What’s Next to Leave the Branch?

By Deb Stewart

How long could you last without your smartphone? In Bank of America’s recent “Trends in Consumer Mobility” report, 44 percent of respondents said they couldn’t make it a day without their mobile device. This need for constant connectivity extends to mobile banking—six in 10 respondents have tried a mobile banking app, with 62 percent of those accessing it a few times a week or more.

We’ve already seen the effects of this extensive adoption on branch transaction volume. We know that fewer and fewer customers come into the branch to deposit a check or to check their balance or to see their recent transactions. But is there more to come? Are there other mobile capabilities in early adoption or on the horizon that may siphon off further transaction volume? We asked some experts in the mobile banking field that question and here’s what they said.

Commercial deposits
James DeBello is the CEO of Mitek, a company that provides the remote imaging infrastructure for all of the top 50 banks and over 5,050 other financial institutions. DeBello predicts that one of the next transaction types to move to mobile will be commercial deposits.

“Remote deposit as it exists today has only scratched the surface,” says DeBello. “The next wave is in pilot at several financial institutions. Remote deposit for business allows multi-check capture. So, rather than singularly snapping a check photo, you can take multiple photos of the front and back of five or 10 checks. A single deposit is made summing the total of the checks, providing the user with a summary of those checks as they would a deposit slip. Your accounts receivable clerk is saving time, you’re saving money on courier services and the money is in the bank faster.”

Account openings
Robb Gaynor is the chief product officer at Malauzai, working with over 420 banks ranging in size from $20 million to $11 billion in assets. Forty percent of the mobile customers at these banks are mobile-only. He predicts that one of the next mobile features to affect branch usage will be in the area of account openings.

“With advances in image capture and ID verification, it takes about five minutes to open an account on your smart phone. In the past, there have been abandonment rates as high as 30-40 percent on mobile account openings as consumers quickly tired of entering information. Today, we can capture a driver’s license image and immediately begin the process of opening a personal line of credit, or credit card or even a savings account or CD,” says Gaynor.

P2P payments
Kwafo Ofori-Boateng is global director for omnichannel, mobile and digital solutions at IBM. He sees peer-to-peer payments as another area that could affect the branch by reducing the need for cash. “We have to acknowledge that P2P payments have been slow to take off principally due to the relative complexity and often the need to have both parties bank with the same institution. The expectation that the product would be used for day-to-day types of exchanges has not borne out,” Ofori-Boateng says. And yet, the Bank of America report found that 56 percent of respondents would consider paying someone using person-to-person payments via a mobile banking app, indicating that the demand is there.

“P2P will continue to grow in usage as awareness and ease of use increases,” Ofori-Boateng continues. “The implication of this will be less demand for cash coming from both ATMs and branches. But in order for P2P usage to really accelerate, the process needs to become more familiar, more seamless.”

What are implications for your branches?
Commercial deposits, account openings and P2P payments were identified as some areas to watch. Each of these may bring both risk and opportunity.

Helping business customers to conduct their business more efficiently through remote deposit capture continues to build value in your relationships. And recognizing and enabling a growing consumer desire to minimize the use of cash is responding to change in a positive way.

Are these the next big things in mobile banking? Are there others? No one knows for sure. The only sure thing is that consumer expectations will continue to evolve and we will continue to evolve with them.

Deb Stewart of Charlotte, N.C., is an independent consultant working for the financial services industry. This article originally appeared on ABA Bank Marketing.