BOSTON—The rise of mobile banking is leading to the rise of the mobile consumer—one who is likely to switch a PFI relationship for better e-services.
Mercator Advisory Group’s recent Insight Report from the bi-annual CustomerMonitor Survey Series reveals that consumers, especially young adults, are likely to switch their PFI to gain more robust mobile banking services.
The company explained that three in five U.S. consumers perform banking activities using their mobile phone and/or tablet, up from nearly half who did so in 2013 and one-third who did so in 2012.
“Mobile banking via smartphone or tablet is growing rapidly, fast becoming a way that many bank customers and credit union members prefer to conduct their banking activities for its convenience and ‘on the go’ accessibility,” Mercator said.
Mobile-based money transfer to another person’s account is one of the fastest-growing mobile banking activities, doubling in usage in the U.S. from 2013 to 2014, Mercator noted. In 2014, half of young adults surveyed used their mobile phones to transfer money to another person’s account and 22% of young adults used their mobile device to transfer funds to accounts outside the U.S.
Young adults, because of the transient nature of their life stage, have always been more likely to switch financial institutions, but over the past two years, young adults have reported switching far more than usual, Mercator said.
“In fact, 31% of young adults and 28% of mobile banking users surveyed in 2014 reported they switched their financial institutions over the past two years, a notable increase from approximately 20% who reported doing so in our 2013 survey,” the company explained. “Young adults and mobile banking users are now nearly twice as likely as the average U.S. consumer (16%) to have switched.”
“Improving the usability and functionality of mobile banking will continue to be vital for customer retention,” said Karen Augustine, manager of primary data services at Mercator.