In 2015, the McKinney Global Institute declared that
"banks have three to five years to become experts digitally", or face
a sad fate similar to that of laggards in other industries. This is a powerful
and condemnatory statement. The end of 2018 is approaching and, while the
banking industry has made significant progress in navigating digital
interruptions and increasing mobility, they must maintain their pace of mobileapplication development to meet customer expectations.
With the Fitch industry turning around the established order
of mobile banking, banks are facing a unique environment full of threats and
opportunities. New technologies and the enriched functionality of mobile
applications are giving rise to consumer demand for greater flexibility and pro activity
in their financial lives.
This article will analyze how the behavior of clients is
changing with the increase of mobile banking; use of mobile banking in Canada;
barriers to adoption; challenges for banks; and the strategies that banks can
use to benefit from new technological developments in the mobile space.
The rise of mobile banking: consumer use and attitudes
Similar to mobile payments, the adoption by mobile banking
users has been gradual rather than explosive. Since the inception of mobile banking,
consumers expect their financial providers to offer the value of the customer
experience at the same pace as other mobile application services; and with high
expectations, Canadian consumers are satisfied with their bank's digital
experience.
According to the Canadian Bankers Association (CBA),
Canadian attitudes towards mobile banking and Fitch innovations are very
favorable among consumers:
In 2017, the six major Canadian banks registered 398 million
mobile banking transactions.
- · 90% of Canadians say that banks have done well to bring innovation to banking.
- · 26% of Canadians say their use of mobile banking is increasing.
Canadian customers of retail banks value the convenience of
mobile banking offers. The CBA also reports three areas of importance to
consumers:
- · 90% of Canadians value banking at a convenient time.
- · 77% of Canadians value time savings.
- · 77% of Canadians value banking from anywhere.
What is interesting is that J.D. Power states that almost
half of the customers in Canadian retail banks identify themselves as
"digital-centric" and 32% describe themselves as "digital
only" bankers. Audiences only for mobile devices are growing in Canada and
more time is being spent on mobile applications, and despite the overwhelmingly
positive comments, only 17% of Canadians are bankers for mobile devices only.
Barriers to user adoption
The dis connect between Canadian mobile time spending and
mobile-only bankers could be the result of several factors. Although consumers
are interested in more mobile banking functionality, one of the biggest
obstacles to adoption is security. Many users distrust the security of their
money and their personal information when they trust their smartphones.
However, attitudes are changing gradually. Banks have
comprehensive security systems and work 24 hours a day to protect mobile
banking customers against fraud. In fact, over the past decade, banks have
invested $ 84.5 billion in technology, which includes technology dedicated to
security measures.
Apart from security, it is possible that the low number of
bankers that only use mobile devices refers to a continuous commitment to the
cross-platform experience, or that banks have to update their mobility
potential to offer a value of customer experience beyond of what is considered
a banking standard.
The banking industry has done well to meet the standards
that Intech innovations have created. They have rotated at full speed and have
delivered well-received digital options, but the truth is that technology is
not slowing down to congratulate them and neither are users of mobile banks.
Functions, such as checking account balances and recent transactions, making
transfers, depositing checks through photographs and receiving notifications
make the banking experience more valuable; however, these mobile banking
functions are now considered a commonplace and banks must expand the limits.
Today's customers expect hyper-personalized customer trips and superior
convenience.
Challenges for banks
While the increase in mobile banking and Intech services
presents a great opportunity, banks still face a lot of challenges. There is an
understanding that the urgency of innovation is acute, however, these
impediments remain considerable barriers to change:
Bureaucracy and organizational structures: startups enjoy a
level of flexibility that large financial institutions can not
Long development cycles: many banks are still in the process
of changing processes to adopt a more agile and agile development philosophy
Legacy systems: adopting and implementing new technologies
is more difficult with long-established systems implemented
Organizational thinking: similarly, organizational thinking
should change to a more proactive, agile and agile philosophy to allow banks to
keep up with changing consumer behavior and technological advances
Perception of security: as mentioned above, banks must
continue working to build trust with consumers, particularly with new
innovations in mobile banking and other digital services
Strategies for banks to improve the services and technology of mobile banking
Banks that do not keep up to date run the risk of external
competitors capturing market share with their mobile strategies. To stay ahead
of the curve and deploy the network in evolving mobile banking and in the Intech
space, banks must focus their efforts on several essential areas.
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