Mobile banking is rapidly moving to near-universal availability, but customer uptake rates remain relatively low, according to a newly released survey from the Federal Reserve Banks of Atlanta, Boston, Dallas, Minneapolis and Richmond. Just four percent of financial institutions report that more than half of their retail customers are enrolled and active users, while 80 percent report that less than one customer in five is an active mobile banking user.
Seven in ten respondents said that lack of customer awareness and security concerns from customers were the biggest barriers to customer uptake. Fifty-nine percent said their customers’ banking needs were already being met through other channels.
This has not stopped banks and credit unions of all sizes from rolling out mobile banking; 78 percent offered it in 2014, when the survey was conducted, and an additional 16 percent planned to launch mobile offerings in the next one to two years. Across the industry, mobile banking features universally include balance checks, funds transfers, transaction histories, ATM and branch locators and bill pay.
Mobile banking offerings are being driven by the need to attract and retain customers and compete with other institutions, the survey found. Of institutions already deploying mobile banking, 82 percent said it had helped them retain customers and 48 percent said it improved operational efficiency. Eight percent overall said they had seen “no benefits.”
With mobile banking becoming near-universal, institutions are turning to mobile payments. While just 10 percent said they offered mobile payments, an additional 47 percent said they would in the next year or two. Eight in 10 banks said the market for mobile payments is still too fragmented and immature, and 74 percent cited security concerns, however. Eighty-two percent of banks said they would partner with a third party provider to offer mobile payments.