Are Consumers Clamoring for Mobile Banking?
Written by Mike Perlman (contact - e-mail) -- October 17th, 2008 |
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Financial institutions are investing heavily to build technological platforms and strategic partnerships to capitalize upon the growth of the mobile banking channel. We wanted to separate the hype from the reality by exploring one fundamental question: Is there really significant consumer demand for performing banking activities on a mobile device? The results of a recent survey targeted at online bankers illustrates that the mobile market, although still in its infancy, is poised for future growth.
One of the obvious drivers of mobile banking adoption is consumers having access to the internet from their mobile device. Our research indicates that 72% of online bankers never access the internet from their mobile device (see below). Mobile internet access will undoubtedly rise, as technology advances and “smart phone” adoption (Blackberry, iPhone, etc.) proliferates; however, if almost ¾ of online bankers never access the internet from a mobile device, how many people actually utilize mobile banking services? The answer is not many, as only 5% of online bankers currently use a mobile device to check a banking account.
It is clear that mobile banking is still in its infancy, but what about future growth prospects? Our research reveals that consumers are significantly more likely to view mobile banking as “very useful” (23%) than “not at all useful” (12%) (see below). It is interesting to note that 28% of respondents currently appear to be indifferent towards mobile banking, neither citing the functionality as useful or not useful.
Many of these indifferent consumers are likely to demand mobile banking functionality once the technology and partnerships make the usability of this banking channel easier for the average consumer. One good example is a current Bank of America promotion for free mobile banking to current online customers. The messaging promotes the accessibility, convenience, and security of mobile banking.
As consumers increasingly leverage mobile devices for shopping and account service needs it is highly likely that banking will be no different in its migration towards this emerging medium.
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October 18th, 2008 at 7:46 am
There’s been lots of hype about mobile applications over the past few years, but somehow it just doesn’t take off. Besides, I’d be leery about online banking on a mobile phone. Security ain’t all that tough to crack, and its like asking for trouble. But then, I wouldn’t know, since I’ve never done it, and don’t plan to. Maybe it could be the next wave. :)
October 19th, 2008 at 2:34 pm
I believe there’s a huge market coming for, not only banks, but any company looking for expanding their services’ availability to their members. Personally, I have been a mobile-Internet user for a few months only, and I had seen and experienced the greatness of such, and no wonder companies are eager to create more content that’s cell-phone friendly. Speed is an important issue here, and I just rely on the service for quick, easily-accessible content. Finally, I would vote thumbs up for banks to invest their moola on this.
November 6th, 2008 at 2:24 pm
Interesting remarks, Lets assume that you are sitting at your home/office and you have your smart phone and your laptop in front of you. Both devices are capable of high-speed data handling. If I need to check an important transaction; which one will you pick up?
I’ll grab laptop so that I can see my transaction in bigger and better view rather than cramped looking handheld (may be psychological reasons).
Having said that - still mobile banking is going to hit big!! I guess mobile banking is going to be more successful in Developing countries like India and China. Reason- they don’t have that many laptops and broadband connectivity to fly thru web. They have cellphones - everywhere, and biggest mobile consumers in world. So to request a new checkbook - I will prefer sending an SMS or browse on handset rather than going to ATMs. The shear volume of mobile consumers will beat number of net-banking users down the line.
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