Mobile and online banking services are hot, and several banks have been jumping in, developing new and better apps for mobile phones and tablets. Bank of America Corp (NYSE:BAC), a trailblazer when it comes to mobile and tablet banking, found out just how popular these services are when a service outage earlier this month sparked outrage among users — many of whom took to social media sites to vent their anger.
Despite the gains made by banks like B of A, customers are thirsting for more mobile services, and banks may be falling behind in some key areas: providing apps that give consumers the services they consider the most important, and developing these desired apps specifically for smartphones.
Customers find banking apps lacking
A recent study found that banking apps are woefully deficient when it comes to providing the types of services consumers crave. One of the main issues for customers is a lack of communication from their bank regarding the status of their accounts.
Almost two-thirds of those surveyed felt that their bank should notify them when their balances were low, and 70% were adamant that such a notice would have saved them an overdraft fee in the past. Users in the 18 to 24 age group were even more critical of this lack of communication on the part of their bank, with 73% saying that it is the bank’s responsibility to supply them with this type of information.
Banks are responding, slowly
Mobile bill payment is another sought-after feature, and more than half of respondents considered this very important. On this score, at least, banks are making an effort to please. B of A, JPMorgan Chase & Co. (NYSE:JPM), Wells Fargo & Company (NYSE:WFC), First Niagara Financial Group Inc. (NASDAQ:FNFG), and First Financial Bancorp (NASDAQ:FFBC) all currently offer this service, and U.S. Bancorp (NYSE:USB) plans to roll out a mobile bill payment option next month. Except for First Niagara, which will offer the service later this year, all of these banks also offer apps for mobile check deposit, another feature coveted by customers.
Smartphones: The future of mobile?
The biggest wave breaking on the shores of mobile banking involves smartphones. A recent study by Forrester Research reveals that 84% of U.S. adults who use the Internet on a daily basis now own smartphones. By 2016, the company expects more than 200 million people to have these devices — more than half the country’s total population.
That’s a lot of smartphones, and people want to use them to perform banking chores. A survey of smartphone and tablet users last October showed that over 70% of respondents plan to use their devices to do their banking. While the bigger banks have apps for smartphones that perform basic banking functions, some analysts note that more creativity is required to keep customers happy.
For example, a recent American Banker opinion piece suggested that apps could be used to enable customers to apply for credit cards or mortgages. This idea is already in the works — but for ATMs, not smartphones. But these new ATMs are envisioned as adjuncts to teller service, not as a mobile banking feature. However, as the author suggests, a useful app could let consumers pre-qualify for such financial products.