Six Ways Mobile Applications are Improving the Financial Industry
Mobile banking applications are quickly becoming an essential channel for banking customers accessing their financial services.
CACI has predicted that by 2021 mobile banking will become the largest channel in terms of UK-based users, with applications overtaking physical branches of banks across many countries worldwide.
Here in the US, mobile banking applications are used by 30% of customers according to the Omnichannel and Branch Banking: The Current U.S. Consumer Banking Environment survey, while the penetration rate of personal mobile banking in China stood at 57% in 2018.
The rise in popularity of mobile banking applications is mostly down to an increase in usage by younger adults. The Business Insider Intelligence’s Mobile Banking Competitive Edge study showed that 89% of survey respondents regularly use mobile banking. However, this percentage rises to a staggering 97% when we look at the habits of millennials.
WHAT ARE THE SIX LEADING BENEFITS OF MOBILE APPS IN BANKING? ENHANCED SECURITY
In 2020, cybercrime is a considerable threat across many industries. That said, banks and financial institutions can utilize mobile app development to guarantee enhanced levels of security. Extra hardware security options make mobile banking applications more secure than online alternatives. Biometric authentication is a leading advantage that mobile phones offer consumers.
REDUCED OPERATIONAL COSTS
When a bank invests in bespoke mobile banking applications as their leading channel for financial activities, they can reduce their operational costs. Mobile apps allow banks to go paperless, saving money, time, and natural resources. They also allow banks to reduce expenses associated with branch operations and maintenance. Additionally, mobile app transactions are over 90% cheaper than ATM alternatives.
ADDITIONAL REVENUE STREAMS
A 2016 study by Fiserv found that mobile banking applications can impact the return on investment and customer engagement in several ways. Banks can generate additional revenue by integrating value-added services into their applications. Loan offerings and insurance suggestions can be automated via push-notifications, and retail offers such as travel insurance can be applied to qualifying customers. Customers that use mobile apps are more engaged with banking activities and use more products than branch-only customers. Additionally, if their experience is excellent, their loyalty to their financial institution increases.
IMPROVED CUSTOMER EXPERIENCE
With a well-designed, functional mobile app, banks can massively improve their customer experience. Banking apps are available 24/7 and easily accessible at all times. Customers can fulfill any banking needs wherever and whenever they choose. Also, personalized options on products or services can be customized to individual customer requirements.
Mobile applications powered by Machine Learning can offer tailored insights for customers based on factors that are important to the individual. These applications display relevant information following the predictions of an ML model.
MOBILE ANALYTICS ARE POWERFUL
We’ve reached a time in which data is a more powerful commodity than oil. Using mobile applications, banks can collect and analyze a myriad of data from their customer feedback. This data can be used to develop new products and improve services based on customer habits and needs. This is an incredibly powerful knowledge for any service-oriented institutions; after all, the customer is king.
IMPROVED COMMUNICATION THROUGH PUSH NOTIFICATIONS AND IN-APP NOTIFICATIONS
When it comes to communications between a bank and a customer, mobile apps are incredibly effective. In-app and push notifications can improve customer relationships and trigger certain actions when used efficiently. They can also be used to disseminate important information from the bank to the customer. Additionally, there is a much higher chance that a customer will notice and read a notification compared to a letter or an e-mail.
Financial customers want a personalized, dedicated, well-designed, useful application from their bank.
Today’s customers are attached to their smartphones and therefore expect their financial institutions to be available from these devices. Combining high-security standards with rich and useful features help banks to retain customers and acquire new business.