Mobile Banking is becoming more and more utilized among banking customers. This banking trend is moving along hand-in-hand with the increased adoption of smart phones and tablets, especially among the younger generations. A study conducted by the Federal Reserve last year found that nearly 21 percent of mobile users have used mobile banking in the past 12 months, and when adding in users who mentioned they would adopt mobile banking at some point, this number increases to 42 percent. Breaking these numbers down by age, the study found that the younger generation of banking customers (aged 18 to 29) accounted for 44 percent of the mobile banking users (this 18 to 29 age group only accounts for 22 percent of the adult population, so essentially they are twice as likely to use mobile banking than those in the older age groups). According to the Pew Research Center, the number of cell phone users that use their phone to check their bank account has drastically increased from 18 percent to 29 percent between the years 2011 and 2012 (note that mobile banking usage figures nearly double when looking at smart phone users only).
As mobile banking usage has radically increased, it has risen as more of an additional customer expectation that compliments other banking channels rather than as a channel replacement in itself (see lasts month’s blog post on how brick and mortar locations are unlikely to go anywhere anytime soon). The same study conducted by the Federal Reserve found that overwhelmingly most people (90 percent) used mobile banking to check their account balance or recent transactions and second to that (downloading the application for mobile banking aside), 40 percent of users used mobile banking to transfer money between their accounts. This points to the fact that mobile bank users are likely satisfying their other banking demands through the use of other channels (such as the branch lobby or drive-thru). Much of the research we’ve conducted here at RMS has found the same with regard to channel preference – with banking customers looking to more than one channel (it is also very common to see customers place a heavy importance on employee interactions despite preferring other channels). To support this idea that mobile banking may act as merely one channel that helps bring everything together in a multi-channel environment, a study conducted by Forrester Research found that more than two-thirds of adults use more than one banking channel.
The banking industry is highly competitive with customer offerings and mobile banking is certainly not an exception. What this means for financial institutions is that it is rapidly becoming a necessity to not only deliver mobile banking, but to ensure their mobile interface is customer/member-friendly, intuitive and fully optimized. As someone who has used mobile banking for a handful of financial institutions, it’s easy to see that the ease of use and functionality of mobile banking can vary greatly – especially when you look at the mobile banking interfaces for both an actual application as well as the mobile version of the financial institution’s website. To put a customer research spin on this (as we usually do at the Research Bunker), it is going to be essential for financial institutions as well as mobile banking application providers to conduct usability testing and explore customer expectations and insights for mobile banking to stay ahead of the curve.
If you have any thoughts or differing opinions on the role mobile banking is going to play in the future, please feel free to comment below.