As Online Banking Acceptance Grows Is Mobile Banking Reaching the Tipping Point With Millenials?

A new survey by the American Bankers Association (ABA) found that for the fourth year in a row, consumers named the Internet as their favorite way of conducting banking business, with 39 percent of respondents saying it is the method they ‘use most often to manage (their) bank account(s).’  The second most popular way to bank – visiting a branch – continued its downward trend to 18 percent from 30 percent in 2008.

In addition, this year’s survey showed a sharp increase in the popularity of mobile banking, driven mainly by customers in the 18 to 34-year-old age group. Use of the mobile channel by millennials escalated from 4 percent in 2010 to 15 percent this year. Conversely, the use of branches by this age group during the four-year period dropped from 20 percent to 11 percent, with ATM use also dropping from 32 percent to 14 percent. Overall, mobile banking is now preferred by six percent of customers, a 100 percent increase from 2010.

The distribution of primary channel use this year was as follows:

• Internet Banking (laptop or PC) – 39% (36% in 2010)
• Branches – 18% (25% in 2010)
• ATMs – 12% (15% in 2010)
• Mail – 8% (8% in 2010)
• Telephone – 9% (6% in 2010)
• Mobile (cell phone, Blackberry, PDA, I-Pad, etc.) – 6% (3% in 2010)

• Establishing mobile banking as useful
• Providing access to mobile banking through all devices
• Helping consumers overcome security concerns
• Fostering familiarity for a natural transition across channels
• Making mobile banking easy to use

“Financial institutions have rushed to offer mobile banking during the last few years, and many now realize that driving adoption is not just a ‘build it and they will come’ proposition,” said Kelly Rodriguez, vice president, Strategy and Business Development, Digital Channels, Fiserv. “In order to maximize return on investment, financial institutions need to engage both their staff and customers. This requires a proactive strategy for delivering mobile financial services and educating potential users on the benefits.”