Mobile banking has been going on strong in Asia. The number of mobile banking users worldwide is forecasted to grow from 55 million in 2009 to 894 million in 2015 with Asia accounting for over half that number.
Banks have long talked about the promise of being able to bank on the go; first on your computer and now on your mobile phone. However, the acceleration of mobile banking has really been driven by the advent of the smartphone and the proliferation of mobile data plans. Coupled with the popularity of mobile apps, this has provided the opportunity to create really rich and enjoyable banking experiences on the go.
Going beyond the transactional aspects of banking and towards a more lifestyle oriented approach, here are four banking applications which I think will slowly become an indispensable part of our mobile lives:
1. Mobile payments
The mobile phone holds the key to the future of payments for consumers. With the proliferation of mobile handsets in Asia and the prominence of mobile payment transactions, customers are increasingly expecting financial and payment services to be offered on their mobile devices.
Starbucks in the U.S has begun accepting mobile payments at its nation-wide stores using 2D barcode scans. At the same time, with the development of Near Field Communications (NFC) technology within Asia, some banks have already started NFC trials along with mobile operators.
We've all been in this familiar situation before; sharing a meal with friends and then having to split the cost when the bill comes later. Imagine being able to do this seamlessly using just your mobile phone and not having to worry about awkward calculations and having change. Paypal in the U.S. uses the Bump application to allow iPhone users to transfer money by simply bumping their phones together. It even has a bill splitter that allows a simple and convenient way to calculate and split the dinner bill between friends.
2. Remote Deposit Capture (RDC)
A key attraction of mobile banking is that it provides added value to users in the form of enhanced convenience. Technology changes behaviour and consumers are getting used to the speed of information which drives the need for faster service delivery. The use of online and mobile banking meant most of the usual over the counter transactions services could be done 24/7 anywhere as long as you were connected. However, there are still certain banking transactions that cannot be done remotely as yet.
The conventional process of depositing checks results in having to plan and make a trip to the bank or ATM to drop it off. With RDC technology, this will soon be a thing of the past.
Chase bank launched this feature via its mobile app last year and it goes to see how fast it would take for this to get rolled out in Asia.
Other than the technology uptake, the bigger consideration is the security implications that may not make it pass the much stricter regulatory and compliance environment here.
3. Mobile coupons and loyalty cards
Consumers have always been attracted by loyalty points and discounts. However, it is traditionally difficult for bank marketers to track usage and results by channels and distinguish the success of these offers delivered online vs offline. Coupons delivered on mobile via SMS barcodes were expensive to implement; requiring heavy investment on point-of-sale scanners and hardware to capture data.
Enter coupons that are delivered via a mobile app. This provides the advantage of being able to easily update timely and relevant offers while having the capability to track real time usage. There are also no additional requirements or investment on the merchant end; allowing offers to be easily added and fulfilled among the large pool of merchants that banks already work with.
A few banks in Asia have already rolled out smartphone applications that contain mobile coupons. These coupons can be activated by flashing them at the merchants where it is "redeemed" and deactivated from further use (for one-time offers). Another alternative is for each merchant to have a specific code, which they would need to key in on the customer's smartphone during redemption. This allows the same offer to be used multiple times and also allows marketers to track specific outlets from the same merchant that the offer was activated.
Using this same concept, we can also build in the idea of loyalty cards (think of stamp cards where you get one stamp for every purchase and once you accumulate eight stamps, you get something for free). With the delivery of mobile coupons via smart phones, there are now multiple ways marketers can choose to deploy and track their usage and mobile rewards programmes.
4. Location-based services
Mobile banking apps these days come with standard features that leverage on location-based services to provide context and relevance to customers. This benefit can come in the form of convenience, value or even cost-savings.
Need money? No problem. Whip out your mobile phone and find the nearest ATM machine based on where you are. Most of us have done this and the convenience and peace of mind it brings not to have to worry about being unable to find an ATM is indeed priceless.
Want to know where you can enjoy the best deals and offers with your credit card? Again, with a few clicks, you can now get timely information on one-for-one deals or discounts on your shopping and dinning with your bank's credit card delivered in context based on where you are.
In this case, the mobile application acts as a delivery mechanism that helps you fully experience and access what the credit card (or respective banking product or service) has to offer.
There are many other aspects of mobile banking and functionalities that have not been covered here. Please feel free to add on and share your thoughts on the next generation of mobile applications that will change the way we bank on the go.
Mobile banking in Asia is positioned for a strong growth. By giving people more control over their banking experience, banks will be able to win their loyalty. Mobile banking is not just another marketing channel for banks or a way for banks to migrate transactions to reduce costs – It's how consumers are living their lives and defining true mobility. Consequently, it is now the way banks have to conduct their business.
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Vincent is the co-founder and partner at C//IQUE, a product development studio and incubator that focuses on developing digital products and services that disrupt traditional business models and empower consumers. He has over a decade of experience both on the client and agency side, most recently as a digital planning director at BBDO/Proximity and lead digital strategist at Publicis. Prior to that, he started-up and managed the Hong Kong office of Splash Interactive Group and built the online business at Citibank and HSBC. Connect with him on Twitter @intersphere.
March 19, 2014