What's working in mobile banking and why

One of the recent focuses of our quarterly global research has been on mobile banking and its growth and adoption. We utilise our extensive global network of mobile users to analyse their online usage and surfing habits and to gain an insight into their attitudes towards the online world via the mobile device. In October 2013, we surveyed 17,000 consumers across 22 countries on their attitudes to mobile banking and payments.  Amongst working adults over a quarter (26%) were using their phones for some form of financial or banking transaction, with nearly a fifth (16%) intending to’ try’ mobile banking. But it was those without bank accounts, ironically, that are fuelling the growth of mobile payments – a higher percentage than those with bank accounts.

This growth seemed to have been fuelled by the “Under Banked” - those without any form of bank account – and we predicted that the next phase of growth for mobile banking and payments would be among those with bank accounts who are not yet using their mobiles for banking (44%).

In our most recent report on mobile banking it was revealed that one of the other key drivers to widespread adoption, security fear, is not a threat any more and fears seem to have been allayed; only 19% of those surveyed said they wouldn’t mobile bank due to security fears compared to 34% the year previously. It is more to do with a general apathy and lack of awareness. In the latest report, we surveyed 6,000 adults in 20 countries, and found that despite the overall increase in mobile banking, there is a general apathy towards adoption amongst potential users, with a third of surveyed (33%) simply not feeling that they “need” mobile banking.

Where there’s a need, there’s a need to create desire

With banking, the selling point for potential users is its practicality, its utility – but if people aren’t aware of its services and its real advantages, then there’s a real discord between need vs desire. If potential bankers don’t see the necessity in the app, then the utility of the app will have an impact on mobile advertisers. While security concerns and other anxieties will still persist, this apparent indifference among users may actually be the biggest hurdle for financial institutions to overcome.

Financial services need to think about other factors that affect responses to their campaigns as 17% feel that they need it to “be offered” from their banks. Parallel with this is consumer confusion; 11% feel mobile banking is too complicated or unreliable (11%) and many aren’t even aware if their devices can even be used to activate the service. It’s evident that there’s a huge misunderstanding surrounding such a simple service.

Right now, there's too much reliance on above-the-line activities like TV and not enough below-line interaction and customer education, particularly face-to-face. Creating a brand presence is important of course but many in the past have portrayed it as a premium service for “high end” users. That messaging needs to change! The human element of a brand is what instils trust, so it’s refreshing to see NatWest’s “My Mum’s Magic” recent campaign where mobile banking can even be ice cream money! It communicates effectively what the product is in practical terms and demonstrates its ease of use. It’s imperative that services like this are supported with clear messaging that drives customers to trained people to explain the app and its benefits.

What works in mobile baking – and why

The report also looks at the most popular banks among mobile users and Barclays was the most popular bank, followed by Lloyds in 2nd place, HSBC in 3rd place and the Royal Bank of Scotland in 4th place.

In the developing countries there’s an emergence and rising popularity of mobile-based banks, where accounts are linked to SIM cards. These mobile banks, catering specifically to the mobile-only consumer have gained widespread adoption and a rapid market share in a relatively short time. The target users are those who solely rely on their mobile phones and more often than not as the primary device for internet access as well.

Mobile banking is a growing phenomenon with huge potential for the financial industry, mobile advertisers and even the mbanking users themselves, but if financial services fail to communicate their own services, then their users will either go elsewhere or, as this report suggests, not care enough to enquire themselves. There needs to be a proactive and energetic approach to increase awareness of mbanking benefits and availability.

Dr KF Lai is CEO at global advertising network BuzzCity.