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Bank of America (BofA) was granted the most patents of any financial institution in 2018 and is among the top 10 holders of US banking-related patents and applications, according to a ranking of the top 300 organizations granted US patents from the Intellectual Property Owners Association cited by Finextra.
The bank was granted 318 patents in 2018 — up 9% from 288 in 2017— bringing its overall patent portfolio to over 3,500 patents and applications, 24 of which were for its digital assistant, "Erica." Few other major banks made the top 300, although Capital One came in the 194th spot, with 162 patents.
BofA's ranking is indicative of its zealous approach to the in-house research and development of new technologies:
- It has conducted extensive research into blockchain technology.BofA is the staunch patent leader when it comes to FIs working on blockchain tech: It held 82 blockchain-related patents as of June 2019, dwarfing other banks like TD (11) and JPMorgan (6). And while the bank has so far struggled to actually adopt the technology, citing scaling issues, it at least boasts a solid reserve of intellectual property it can develop and try to bring to market.
- It's been building out its virtual assistant Erica with a slew of new features. The voice assistant surpassed 6 million users earlier this year, and BofA has given it several new capabilities since its launch in May 2018, including the ability to flag recurring charges and alert users about upcoming bills. These kinds of value-added features can help drive both higher usage of Erica and deeper digital engagement overall.
- The bank debuted a digital debit card feature in its mobile app in June. The card can be used for in-store, in-app, and online payments as well as to make deposits or withdrawals at BofA's cardless ATMs. Providing a virtual card can be hugely useful for clients currently without a physical debit card — because they had to cancel a card due to fraud and are waiting for a new one, for example — as it helps give them less interrupted access to their finances in the interim.
But developing new technology in-house can also have its risks: Crafting new proprietary tools and features takes time and resources, and the results are not always guaranteed. Chase, for example, ended up shuttering its digital-only bank Finn, citing poor adoption because of a failure to differentiate from Chase's other options.
So, as BofA or other banks seek to develop new technologies, it's important to have specified goals and use cases for that tech to avoid expending time and money on what turns out to be a dead end.