Even before the COVID-19 pandemic led to stay-at-home orders and changes in the way we do business, there was a strong trend toward digital banking and financial management. However, the pandemic has had an undeniable impact on the way we bank.
In a recent Forbes article, experts discussed how the pandemic affected mobile banking, which features are the most and least popular and what they expect will happen with mobile banking when the pandemic is over.
Let’s start by looking at how many people have been using mobile banking to manage their money. An Ipsos-Forbes Advisor U.S. Weekly Consumer Confidence Survey revealed that 76% of respondents had used the mobile app from their primary bank within the past year. Only 21% said they had never used their bank’s mobile app. (It is worth noting that only 5% of respondents between the ages of 18 and 34 said they had never used a mobile banking app.)
Amit Aggarwal of J.D. Power pointed out that credit unions and banks were able to keep up with the shift to mobile banking because it wasn’t new:
“The banks have been investing in these platforms for a long time, so they were generally well poised to take advantage of the accelerated shift to digital that came in 2020.”
It would have been far more difficult for credit unions, banks and consumers to handle the challenges of COVID-19 if mobile banking weren’t already well-established and widely available.
One thing that we have been extremely interested to see is which mobile banking features have most resonated with users. We’ve all had to adjust to life during a pandemic and some features clearly rose to the top in terms of their usefulness:
What we see with these results is that the preference for time-saving and convenient features is strong. With so many of us working and learning from home, it makes sense that mobile check deposits would rise to the top as the favorite mobile banking feature.
As we’ll discuss in the next section, it also makes sense that consumers who are new to mobile technology would prioritize the most fundamental mobile banking features such as check deposits and money transfers. Their preferences may shift as they become more accustomed to using mobile banking tools to manage their money.
Of course, not every mobile banking feature can be the favorite. Here are the features that were included in the survey and the percentage of people who favored them:
While you might think that these numbers indicate a lack of interest in these features, that’s not the case. A 2020 J.D. Power study found that the consumers who had the highest percentage of digital banking satisfaction were those who had their bank accounts linked to peer-to-peer payment apps such as PayPal, Venmo and Zelle.
We should also note that a lot of consumers use peer-to-peer payment apps from their phones and may not even realize that they are included in mobile banking apps. We also think that the relative lack of interest in ATM-related features may be due to a pandemic-related reluctance to use cash.
Amit Aggarwal of J.D. Power noted in the Forbes article that consumer adoption of advanced mobile banking features, such as financial advice, financial management and alerts, is not as high as adoption of mobile deposits and other basic features. However, people who use advanced features are more likely to be satisfied with their mobile banking experience than those who do not use them.
There are two key things that we picked out as important in the Forbes article. The first has to do with use of mobile banking going forward.
A Mobiquity survey cited in the article found that a whopping 90% of respondents said they would continue to rely on mobile banking even after the COVID-19 pandemic ends. The ease and convenience of mobile banking isn’t something consumers want to give up – and we expect that they won’t.
The second thing we think is worth mentioning is that high consumer adoption of mobile banking is going to pose a challenge for credit unions and banks going forward. As consumers become accustomed to the basic features of mobile banking apps, including things like mobile check deposits and online statements, they are likely to explore the more advanced features.
While the current results indicate that adoption of advanced features may increase customer satisfaction, it is reasonable to anticipate that consumers who become more sophisticated in their use of mobile banking apps will expect banks to keep up. They may expect new features to be added – and the survey indicated a high willingness to switch financial institutions to get access to the best mobile banking features. Forty percent said they would switch banks to get better mobile features and 37% said they were more likely to do so now than they were in the past.
What that means for financial institutions is that it’s going to be increasingly important to listen to account holders and learn which mobile banking features they want. We can’t predict what the future will hold. It may be that contact-free ATM withdrawals become a priority – or it may be that most consumers stop using ATMs altogether and new technology takes their place.
Whatever the future holds, it’s a priority for Addition Financial to put our members first and adapt to their changing needs.