into it. And already we’re handling about 1000 chats a day. For our customers, they love it because they’re used to texting all day long. That’s how they communicate. And so now they’re just texting with their banker, and their banker knows exactly who they are because they’re already within the mobile banking application.

Loraine Lawson
Oh, sounds like you all really have a jump on the digital banking movement. And I think you sort of started out ahead since you were dealing with younger client base and you know, a remote client base. So what advice do you have for base that maybe you’re new or just exploring how to support customers remotely via digital technologies?

Tom Kientz
Well, I think the best advice is, you know, the future is already here. And you better get on board. Because I think, yeah, we’re not going to go backwards. And it The interesting thing with banks is when you ask a client, why do they bank somewhere? It’s almost always because the bank is close to where they live and or work. But then you ask them a follow up question. Do you ever want to set foot in that bank again? And the answer’s no. So it’s, it’s interesting. It’s an interesting dilemma for banks, that we have to figure out how to maintain that physical presence to start the relationship. But to maintain the relationship, you have to have a digital solution. And if if you don’t, you’re behind the times, and especially with the military community, our value proposition is pretty straightforward. You can start anywhere in the country and you can continue anywhere in the world. We’re all in the bank with us because you have a smartphone. And I don’t think that technology is going backwards at all in. So again, my advice to our competitors, you know, selfishly, I hope they don’t do it, that my advice to them is, you know, the future is here, and you have to have those digital solutions to service our service members today.

Jodi Vickery
And I think the only thing I’d add to that would be, we find it’s important to do all of those high tech things, but to strike just the right balance between high tech and that personal touch. So you know, we get a lot of good feedback from our physical locations. You know, we love what our associates are doing in those offices, where we have them on installation, but even what he’s described with the chat, and how that can launch into a phone call, or even beyond that a video call where you’re, you’re able to at least see the person you’re talking to. It’s really about meeting our clients where they want to be met on that communication spectrum, and being able to just see each other face to face if that’s what makes them feel more comfortable. If it’s a complicated issue. You know, when you’re dealing with people’s finances and their money, they take that seriously. And as you know, we obviously do too, we want to make them feel comfortable. So it’s really about finding that that right balancing point between on that personal customer service, embrace of the clients, but giving them ways to do that, technically and all on their own, if that’s their preference.

Loraine Lawson
Well, I was a military spouse before smartphones were around but I can tell you, I would have appreciated all the things you’re offering your customers. That wraps up this episode of the BAS thanks for listening and please let us know how we’re doing it big automation news.com and of course on Twitter and LinkedIn. Thank you