mobile banking

Why Context Matters in Mobile Banking

Andres Fontao, Clairmail Executive Mobile Banking Consultant

In financial services, until only recently, the term “mobile banking” was used almost exclusively to describe a retail banking account management performed with a mobile (or cellular) phone using SMS or WAP technology. This service was first introduced in Europe (and by some accounts, on a global level) by the likes of tech-savy Nordea (Finland) and innovation-driven Bankinter (Spain) in the early 2000s. It has evolved from a one-way, informational service to become a bi-directional, transactional platform which is used by banks to generate new revenue (through cross-selling and up-selling products), lower servicing costs, reduce fraud and increase customer satisfaction.

Subsequently, as technology and mobile adoption evolved, financial institutions began introducing Java-based applications such as mobile brokerage solutions for specific handsets. Around the same time, banks took a giant leap of faith and began offering mobile internet services using WAP technology. The problem was, most banks took this as an opportunity to shrink and squeeze online banking into small mobile devices. Little did banks know back then that customers would eventually use mobile phones to apply for mortgages, subscribe to pension plans or finance their children’s university education. Read More »

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February 16, 2012 | mobile banking and Opinion | 0 Comments

Mobile Banking Reaches Critical Mass for Big Banks

EMI recently analyzed the 4Q11 financials from both JPMorgan Chase and Wells Fargo. Their analysis underlined the extent to which mobile banking has emerged as a key banking channel, while concurrently indicating that online penetration may have reached a ceiling.

  • Chase:
  • Between 4Q10 and 4Q11, Chase grew its active mobile banking customers by 57%, while during the same period active online banking customers increased by 3%.
  • Active online banking customers as a percentage of total Chase checking customers rose from 62% in 4Q10 to 65% in 1Q11, but has remained at 65% for the three subsequent quarters.  Active mobile customers as a percentage of checking customers rose from 20% in 4Q10 to 32% in 4Q11.
  • Active mobile customers as a percentage of active online customers rose from 32% in 4Q10 to 48% in 4Q11.
  • The rate of growth in active mobile customers does not yet show signs of abating.  The quarterly growth rate fell from 13% in 1Q11 to 9% in 2Q11, but then increased to 10% in 3Q11 and again to 16% in the most recent quarter.

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February 14, 2012 | Adoption, mobile banking, mobile enrollment, Research and Uncategorized | 0 Comments

Over Half a Billion Mobile Banking Users Expected Next Year

The number of mobile banking users worldwide will reach 530 million by 2013, up from just over 300 million last year, according to a new Juniper Research report.

According to Juniper’s Mobile Banking for Developed & Developing Markets report, mobile services are becoming a fundamental component of business strategies for financial institutions (FIs) as they respond to the current economic climate.

Mobile banking is particularly likely to gain impetus in Western markets, as consumers seek tighter control over their finances given uncertain economic conditions.

The report notes that the most successful mobile banking deployments will utilize all three mobile modes — client applications, text messaging and mobile web — rather than being solely app-focused.

The report also states that as banks migrate from traditional bricks-and-mortar approaches and seek competitive differentiation, mobile banking offers an opportunity for all banks to improve operational efficiencies and customer retention and acquisition as a cost-effective communication channel. Read More »

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February 13, 2012 | Adoption, Analysts, International, mobile banking and Research | 0 Comments

Mobile Banking Will Be the Dominant Customer Interaction Channel by 2015

A new report by PwC indicates that by 2015, mobile banking will overtake branch networks as the dominant channel of customers interaction for financial institutions (FIs), based on strong demand for digital banking products and consumers’ willingness to pay for them.

The PwC report, The new digital tipping point, suggests that banks are missing a vital new source of revenue growth as they have been too slow to respond to the digital innovations that have radically changed business models and redefined customer experience.  This is despite strong demand for digital banking products from consumers and the fact they are willing to pay for these.

PwC conducted research with over 3,000 banking customers across nine developed and emerging markets and found that most consumers are willing to pay up to $15 per month for mobile banking services that offer convenience and value.

The research reveals that there is customer demand for innovative mobile offerings such as social media notifications, an electronic wallet for loyalty cards and financial tools provided by banks, and that these are the products consumers are most willing to pay for.

Read More »

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February 6, 2012 | Adoption, Analysts, mobile banking and Research | 0 Comments

Mobile Banking Adoption Growing, but Hampered by Security Concerns

A rising number of consumers are embracing mobile banking, though privacy and security concern are hampering even wider growth, according to results of KPMG’s Fifth Annual Consumers and Convergence survey.

KPMG’s survey revealed increasing acceptance of mobile banking and payments:

  • 33% of U.S. consumers conducted banking transactions on a mobile device last year, compared with 19% the previous year and only 9% in KPMG’s 2008 survey.
  • Among age groups, 41% of U.S. consumers age 16-34 conducted mobile banking, compared with 25% for older adults.
  • 23% of U.S. consumers are open to using their mobile phones as a wallet, with 30% of younger adults willing to do so.

Security and privacy concerns remain major obstacles, however:

  • 39% cited security and privacy concerns as blocking their adoption of mobile banking.
  • Respondents specifically cited the potential for credit card information to be intercepted, the threat of unauthorized parties accessing personally identifiable information and even receiving unsolicited promotional material. Read More »
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February 2, 2012 | Adoption, Analysts, mobile banking, mobile banking security, Research and security | 0 Comments

Canadians Embracing Mobile Devices and Mobile Banking

A recent poll for CIBC conducted by Harris/Decima revealed strong growth in smartphone ownership and affinity for mobile banking services among Canadian consumers.

The poll found that:

  • One-third (33%) of Canadians now own a smartphone.
  • Ownership is growing across age groups –  with 51% of Canadians between the ages of 18-24, and 35% of Canadians between 45-54, saying they own a smartphone.
  • Among all smartphone owners, one-quarter (25%) have used mobile banking.
  • About 1 in 5 Canadians (21%) who own a smartphone believe it will replace their computer in the next couple of years.

Younger Canadians are leading the country when it comes to mobile banking: among 25-34 year olds who own a smartphone, 36% have used mobile banking, and more than one-quarter (28%) believe their smartphone will replace their personal computer sometime in the next couple of years.

These results are consistent with data cited in recent MobileFI blog posts, which showed strong proclivity for mobile banking among Generation Y consumers in America and the United Kingdom.

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January 30, 2012 | Adoption, Analysts, International, mobile banking and Research | 0 Comments
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