Our clients have varied opinions about how to proceed and compete with channel strategies going forward. However, they tend to agree on one thing: they need a next-generation mobile banking strategy. Following are the issues on their radar screen:
Americans may very well be addicted to their smartphones. In a recent study by Lookout, 58 percent of adults said they do not go one hour without checking their device. These same people are most likely part of the 86 percent of online adults who are engaging with social media (Forrester), and the 48 percent using mobile banking from their smartphone (Federal Reserve). Additionally, there has been a 31-percent year over year increase in financial customers visiting leading social media sites (comScore). Given the links between smartphones, mobile banking and social media, institutions are investigating:
- Shared login among social media sites and online and mobile banking
- Targeting products based on smartphone browsing habits
- Location-based offers that can also be shared with others via social media
- Alerts that can come via social medias private messaging
- Facilitating payments via social media
Technology Triple Play
A whopping 87 percent of the U.S. adult population has a mobile phone, and 52 percent of them are Internet-enabled smartphones, according to a recent Federal Reserve study. Right now, out of habit perhaps, most smartphone owners still use their Internet-enabled device more like a hand-held computer, logging in to their institutions online banking site.
But this is changing. As banks improve mobile browsers, apps and SMS texting capabilities, smartphone owners are rapidly adopting these technologies.
If your current mobile banking strategy doesnt include all three, then certainly your next generation should. Which of the technology triplets should be top priority is up for discussion. Mobile browsers are currently the most common and easiest to deploy. However, we are increasingly in an app for that world and consumers love the features, functionality and fun associated with apps. At the largest institutions, consumers choose apps and SMS texting more than browsers.
When consumers are on the go they use their smartphones. But when they are in layback or leisure mode, they enjoy the slightly larger screens on their tablet devices. About half of tablet owners say they have used their device for mobile banking in the last 90 days, and one-third say theyve used it for mobile banking in the past week (Javelin).
Tablet use is going to soar, as more households eliminate their tower PCs and laptops. In the first quarter of 2013, U.S. tablet shipments hit 49.2 million, setting the stage for nearly 200 million by year end. By 2017, analysts expect U.S. tablet shipments to reach a whopping 424.9 million, with Android, iOS and Windows the dominant platforms.
As banking on tablets becomes more popular, consumers will expect a seamless mobile banking experience regardless of the device they are using. This includes:
- The full functionality of traditional online banking, including remote deposit and payments
- The ability to interact with a banking professional via web conferencing
The majority (88%) of global financial executives believe the mobile channel will be the next big point of financial services fraud exposure (Aite Group). And its true that the number of malware issues on mobile devices is skyrocketing. A recent study shows an increase of 160 percent to more than 65,000 attacks in the last year alone (NQ Mobile).
Consumers also fear fraud. Nearly half (49%) of Americans who dont use mobile banking say its because they are concerned about the security of the technology (Federal Reserve). Yet consumers are definitely part of the problem.
- 62 percent of U.S. adults fail to password-protect their smartphone home screen (Javelin)
- 32 percent save login information on their device (Javelin)
- Many devices have obsolete malware or none at all (NQ Mobile)
Ultimately, the best way to keep fraud out of the mobile banking system is through stringent preventative measures, including:
- Rigorous pre-launch, cross-channel risk assessments
- Built in contingencies, such ways to remotely deactivate infected apps
- Consumer education campaigns focused on mobile security and fraud prevention
Your mobile banking strategy can be a powerful way to differentiate your businesses, attract new consumers, and keep existing ones. So, while youre checking the box on these significant next-generation issues, be sure to seek out the brand-specific touches that will make your offering unique.