With the rise of mobile banking and mobile credit card readers, major banks worldwide are beginning to open their eyes to the possibility of a paradigm shift in the banking industry. Marketforce and the Institute of Economic Affairs have gathered in London to discuss one major elephant in the room, mobile banking. One major question was posed during the session; do new entrants have an advantage over traditional banks in mobile banking? The short answer would be yes, as 56% of the audience agreed with the question. Many banks in the past few years have taken a conservative approach to mobile banking, as they have many security concerns, regulations, and massive size.
Discussions about mobile banking led many to the sentiment that they needed to take a step back and look at the current mobile banking ecosystem and realize that it is constantly changing - major banks need to keep up with mobile trends. Adam Kennedy, Product Director of Vocalink, stated that “next day doesn’t cut it” for consumers and they feel “the faster I get the money, the better”. The underlying context to the rhetoric throughout the session was that major banks need to understand that the driving force behind the success of mobile banking will be the consumer over the merchant. In order to have a successful mobile banking system there needs to be a meaningful experience, in which the community of users drives its growth. Mobile banking sites and applications need to shift the data back into the hands of the consumer to allow them visibility on their own finances.
I currently use mobile banking quite regularly, but find myself managing my finances through third party applications like Mint over my bank’s mobile site. This is directly because of the aforementioned statement about bank’s mobile sites not having enough visibility to what is actually happening to my money on a day-to-day basis. John Lunn, PayPal Director EMEA, summed up the current mobile banking ecosystem by stating that banks are 14 years too late playing catch up. This has opened up the playing field for third party banking sites and applications, and the next few years will determine the direction of major banks in mobile banking ecosystem.