Mobile banking apps are becoming an increasingly important factor in how consumers choose and interact with their financial institutions. As banking activities move from branches and desktop computers to smartphones and other mobile devices, customers are beginning to judge banks not simply by whether they offer mobile banking, but by the quality of the experience they provide.
For financial institutions, that shift changes the competitive landscape. Being among the first to launch a mobile app is no longer enough. Banks and credit unions must focus on usability, functionality, convenience, and design as consumers spend more time managing their financial lives through digital channels. The mobile experience could increasingly determine which institutions attract new customers and which ones retain existing relationships.
The movement of banking activities to the the mobile devices has taken place, and while reservations exist some consumers, the shift in how customers are swayed is underway.
Banks Compete to Deliver the Best Mobile Experience
The race to offer the best experience across all digital banking channels is “the next battleground for banks”, according to the 2016 SITEisfaction survey by insights company Columinate. “What was once a war of getting the first app to the market is now a war of having the best banking app in the market,” according to Columinate’s analysis, published the day the survey results were released.
Mobile Banking Becomes the Primary Customer Touchpoint
Mercator Advisory Group arrived at a similar conclusion. The look, feel and flow of a FI’s mobile banking app will increasingly be the primary point of engagement. While we believe branch offices and Kiosks will certainly play a role in consumers’ perceptions, the time spent and the expansion of activities and the eases at which they are conducted in the mobile digital environment will be the main determinant for choosing a FI to bank with for more and more consumers.
As consumers become increasingly comfortable conducting everyday banking activities through their smartphones, the quality of mobile banking apps will play a larger role in shaping their perceptions of financial institutions. Customers will expect apps to make common financial tasks simple, intuitive, and convenient rather than merely providing a mobile version of services available through other channels.
Branches and kiosks will continue to influence the overall banking relationship, particularly for transactions and services that benefit from personal interaction. However, customers are likely to spend considerably more time interacting with their financial institution through mobile channels. Those frequent digital interactions give banks and credit unions an opportunity to strengthen relationships—or risk frustrating customers with an experience that fails to meet their expectations.
Financial institutions that treat mobile banking apps as a central component of the customer experience rather than simply another delivery channel will be better positioned to meet these changing expectations. As mobile banking capabilities become increasingly common, differentiation will depend less on whether an institution has an app and more on how effectively that app helps customers manage their financial lives.
Overview by Joseph Walent, Associate Director, Customer Interactions at Mercator Advisory Group
