Mobile is heaviest used banking channel as transactions multiply: report
Mobile is now the most heavily used banking channel, with the average user accessing mobile banking 8.4 times within a 30-day period, according to a new report from Fiserv.
There has been a significant increase in the number of banking customers using mobile for bill payments, helping driving the shift in mobile banking’s use case from pure information gathering to transaction-based. Additionally, Fiserv found that banking customers are embracing biometric authentication.
“We’ve anticipated for several years now that as mobile banking matured it would shift from being a channel that people use for getting information – primarily checking their balances – to a channel that people use for transactions,” said Steve Shaw, vice president, strategic marketing for digital banking at Fiserv.
“We saw a sizable increase in bill payments through mobile banking in the past year, which shows that theory is playing out,” he said. “This shift is happening because mobile banking technology itself is more robust, and because people’s comfort level with the service has increased.
“They may not have been comfortable making a bill payment from their phone a few years ago, but now that they have seen how it works and have confidence that mobile banking is secure, people are much more apt to make payments and transfer funds.”
Fiserv’s quarterly Expectations & Experiences consumer trends report is based on a survey of more than 3,000 U.S. banking consumers.
Mobile banking matures
As mobile banking continues to gain steam, it is shifting from being a channel primarily used to access information to a transactional channel.
The survey found that 40 percent of consumers report having using mobile banking within the past 30 days, a number that jumps to 77 percent of early millennials. Of this 40 percent, 51 percent said they use the service more now than a year ago.
Among users of mobile bill pay, 47 percent use it more now than a year ago.
Changes in behavior were more pronounced among early millennials who use mobile banking or bill pay, with 69 percent saying they are using mobile banking more compared with a year ago and 59 percent using mobile bill payment more.
Among mobile banking users, 47 percent used the service to pay for a product or service in the past month, 45 percent transferred money between accounts at the same financial organization and 37 percent deposited a check.
Mobile banking is now the most heavily used banking channel while online banking comes in second with customers accessing it 8.1 times on average within a 30-day period.
Alleviating security concerns
The survey also found that biometric security shows promise, with 62 percent saying that would feel secure using fingerprint technology to confirm their identity compared with 41 percent feeling secure using a password.
“It was somewhat surprising to see fingerprint authentication perceived so favorably by consumers,” Mr. Shaw said. “It shows that biometric authentication methods are being accepted and are seen as more secure than scary.
“Security concerns have historically been one of the main impediments to mobile banking and payments growth,” he said. “It appears consumers are becoming more comfortable with mobile banking and newer authentication methods may help alleviate security concerns and get consumers over the adoption hurdle.”
The adoption of mobile bill payments bodes well for further payments adoption. However, there are still challenges.
For example, 41 percent of consumers do not know if their financial institution offers person-to-person payments.
Additionally, 24 percent said they do not use P2P payments because they do not know how they work while 20 percent said the same for mobile banking, 15 percent for electronic bills and 14 percent for electronic bill pay.
These findings point to the need for financial institutions to leverage awareness and education to boost their mobile banking offerings.
Banks should also consider adopting capabilities that consumers are interested in, such as real-time transactions. The survey found that 40 percent early millennials who do not use P2P payment services say the ability to transfer funds to people in real-time would increase their use of these services.
“Forty percent of U.S. households are using mobile banking, so there is still significant room to add net new users of the service,” Mr. Shaw said. “We also anticipate that we’ll see more ‘mobile-only’ consumers – people who access their financial accounts only from a mobile device, and will therefore use the service more.
“The addition of more robust functionality and people’s growing comfort with the service will also contribute to growing use overall,” he said. “It’s important for financial institutions to drive adoption and usage of mobile banking and payments, as it has proven to drive higher levels of engagement and profitability.”