Dorota Jasińska
Andrzej Puczyk
In a digital world driven by customer convenience, it’s natural that financial institutions try to provide the best solutions for their clients. One of them is the option to use mobile banking as an alternative to a web-based service. With the rising competition, such a feature is a must to keep up with the innovation. So, what are the benefits of mobile banking for banks and customers?
Mobile banking in numbers
There’s no doubt the use of mobile banking is increasing. According to the statistics, 73% of all bank account holders in the UK used mobile banking in the first quarter of 2024. In the US, there’s a similar number of mobile banking users. As per MX’s survey, 68% of all US consumers use a mobile banking app to view or manage their accounts. Moreover, 72% of US consumers claimed they prefer to use mobile banking to manage their finances.
What’s interesting, according to MX’s survey, 8% of US consumers claim to keep their oldest financial accounts because of a good online or mobile experience. Also, a mobile banking app is a reason for 23% of respondents to choose a financial provider in an MX survey. 5% of USA respondents claimed to have closed a bank account due to a poor mobile banking experience.
These numbers suggest that mobile banking services are a way of creating a good relationship with customers. The vast majority of clients seem to use mobile banking on an everyday basis. In the US, 45% of consumers use mobile banking apps to perform finance-related tasks at least once a day. As Millennials are the most active group, the number of users jumps to 85% for those who use mobile banking at least weekly.
Exploring the benefits of mobile banking
There’s no doubt that a mobile app can influence the relationship between the bank and the consumer. After all, they’re supposed to make the client’s life easier. That’s why a bank’s mobile app seems to be a feature clients expect from their banks. So, what are the benefits of mobile banking to banks?
Mobile banking and B2B transactions
Nowadays, the methods of B2B payments are changing, and more and more people use mobile devices for such transactions. Merchants especially can benefit from mobile B2B transactions that can be handled on the phone anywhere and within a few taps. Easy access to mobile POS and online banking is a game changer for business operations.
This is why, to keep up with the competition, more and more banks offer a mobile POS in addition to a business account. Now, banks enable business owners to use mobile POS on the go and accept, authorize, or track payments through their mobile banking apps or mobile devices. This is an excellent option for banks to gain more business clients.
Boosted service efficiency
Mobile banking is a way of reducing in-person services performed by bank staff. Customers can handle their transactions without the need to visit a bank’s branch. They can handle basic financial matters, and for example:
- Transfer funds;
- Pay bills;
- Order a debit card;
- Automate bill payments;
- Check account balances;
- Check account history.
As a result, branch traffic is reduced, and many consumers can quickly deal with their financial operations.
Moreover, mobile device data can be used to analyze and understand customer behavior. A good understanding of customers’ actions within an app can lead to the optimization of financial services and improved experience. It also allows for finding pain points and missing features that would keep customers self-sufficient regarding financial services within the app.
Lower infrastructure costs
As mentioned before, fewer customers visiting bank branches can lower the need for physical offices, maintenance, and staff costs. People can deal with their financial services over a mobile device instead of in-person assistance in a bank, so banks close their branches and keep the key ones.
Banks can also leverage modern technology, such as cloud computing, to store data and run mobile applications, reducing the cost of on-site servers. Cloud solutions lower IT costs compared to traditional IT infrastructure, as such services often offer lower upfront costs and ongoing maintenance.
Real-time financial insights
Another great advantage of mobile banking is the access to financial insights from customers. Banks can, for example:
- Get data from mobile transactions;
- Analyze customer spending habits;
- Analyze the cash flow;
- Understand customers’ needs;
- Propose tailored offers.
Such information can bring valuable insights into the customers and their needs regarding potential financial services, such as loans or reaching saving goals.
Analyzing the data in real-time helps to understand the customer’s needs and provide a tailored product offer, such as insurance after a purchase of a holiday trip. Moreover, mobile apps allow instant feedback to be collected through surveys or data concerning app usage.
Secure transactions
Mobile phones have changed the game by adding another security layer to banking services and offering additional safety features. Many apps use multi-factor authentication (MFA), like biometric authentication or numeric code, to confirm the customer’s identity. There are many ways to add extra authentication layers through a smartphone, and banks should use them to ensure consumer safety and data protection.
Moreover, mobile banking apps are capable of encrypting one’s sensitive data, such as account numbers, account credentials, and passwords. This way, even when a data breach occurs, the data is protected from unauthorized use. Consumers can receive alerts whenever a suspicious activity happens.
Simplified global payments
Mobile banking simplifies the use of open banking solutions. Through APIs, banks can more easily connect with third-party payment providers. Open banking facilitates access to international payment processors and streamlines cross-border payments for trading convenience.
Mobile banking also allows for real-time cross-border financial transactions and settlements. It enables the use of digital wallets, different currencies within one account, and other payment methods available abroad in a selected currency and at a good currency rate.
Integrations with accounting software
Another feature banks offer in addition to their mobile services for startups, individual entrepreneurs, and companies is integration with accounting apps or software. For example, business owners can create a business account with accounting services included, allowing them to issue an invoice without the need to involve an accountant.
Nowadays, accounting data can be exchanged with an accountant or managed easily through a mobile device. Entrepreneurs can easily track their business cash flow within the app. Such integration can greatly simplify the accounting process and management for businesses.
Tailored financial solutions based on customer behavior
The customer data gathered from mobile devices make it possible to offer tailored solutions for customers, often in real time. Based on their behavior in the app, banks can leverage the data to offer a special product or service adjusted to the user’s needs. Such proactive recommendations may positively influence customer satisfaction and loyalty.
After the analysis of customer data and behavior, banks can understand one’s spending habits, financial goals and needs. This way, the bank can:
- Prepare a dedicated loan offer;
- Suggest an investment strategy;
- Help reach saving goals;
- Give financial advice and tips.
All these financial solutions can drive sales in the process.
Expanded market reach
One of the reasons why mobile banking is so popular is due to its accessibility. People can manage their accounts anywhere and anytime. They no longer need to visit a bank’s branch to deal with financial matters. This allows banks to reach a wider customer base as they can bank on their own schedule.
In addition, mobile banking applications are great tools for targeted marketing. They can utilize push notifications, in-app messages, and other ways to present special offers to their customers. The campaigns can reach more people easily and instantly.
Faster product rollout
Mobile banking can speed up the process of product rollout. Thanks to streamlined development, mobile app development process can be faster and more agile than traditional methods. This leads to shorter way to testing and iterating the product.
Banks can also easily introduce product updates within a banking app. It’s also possible to introduce new functionalities or product features in an app. However, it’s important to remember that the speed of launching new products depends on many factors.
Environmental impact
As it was already mentioned, mobile banking contributes to lowering the need of physical offices. This reduces the use of electricity and water. It also means people don’t need to commute to the office or the branch, so the carbon footprint is also lowered.
Moreover, mobile baking makes it possible to reduce paper usage. Consumers can accept terms and conditions online, without having to sign printed agreements. The communication with the user can also be handled within the app instead of via post.
Stay ahead with Neontri’s mobile banking expertise
Neontri is a reliable partner of major Polish banks with over 10 years of experience in fintech and banking software development services. Our engineers have extensive experience and expertise in integrating international payment processes and systems. We know the dynamics of the banking industry and can help navigate the complexities of modern banking.
We have experience in mobile app native development, cloud services, third party integrations, custom backend development, data management and AI solutions. We’ve developed the world’s best mobile banking app for the biggest bank in Central Eastern Europe. Moreover, our developers are Google-certified.
Our developers have over 15 years of experience in fintech, big data, banking and custom software solutions. They prepared the infrastructure for big data management and analysis to draw conclusions about consumer needs and problems. We’ve enabled tracking of possible pain points of users by introducing an innovative big data platform.
Our team offers end-to-end customized solutions with ongoing support and can deliver a mobile banking application for corporate-level clients in just a few months. Our professionals can also help update and innovate a product according to the clients’ and their customers’ needs. We offer software development with maintenance and refactoring, depending on your requirements.
Conclusion
Mobile banking offers a lot of benefits for both banks and their customers, and it’s also a potent tool for analysis and understanding of consumer needs. Mobile banking apps increase customer satisfaction and loyalty thanks to their accessibility and possibility to deal with financial matters on one’s own. Such solution can also transfer traffic from web servers and physical branches to mobile, cloud-based applications.
Moreover, mobile banking can be a source of information and data from the users. This way banks can analyze the possible needs and options for further service development to keep users satisfied and engaged. Mobile banking also enhances the security of banking operations and people can feel instantly secure thanks to multi-factor authentication.
Mobile apps for banks also positively influence the environment by minimizing paper usage for documents or the need to commute to the bank’s branch. Looking at all these benefits, banks can easily attract new customers, increase engagement with existing ones, and offer new, innovative solutions.
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