WASHINGTON — Consumers love banking on the go.
That's the main takeaway from a recent Federal Reserve Board report that found the number of U.S. consumers using mobile phones to access their financial accounts rose by five percentage points last year.
And that means one in three mobile phone users access their financial accounts through their mobile device.
As of December 2013, 33% of all mobile phone users had used mobile banking in the past 12 months, up from 28% in December 2012. Also, 51% of smartphone users had used mobile banking in the past 12 months, up from 48%.
The report leads one credit union, which has just launched a new mobile app, to say credit unions must think ahead and cannot afford to be fast followers in this space.
"The innovation cycle is much shorter today," said Ian Harper, EVP and CIO at the $17 billion-asset Pentagon FCU in Alexandria, Va. "The Fed report underscores that we have reached a tipping point. The speed with which mobile financial services is coming to every corner of the consumer population is impressive. Credit unions need to pay attention not only to mobile adoption, but the speed of adoption within all fields of membership — or lose an opportunity to deepen relationships with members."
Harper said the Fed data suggests it is not just the availability of smartphones that is driving the use of mobile in banking.
"It is primarily being driven by the convenience and the ability for members to be in command of their financial future throughout the day, wherever they may be," he said. "Financial services are relevant even when the member is not at home or in a branch."
The Fed report also showed that consumers most frequently used their phones to review account balances, monitor recent transactions and transfer money between accounts. In addition, 38% of mobile banking users deposited a paper check with their phone's camera in 2013.
The underbanked, as well, were frequent users of mobile financial services: 39% of underbanked consumers with mobile phones used mobile banking last year.
Consumer concerns over the security of mobile devices, however, continues to be a roadblock to some. The report indicates that those consumers who do not use mobile banking are becoming more skeptical of the benefit of mobile banking and the level of security associated with the technology. Well over half of mobile phone owners who do not currently use mobile banking say they have no interest in using the technology.
Nevertheless, Harper said PenFed believes that mobile will "redefine the face of banking" across all consumer types.
"The Fed data shows what we already have seen for years, that people of every demographic, including all ages and walks of life, are participating in the mobile shift."
The survey was conducted on behalf of the Federal Reserve by GfK, an online consumer research firm. Data collection began December 6, 2013, and concluded on December 23, 2013. More than 2,600 respondents completed the survey.
