The early adoption rates for Mobile Phone Banking suggest that it is only a matter of time before mobile banking catches up with online banking as a primary means through which consumers will interact with their bank. Within countries such as the UK and the US this growth is largely currently being fuelled by sign up by owners of smartphones.
Smartphones, such as iPhones or Blackberries, may have the word “phone” in their title but they are effectively mini computers, providing users with access to the Internet and dedicated applications and the ability to send and receive e-mails. Owners of these high spec phones increasingly view their smartphone as an integral part of their life. They use their phone to check for weather and travel updates, and to book concert tickets, and to keep in touch with friends, family, and business associates through social networking sites. It’s no surprise, therefore, that they also see their smartphone as having a vital role to play in how they manage their financial affairs.
It’s important to stress that there are two distinct ways that smartphone users can use to conduct their banking. The first is to use the Internet browsing capability of their handset to navigate to their bank’s online banking site. They can then log into their online banking site using the standard security credentials that they would use if logging in from a desktop or laptop computer. The alternative is that many banks have started to offer bespoke Mobile Phone Banking applications. For example, an iPhone user might download his bank’s iPhone app and log into it using a distinct set of security credentials.
The Online Banking route:
Navigating to your bank’s online banking site, via your smartphone, can enable you to transact on your accounts via your mobile handset. However, it is not without its problems. Firstly, online banking websites are still generally configured to be viewed on a computer-sized screen and often render horribly on a smartphone-sized screen. This usability flaw means that many smartphone users give up on this route, although banks do have the ability to fix this by introducing mobile optimised stylesheets. The other problem is that smartphones often don’t have the levels of security protection that we routinely employ on our computers. The absence of anti virus software and/or firewalls could result in security compromises, although again we can probably expect better security solutions to be introduced by the smartphone industry as time progresses.
The Mobile app route:
Smartphone users will be familiar with the concept of dedicated mobile applications and most banks have either already introduced their first mobile app or are in discussions to develop mobile apps. Mobile banking apps will employ their own security credentials and most users will view them as a safe and viable option. Because they are designed specifically for the smartphone market, they should also render well on devices, leading to a good user experience.
The present and the future:
At the moment, the fledgling mobile app market is largely catering for simple transactions such as the ability to view balances and mini statements or to get a text telling you when you are nearing or entering your overdraft. However, as the market matures, we can expect banks to extend the range of functionality to include transactional capability such as the ability to make payments to third parties and to transfer funds between accounts you hold with your bank. No doubt, as with online banking, there will remain those who are concerned about security but we can expect the banking and mobile phone industries to work hard to ensure that these are overcome so that the large scale customer demand can be met.