The number of mobile banking users globally is forecast to double to 1.8 billion, over 25 per cent of the world’s population, in the next four years, according to research by KPMG using primary survey data supplied by UBS Evidence Lab.
The Global Mobile Banking Report, finds that while mobile is already the largest banking channel by volume of transactions, its adoption by new customers is now entering an exceptionally rapid phase. It also suggests that mobile banking and payment systems are increasingly being integrated with other technologies, driving an era of ‘Open Banking’.
The report goes on to point out that banks that do not implement clear mobile banking strategies will lose out to competitors and in the short-term lose customers and cross-sell opportunities.
In the long-term, the report suggests that as mobile banking technology is driving an area of ‘Open Banking’, where consumers can bank within context, across a variety of channels, operating systems and devices, including phones, tablets and wearables. For example, as a consumer holds-up their phone to a television in a store, an augmented reality app can recognise it and provide information including reviews and credit options.
The report highlights three key areas for banks to focus on in order to take advantage of the surge in mobile banking and therefore prepare for the ‘Open Banking’ era:
The first is to expand mobile banking services. They should explore the potential of value added services and become more personalised.
Banks also need to be more open by allowing third-party developers and investing in start-ups and incubators.
The final key area is security. “Innovation must be underpinned by rock-solid security.” Forty per cent of consumers, cited concerns about entering card details in mobile devices, and the possibility of losing a handset ranks highly among the list of worries.
“Banks must adapt or die. Mobile banking is clearly supplanting all other channels as the main portal between the bank and the consumer. Many banks have already risen to the challenge and invested in new infrastructure and pioneering initiatives, but others must follow suit and commit to building both immediate propositions and on-going capability to keep up with the pace of change,” said David Hodgkinson, KPMG’s UK digital and mobile banking lead and the report’s author.
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