The banking sector has undergone a huge transformation in the last couple of years. When the ATMs came, they changed the way banking was done in most financial institutions.
You can now get most of the banking services from an ATM. People are now shifting away from the ATMs for the more versatile and personal mobile banking. Mobile banking is mainly done through app services that allow people to access their accounts for inquiries, checking balances, generating statements, and making direct purchases via mobile phones.
Why mobile banking?
Most banks have reported steady growth in domestic deposits even as they close branches that are considered less profitable. Banks have indicated that most banking clients are using mobile banking more frequently compared to the conventional banking system.
Clients visiting banking halls report a lot of dissatisfaction for making long queues to get services they want. But mobile banks make users feel like they have the whole bank at their fingertips. They can make inquiries and get instant answers relaxing at home, on the train traveling to work, and at work. So good is mobile banking that people can now access their accounts even at night and even weekends.
Most banks have developed either online portals and/or mobile apps that bring banking services only a click away. They are now going a step further to provide clients with more products to make them feel more engaged. For example, the applications can help to alert clients when the balances get too low.
What is the future of mobile banking?
In the United States, over 81% of bank clients use mobile applications when checking balances while 49% use their phones when transferring funds. 48% and 38% also use their mobiles banking applications to pay bills and check deposits respectively. With more millennials now becoming banking clients, these figures are expected to increase.
Recent studies indicate that most banks are committed to investing in mobile banking in the coming years. In their studies, CEB Tower research group predicted the mobile banking space to grow rapidly at 14.5% by close of 2017. Some of the top technologies that have leveraged this development include the Google Wallet and Apple Pay.
Note that these developments are not just a threat to the traditional banking services. They are also a threat to the growth and success of other financial services such as VISA and MasterCard.
The final take
Mobile banking has demonstrated its huge potential to become the next frontier in the financial sector. As banks continue closing conventional branches and more developers joining the mobile computing niche, growth is expected to be faster in the coming years.
The partnership being witnessed between tech companies and banks in the fintech sector is likely to further accelerate the mobile banking sector.