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Memo to banks: where are the memos?

by Mike B. Fisher on November 17, 2011

Quick Summary: In this article I highlight a simple but important feature missing from many bank and financial websites. I also show an example of a bank that has the feature but implements it badly, and one that offers the same function but a much better experience.

The more a company relies on technology to serve its customers, the more it has to gain or lose by the quality of its online user experience.

Increasingly, companies have begun to get the message. However, I’ve noticed that financial service websites often lag behind in adopting user-centric features.  One in particular stands out as either missing or badly implemented.

Check, please

If you’ve ever written a paper check, you’ve doubtless noticed that every one includes a memo section – an area set aside to record freeform details about the transaction. And if you’ve ever reviewed past checks during tax season or had to dig up information on a long-ago purchase or payment, you’ve likely benefitted from the information stored on that humble memo line.

Surprisingly, few banks and brokerages enable users to associate memos with the individual transactions on their accounts. And of those who do, many have implemented it badly.

This is a mystifying oversight. There are compelling reasons to enable users to create transaction memos:

  • It helps users identify and differentiate between transactions
  • It mimics the “real world” experience of writing or receiving paper checks, where the use of memos is commonplace
  • It provides similarity to the “checkbook register” paradigm used by Quicken and other popular finance applications
  • It gives users greater control, a key usability principle

It’s worth mentioning that those who use Quicken or a similar product have the option of adding memos to their transactions once they’re imported into a central “register”. There’s no reason not to offer a robust memo capability within each financial sites’ web interface.

You’re doing it wrong

Let’s look at example of one website that falls into the category of “close but no cigar”. ING Direct’s website includes a memo function – but greatly limits its usefulness.

ING strictly limits the usefulness and usability of its memo function

ING users can opt to include a memo any time they initiate a funds transfer. This is good, but consider the limitations. For starters, the memo must be less than 25 allowed characters. Many symbols, including periods and percentage signs aren’t allowed.

Here’s an example of a memo that’s not allowed by ING’s memo restrictions:

“Repayment of 25% of John Smith’s loan from June, 2011.”

This is too many characters for ING Direct, and the percentage sign and period are disallowed. (It’s slightly amusing that a financial website disallows the use of common numeric and accounting symbols.)

ING’s memo function forces users to conform to its limitations rather than adapting to the way its customers might wish or expect to use the website. That’s a big user experience no-no; users should not be forced to conform to seemingly arbitrary system limitations.

There are other problems with the way ING implements its memo function. For example, users can’t add a memo to a transaction after the fact – only when initiating a transfer from the ING Direct website. Why not give users the freedom to create a memo after the fact?

The prescription here is simple:  ING Direct’s website should handle freeform memo entry without restricting “special” characters, and should allow longer entries – at least enough for a complete sentence. And make it easy for users to see and add memos after the fact, not just at the time of the transaction.

There, fixed it for you

By contrast, Chase mostly gets it right by enabling users to add memos to their account transactions with far fewer restrictions.

Chase's memo function is considerable more flexible and usable

Chase’s memo function is relatively flexible, enabling users to add a 50-character memo to a transaction at any time. Unfortunately Chase makes a variety of other UX mistakes in its online accounts. But that’s a topic for another day. Compared to ING and others, they’re ahead of the curve for memo functionality.

For all their desire to create a paperless financial system, the big banks and brokerage houses would do well to consider how their customers operate in the real world, and design their user experience around customer behaviors and needs.


Photo by Miss Mass. Creative Commons Licensed.

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{ 1 comment… read it below or add one }

Michael Heraghty December 22, 2011 at 9:19 am

Excellent Insight Mike. I have experienced a similar problem with my bank in Ireland, using two separate systems, where the transaction description field is ridiculously short.

This is a problem not only for me in identifying the transaction later, but also for a third party, when I am transferring funds — for example, if I want to indicate an invoice reference number in the description. (These are two different fields, but the issue — arbitrarily short character limitations based on system constraints — is the same.)

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