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Innovations in Mobile Banking


Lauren Wilson - September 6, 2018 - 0 comments

Innovations in Mobile Banking

In 2014, the number of mobile users in the US surpassed desktop users.  In Q1 2018, Android users had the choice between 3.8 million apps on Google Play.  Apple’s App Store users had a choice between 2 million available apps, and others had a choice of an additional 1.3 million apps available across the Windows Store, Amazon Appstore, and BlackBerry World.

A recent survey by Citi found that mobile banking apps are some of the most used, with 31% of American consumers using them the most. Second only to social media at 55%. The increased adoption of mobile banking apps is driving industry trends, with 91% of mobile banking users preferring to use them over visiting a branch in person. For Millenials, 68% see mobile banking on their smartphone replacing their wallets. The usage increase is substantial with 46% of consumers using their mobile bank app more in the last year. For Millennials, this number jumps to 62%. On average, 81% are using mobile banking nine days a month.

With the growing volume of options available for consumers, banks and credit unions are looking to innovate to improve their competitiveness and customer experience. Here are a few areas of innovation in mobile banking:

Biometric Authentication

The banking industry is at the front of security innovation through biometric authentication. From fingerprint and retina scans to now facial recognition, there is a continued growth in the of solutions appearing.

In the US, face recognition has been first made available for commercial use in the U.S. and Canada by BMO Financial Group (BMO) through Identity Check Mobile.  Soft launch participants backed the option with 75% agreeing that biometrics were easier to use than passwords and 90% anticipating to use biometrics for online payment in the future.

In the retail banking space, facial recognition biometrics has been coined as ‘selfie-banking’ or ‘selfie-payments’. Not only are these ‘selfies’ seen as a reliable security solution but also a cool feature. When marketed correctly they have proven to increase enrollments in other roll-outs.  

Cardless Cash Access

Cardless cash provides users with a unique PIN code to enter into an ATM, enabling them to withdraw cash when they don’t have their debit card. Codes are generated from secure apps on their mobile phone, enabling access to a digital wallet. For clients, it provides an option to leave the card behind and travel light for trips to the beach or an amusement park. It also provides options for if/when they forget their wallet at home, or in case of emergency. The popularity of the solution proves that when given the choice, consumers will choose to carry their mobile phones over their wallets.

Cardless cash also includes some enhanced security over debit cards. The app provides you with one-time use PIN codes, rather than using the same code each time. For more enhanced security, these PIN codes also expire if not used within the specified time limit.

Social Media Banking

Social media has evolved into an extremely valuable and important channel in the banking industry. As a preferred platform for many customers for service and support, industry marketers have been continually improving their digital strategies. These strategies prioritize both meeting and exceeding the customer demand for experience, and to support key marketing messages.

However, social media is ready to play a greater role. With the increase in popularity of peer-to-peer lending and crowdfunding, social networks are already being leveraged for finances. As non-bank companies continue to enter the payments industry the speculation continues to grow as to when top social media players will join in. This threat brings an opportunity for banks and credit unions to seek out innovative options to connect their services through social channels. 

The world-wide app market is forecasted to hit revenues of 188.9 billion by 2020. This market growth combined with ongoing consumer demand will continue to attract entrants and innovation in mobile, across all industries. What are you doing to stay competitive? Share your thoughts by getting in touch at support@myvoleo.com.

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