By Howard Berg, SVP, Gemalto

The mobile is now at the centre of a number of everyday activities in our lives; from communications to gaming, to navigation, to payments.In fact, it’s become so interwoven in our lives that it’s now hard to imagine a world without mobile or our trusty mobile device. The smartphone, particularly, hascatalysedchange like few other inventions, and is a trend thatshows no sign of abating anytime soon.

Arguably, banking has been impacted more than any other industry. Coupled with the rapid rise of home banking following broadband penetration in the 2000s, the 2010s have shown us that all banks in countries with widespread mobile internet need a mobile presence. According to the UK’s Office of National Statistics[1], half of adults and more than three-quarters of 25-34 year olds now manage their money online.

While these figures are exciting, they only analyse the usage trends of over 18s – with no specific insights into the behaviours of teenagers, young adults, or even the slightly older ‘born digitals’ – a consumer base that banks need to pay attention to, given they’re set to be the future wave of customers. Indeed financial institutions across the UK and the globe need to pay close attention to the habits of these consumers who have grown up with the internet and would struggle to imagine a world without it. It’s imperative for the banks to see how these people who have grown up withdigital services view mobile banking, as it could be the key differentiator between them choosing one bank over another.

With smart mobile devices playing such a leading role in young people’s everyday lives, it makes sense that banking habits are changing to follow suit. According to recent Gemalto research[2], accessing banking services either online or via an app is already seen as “essential” for a quarter (24.2%) of young consumers.Convenience undoubtedly plays a large part in thisas their funds are accessible at anytime, but there are other factors at play such as a mobile device helping them to maintain better control over their finances.

Although they have truly embraced mobile devices and mBanking, it would be wrong to assume young people are aware of the risks when it comes to security. Manyseem concerned about the risks they face when using a mobile banking apphowever, the need for an easy to use service outweighs their fears and willingness to do anything about it.There needs to be a balance.

Howard Berg
Howard Berg

For example, recent findings from[3] Gemalto research showed one in three respondents would be happy to access online or mobile banking services via public Wi-Fi services. This is an easy and convenient way for young people to access their banking details,but they could be at risk in case of an unsecure connection. It’s therefore important for banks to make sure they have security solutions in place to face the growing demand of mobile banking. Regardless of Wi-FI connection, the app needs to be be secured to mitigate known threats.

When looking to the quality of mobile banking, young people want a fully featured service with access to all the functions they have come to expect from the online or in-branch experience. In a world where the pace, quality and intuitive nature of apps have been defined by innovative, agile consumer technology companies, such as Google, YouTube Facebook, Spotify and Twitter, financial services companies still need to work hard to catch up. Apps from competitors can be downloaded and installed in seconds and banks need to realise that a fiddly, unresponsive or unreliable app could well cost them customers quickly.

Securitycannot be an after-thought when designing an app, it must be included in the discussion and built in from the start to ensure a positive user experience; whilst ensuring compliance needs are also being met.

This shifts the sands of customer retention. In the past, people banked with the same institution their parents used, and their grandparents before them. This all changedfollowing the financial crisis and the arrival of new technologies, which has opened up the market.

Consumers can switch banks easily thanks to recent regulation making it significantly simpler to do so, but a sense of dissatisfaction with the consumer experience, service and products will have underlined each and every move.

Non-traditional financial services companies such as Apple, PayPal and Google are entering the financial services space and blowing the market wide open, and you have a market context in which financial services institutions need to be much more proactive about engaging with their customers – particularly the digital natives.

Banks should be using the mobile channel to cost-effectively engage and deliver product offers and general content to the right customers at the right time, driving organic growth and customer retention – and ultimately increasing revenue.

This can come in various forms from dynamic messaging programs to deliver “tappable” tailored offers and content, to the pre-login mobile apps screen, to contextual messages to customers based on their profile, activities and attributes. Mobile can also been used to engage people in non-sales experiences as well, for example, messages about digital fraud prevention or value-added content such as guides for first-time home buyers or parents.

The impact of the younger generations through their use of smartphones and tablets on the financial services industry has been huge, and as mobile adoption grows, so too will the demand to access financial services on these devices. Financial institutions across the UK and the globe need to take serious notice of mobile technologies, and understand that the importance of not just having a mobile app, but a fully built out feature set and user friendly service. The experience for the customer needs to be the best it can be, without compromising on security – this will result in a great banking experience for consumers both young and old, and will pave the way for a mobile future.




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