In the past two years, Alex Carriles has accomplished a lot at Simmons Bank in Little Rock, Arkansas. He launched a new digital-first account called Coin Checking that’s attracting young customers. He introduced a new account-opening process that scans applicants’ driver’s licenses and sends that data to state motor vehicle bureaus to be verified. He set up a customer experience testing center where developers and designers watch while customers try to use the bank’s app and website.
The work is starting to bear fruit. About 7.2% of all consumer checking accounts opened in the second half of 2021 were through Coin Checking. The number of transactions handled over digital channels rose 40% from the first quarter of 2021 to the first quarter of 2022.
His achievements earned him a spot in American Banker’s Digital Banker of the Year 2022 program.
“Some of the neobanks are trying to get there, but I don’t think any other bank in their peer group is doing something like” Coin Checking, said Stephen Scouten, managing director and senior research analyst at Piper Sandler. “Not even close to it, frankly.”
Simmons Bank, which has $24.7 billion of assets, is “doing a good job of trying to support the digital side, bringing in consumer deposits, creating better access to the bank,” Scouten added. “I think it’s definitely moving the needle for a customer base that community banks normally don’t get much of, which is folks under 40.”
Overall, Simmons Bank is “doing the things that they need to do to be relevant in the evolving landscape,” Scouten said.
Slow phase-in of new app
A year ago, Carriles, who was previously executive director of mobile, online and digital accounts at BBVA USA, switched Simmons’s digital banking platform from Jack Henry’s NetTeller software to its Banno offering. (Jack Henry acquired the startup Banno in 2014.) Instead of doing an overnight or weekend conversion, as is customary, he rolled out the app and let customers take their time gravitating to it.
“We told our customers we have this new app and we think it’s great, we think you’re going to love it, but we’re not going to force it. Here’s the link, download it if you like it, keep using it,” said Carriles, who joined Simmons in 2019.
Those that switched were asked to delete the old version of the app. But customers who didn’t want to switch were allowed to keep using the old one.
“The response was phenomenal,” Carriles said. “At BBVA, we switched platforms several times, and sometimes it was really painful for customers to have to switch.”
Within 45 days of launching the Banno app, close to 95% of users were on it, Carriles said.
“They moved and lo and behold, we went from 2.1 or 2.3 stars in the App Store to 4.8,” Carriles said. “And a lot of them were using the word ‘love’ to describe their new digital banking relationship. As I told my team, when was the last time you saw the words ‘love” and ‘bank’ together? I think a big part of that was giving the customer the choice, so they moved at their own pace.”
Ben Metz, chief technology officer at Jack Henry and co-founder of Banno, said Carriles has created the best account-opening experience that he’s seen.
“Alex has been the absolute best partner I could have ever imagined, primarily because he had a lot to do with building a mobile product at BBVA, led mobile there and understood the challenges of the underlying infrastructure to get the kind of user experience that you want for a customer,” he said.
With Coin Checking, Carriles’s team launched the bank’s first product with a fully digital origination process.
The application asks for a few pieces of information: email, employment status, employer and Social Security number. Using their smartphone, customers scan their driver’s license or state identification card. A third-party solution called IDscan, which is integrated through APIs, scans the card, takes a live picture of the user and analyzes and validates the data. All the information is decoded from the barcode on the ID and transmitted to the American Association of Motor Vehicle Administrators to validate its authenticity.
New accounts can be opened in less than five minutes, Carriles said. Customers aren’t required to fund the Coin Checking accounts when they open them. Carriles considers this step an unnecessary source of friction. Skipping this step during account opening avoids the nearly 70% drop-off rate at the funding stage that other banks have, Carriles said. Customers can add money to their account later, through PayPal, Zelle or direct deposit.
One thing Carriles wanted to do early on was integrate online lending into the Simmons banking app.
“He hired a team of developers and was able to get this working in our underlying, contract API within about six weeks and then our teams tested it and it worked the first time,” Metz said.
Carriles also built video tutorials to help customers understand how to do things in Simmons’ app, like pay bills. If you look at the App Store today, you will see some complaints about glitches and people getting locked out of their accounts. Carriles said this may be the result of the recent acquisition of Spirit of Texas Bank and the migration of its customers to a new platform.
The Gen Zers and millennials working on Carriles’s digital team constantly challenge the status quo, he said, and let him know when something sounds stuffy. They pushed him, for instance, to change the legalese around terms and conditions to, “Please agree to the following and make our lawyers happy.” This kind of more casual language is common in challenger banks like Chime, but less common in traditional banks’ apps.
“We look at lots of data sources, research and the experience of our team members and sometimes just add a twist on how we can improve something,” Carriles said.
Carriles also relies on customer testing and focus groups. He set up a customer experience center where customers and employees test new software and tools his team develops. The room is equipped with high definition cameras that happen to be the same model as those used in the Big Brother house. In another room, the bank’s developers and designers observe what is happening on large screens.
“You can learn a lot from being able to read people’s reactions,” Carriles said. “We can even zoom in on the user’s eyes and you can see their pupils dilating when they’re looking at something and they start to get worried because they don’t understand what they’re looking at.”
The designers might realize, for instance, that a customer can’t find a button and figure out a way to make it stand out more, perhaps by making it larger.
“So we’re not just trusting that we have great designers, but we’re putting them through their paces with the user experience lab,” Carriles said.
Fraud fighting efforts
Simmons Bank’s method of having state motor vehicle bureaus verify new customers’ driver’s licenses brings security to the process. It makes it nearly impossible for someone to open an account with a counterfeit driver’s license, Carriles said. It also eliminates the possibility a customer will make typos.
Carriles’s team has added security to mobile deposits by analyzing every customer every day for hints of risky behavior. If a customer has had several instances of insufficient funds or going negative on their account, for instance, that person may become ineligible for mobile deposit.
The bank also reassesses mobile deposit limits every month based on account behavior, average balance and usage. If someone tries to log in from an unfamiliar device, the bank requires two-factor authentication. All transactions are monitored for signs of fraud.
Through all these efforts, Carriles’s team reduced fraud on the bank’s mobile deposit platform by 96%.
“Fraudsters try to take the path of least resistance,” he noted. “We look at security as a bulletproof vest. It’s not one solid, massive thing. It’s made of many layers of Kevlar and other materials that stop the bullet.”
Anyone who has met Carriles or heard him speak at a conference knows he is passionate about his work.
“His level of enthusiasm is contagious,” Metz said. “He is unbelievably enthusiastic all the time and I have never heard him be negative. If my day needs to go better, I’ll call Alex.”
Even when challenges arise, such as a credential stuffing attack, Carriles doesn’t waver, he said.
“When I’ve done those calls with Alex, he’s encouraging, thoughtful and he wants to understand why we’ve had challenges we’ve had,” Metz said. “Even in tough, tough situations, he’s still enthusiastic.”