By Dima Kats, CEO, Clear Junction
Mobile banking use is rapidly increasing worldwide. In the first half of 2020 alone, there were 26% more mobile banking app sessions globally than in 2019. Relative to even a few years ago, the number of people using mobile banking has skyrocketed. While the acceleration of mobile banking has indeed brought opportunity for financial institutions; it has also resulted in challenges.
There are significant security risks that arise from using mobile applications, including mobile banking apps. As businesses expand mobile payment capabilities, ensuring that business and customer payment data is safe is crucial.
With the growth of mobile and digital banking set to continue after the pandemic, banks must work to develop a seamless and secure environment for the future. Customer behaviour concerning mobile banking is changing, and businesses need to change too. Companies that fail to recognise this change will fall behind their competitors, while those who do adapt need to ensure they are putting appropriate security measures in place to protect their customers' data.
How to profit from the benefits while avoiding security pitfalls
Mobile banking offers unparalleled convenience, speed and accessibility to consumers – no more closures on bank holidays, tiresome queues, or inscrutable statements. It's no wonder people are adopting mobile payments and banking in droves; the benefits are enormous. While businesses rightly follow their customers in facilitating smooth mobile banking and payments, they must remain constantly vigilant to the security threats that mobile banking presents.
76% of mobile banking apps can be accessed by hackers, and with anyone from the app developers to the banks themselves capable of leaving vulnerabilities, it is easy for security to fall short at any stage.
Security and reliability are of paramount importance to mobile banking users. A substantial 62% of mobile banking users claim they would switch providers after a negative experience. With increased adoption and security risks tied to scalability, institutions need to be agile enough to embrace and scale their customer base while remaining vigilant about a smooth and secure service. Customers may abandon those who don't.
Increasingly, mobile customers bring a range of new security issues to businesses. Companies wishing to future-proof their payments structure and match the customer demand for frictionless online payments can ensure success by working with payment experts. Partnering with a specialist team can ensure financial institutions are able to provide their customers with the best mobile banking experience, while keeping data safe and secure.
Preparing for the future
Financial institutions have been on a digital transformation journey for several years, but now is the time to turn this into a competitive advantage. 24% of UK residents use some form of digital wallet and in some countries, like Russia, banking customers are extensively using their phones to withdraw money from cash machines. The need for cards, let alone cash, is likely to wane in favour of mobile phones over the next few years.
However, the ever-increasing variety of choices regarding mobile banking support can leave businesses at a loss when it comes to setting up the right system for them. In areas of the world that suffer from slow or limited internet capacity, mobile phone ownership is still skyrocketing despite poor infrastructure.
To grasp this opportunity, businesses and banks need to make sure they are working with payment experts who have experience managing online transfers across the world safely and securely.
Companies like Clear Junction connect financial institutions to a secure, regulated and optimised payment infrastructure to help them overcome the barriers of digital transformation and challenges relating to banking and payments. Getting the digital foundation right the first time is a definitive way to remain a step ahead of competitors, retain customer loyalty and ensure future success.