The future of mobile banking looks bright as far as consumers are concerned, writes Marwan Elnakat, e-banking and e-commerce security solutions director at Gemalto.
Millennials are increasingly opting for online and mobile banking options over visiting local branches, which will soon significantly reshape the way banks do business. Due to the availability of numerous digital platforms such as smartphones, tablets, and mobile applications – customers, especially millennials, live in a world of heightened expectations and options.
Having real-time mobile access to financial information such as account balance, charges, money transfers and statements has become a baseline expectation among millennials today. With such a large push towards digital banking, it’s vital for banks and other financial institutions to invest in strengthening their digital presence, to capture and retain business from digitally savvy young people.
With the rise in popularity of digital banking, the use of mobile devices for banking is also rising and is at an all-time high and is only expected to grow. According to Juniper Research, in the MEA region, the value of online banking transactions will reach $1,3-billion in 2017 and will hit over $2-billion by 2020. Financial institutions and banks around the world, with the Middle East region being no exception, are seeking to remain competitive by offering mobile access to their customers.
Ultimately, banks are looking to retain and acquire customers – and it all boils down to strong brand recognition and trust. A key way of attaining this objective is by developing an interactive mobile application, which allows banks to offer extra and enhanced services to their customers, particularly millennials – who are increasingly looking at quicker and easier banking solutions.
Banks which do not offer a mobile app are at risk of losing current and potential clients. Including features in mobile apps which customers classify as ‘nice-to-have’, such as payment alerts, locating nearest ATMs, just to name a couple, will help banks stay ahead of the mobile game.
Listening is also key. Banks that conduct ongoing surveys to understand the needs of specific customers and accordingly revamp their service offering understandably have a more loyal customer base. Millennials have a voice and want to be heard; proactively tailoring solutions to meet this generation’s unique requirements is a must.
Many banks realise the value of mobile banking – it not only brings Generation Y on side, but also provides banks with avenues and opportunities to reach remote locations, focus on new markets, to innovate, to overcome infrastructure limitations and improve efficiencies. However, with great opportunity comes great risk. These risks come in the form of malware, corrupt apps, flawed authentication, lost or stolen devices – to name just a few.
Convenient security is paramount to a user-friendly and safe mobile banking experience. So far, banks have been deploying one authentication method for all customers. However, times have changed and each individual has a unique set of requirements. Banks must adopt multi form factors as part of their authentication strategy including not only mobile One-Time-Password but also biometric authentication through facial recognition, finger print or voice recognition- so customers can select the authentication method most suited to their needs and way of life.
According to a recent end user lab study conducted by Gemalto a few months ago, majority of consumers trust biometric solutions over PIN codes due to their perceived superior convenience. Banks can also use dynamic fraud manager systems that integrate risk-based authentication and real-time monitoring to achieve fraud prevention, alerting customers to any suspicious transactions on their account.
While there is no doubt that secure mobile banking has a key role to play in today’s day and age, bank branches still have their place in customer service. Mobile banking has become the first point-of-contact with the customer, but it does not replace traditional channels. If anything, branches have become resolution centers for technical glitches. In many instances, end users still call the branch to speak to bankers, experts or relationship managers.
In the coming years, mobile use will become the epicenter of digital banking as technology improves and smartphones and tablets become even more widespread. Banks will adopt an omni-channel strategy where all channels coexist within the ecosystem, effectively reaching and managing millennial customers. The key change will be that mobile banking will take centre stage – delivering financial services and acting as a catalyst for other channels.