The mobile banking industry is growing faster than ever, becoming “nearly ubiquitous among Gen Zers and Millennials,” according to two recent studies shared in a Forbes article.
The article, Mobile Banking Adoption In The United States Has Skyrocketed, also shares that “nearly as many Boomers and Seniors have checked their account balance via a mobile device over the past year as younger consumers have.”
The demand for innovative mobile solutions is strong right now. And there is money to be made by companies that can respond quickly to these rising demands.
One source shares that “experts predict that mobile payments will grow at a compound annual growth rate of 29.0% between 2020 and 2027, expecting to reach $8.94 trillion by 2027.”
If you’re capitalizing on this growth by bringing a new mobile application to market, take time to first learn about eight big trends influencing new banking apps today:
One of the biggest trends impacting mobile banking is cardless ATMs. These are ATMs that allow customers to access their accounts and withdraw money without having to insert their physical cards into the machine.
Cardless ATMs verify identities by sending customers a SMS text message with a confirmation pin number, or by using other biometric methods like fingerprint scans, voice detection, or facial recognition. Some cardless ATMs also verify through the use of QR codes and Near-field communication (NFC).
These methods are meant to help reduce fraud attempts and lower the need for physical tellers at banks.
One source expects the cardless ATM market to grow by $2.11 billion over the next four years.
Chase, Mastercard, Bank of America, and Wells Fargo all offer cardless ATMs at banking locations in the U.S.
Image Source: Chase
Budgeting and spending tools are also popular features that developers are including in new mobile banking applications.
These features help meet the growing demand of consumers, who want a better view into their spending habits and more convenient tools to help budget finances from month-to-month.
According to Google, “73% of smartphone users have used an app to manage their finances in the past month.”
Another source reported that “personal finance mobile apps hit downloads of 1.3 B in the second quarter of 2020.” It also shared that “globally more than 75% of smartphone users surveyed have used at least one app in order to manage their finances.”
Budgeting apps typically include some or all of the following features:
The best examples of budgeting and planning apps are Mint, Sckeem, Goodbudget, YNAB, PocketGuard, and Honeydue.
Biometric security is another trend that doesn’t seem to be going anywhere anytime soon. Biometric security allows customers to gain access to their accounts using facial recognition, fingerprint scanning, voice detection, and even eye/iris scans.
There are three main reasons why more financial institutions and fintech companies are leaning into biometric security methods:
Reason #1: Passwords and pins are hard to remember. Consumers are not good at remembering passwords, especially as the number of accounts they have that require passwords continues to increase over time.
Reason #2: Biometric methods are more secure. Biometric methods are more secure than traditional passwords and pins and can help banks reduce fraudulent account access by criminals.
Reason #3: Biometric access is more convenient. Scanning an eyeball or pressing a thumb into a scanner is quicker and takes less steps than punching in a 4-digit pin or typing in a long password.
According to a report by ResearchAndMarkets.com, “the global market for Biometrics for Banking and Financial Services estimated at US$4.4 Billion in the year 2020, is projected to reach a revised size of US$8.9 Billion by 2026.”
Image Source: Wells Fargo
Some financial institutions and fintech startups are beginning to provide customers with a way to make payments using voice prompts.
In an article published by Plat.ai, author Lory Seraydarian explains that “mobile payment platforms and online wallets, such as Venmo, Square Cash, and PayPal, already allow their customers to use voice commands for peer-to-peer transfers. Moreover, traditional banks like Wells Fargo are adding conversational voice interfaces to their mobile banking apps.”
The main use case for voice payments? Online shopping according to the article by Seraydarian.
Another article shared a report that says “voice commerce is expected to reach some $80 billion by 2023. And transactions by smart home devices are expected to hit $164 billion by 2025.”
Both Google and Amazon are acquiring companies and testing ways to help bring voice shopping to their users.
Image Source: Google
Perhaps the most talked about trend worth noting in this article is blockchain-friendly banking. Traditional banks are starting to embrace the blockchain in an effort to keep long-time customers and woo new demographics that are investing heavily into Bitcoin and other cryptocurrencies.
In April 2021, US Bank, for example, announced new cryptocurrency initiatives to meet the growing demand from customers. One initiative, as explained in an announcement on their website, was “ a new cryptocurrency custody product for customers with the engagement of a sub-custodian for fund servicing.”
The bank also announced an investment in Securrency, “a developer of institutional-grade blockchain-based financial and regulatory technology.”
Wells Fargo regularly publishes education content to help their customers learn more about Bitcoin and cryptocurrencies.
A study by Gallop found that only about 30 percent of U.S. households have a long-term financial plan.
One reason for this low number may be due to a general lack of education around finances, financial planning, and saving.
To help improve financial literacy and wellbeing of their users, more fintech companies and banks are investing heavily into content that can be found within their mobile applications and websites.
Chase, for example, has a robust education center that customers can access when they need help understanding topics related to consumer banking, loans, mortgages, and more.
Mint, a personal finance and budgeting app, has long been known for the content they produce to help users make the right financial decisions.
Image Source: Mint
Instant payments is another trend that is changing how companies build banking applications. The purpose of instant payments is to give customers faster access to the money they’ve already earned.
This feature is particularly useful for the growing number of people working within the gig economy—people who want faster access to tips and wages they earn while working.
Branch, for example, offers technology that employers can use to send instant payments to contractors after each job they complete.
A final trend worth noting relates to how banks are utilizing AI technology when building mobile applications.
A report by McKinsey details the benefits of AI for banks:
“AI technologies can help boost revenues through increased personalization of services to customers (and employees); lower costs through efficiencies generated by higher automation, reduced errors rates, and better resource utilization; and uncover new and previously unrealized opportunities based on an improved ability to process and generate insights from vast troves of data. More broadly, disruptive AI technologies can dramatically improve banks’ ability to achieve four key outcomes: higher profits, at-scale personalization, distinctive omnichannel experiences, and rapid innovation cycles.”
AI technology can help banks improve both customer experience and back office productivity, as illustrated in this visual from the report:
Image Source: McKinsey
The demand for mobile banking applications is at an all time high. Understanding these trends before you start building can help you design and prioritize features you know your audience will want to see when you launch.
Need help building your application? Learn how Crowdbotics can work with you to bring your app to life in less time and for less money than other options.
August 11, 2022