What more can mobile banking do for consumers?
What have you done for me lately?
That's a question consumers seem to be asking their banks these days despite the advances financial institutions have made the past few years with their mobile banking apps.
Mobile remote deposit capture is not the trendy feature it once was for banks. It's expected. Today, consumers desire a way for banks to help them make the best decisions with their money.
Personal finance management tools are great and all, but that might not be enough for some consumers. With that said, what more can mobile banking do for banks' customers?
"From our perspective, the experience that the user needs is a meaningful interaction between the bank and that user," Richard Steggall, co-founder of white-label digital banking provider Urban FT, told Mobile Payments Today. "How do the transactional services that a bank is providing tie into, in a seamless way, the day-to-day lifestyle of consumers, especially how and when they spend their money."
Steggall's view aligns with some recent consumer survey work from ath Power Consulting that shows consumers want money-saving digital services from their banks.
Of the 2,379 survey respondents that identified themselves as current mobile banking users, 62 percent said a loyalty program is an advanced digital feature they were interested in. Some 51 percent of consumers cited discount coupons as another desirable feature.
Mobile payments, in comparison, tied for third place with personal finance tools at 35 percent.
"There's something there," Ed O'Brien, executive VP of research and strategy at ath, told Mobile Payments Today in regards to consumers' desire for loyalty options from their banks.
However, the challenge banks face in providing such services is two-fold, he said.
Banks must be weary of that creepiness factor when monitoring a customer's transactions to reward them with coupons and offers. As long as there is an opt-in option, banks should be fine, O'Brien said.
Financial institutions also must educate their customers about the value of using such money-saving features.
"Banks need to educate consumers that they can help them," said O'Brien, who will serve as a panelist at next month's Bank Customer Experience Summit in Chicago. "The idea [behind loyalty] would be to help them make more educated purchasing decisions."
That's something Urban FT strives to do with its offerings.
Steggall said the main attraction of how his company does loyalty is that Urban FT's algorithms sift through a consumer's transaction data and only pushes relevant discounts and offers if there is one to be had.
For example, if a consumer frequents the Cheesecake Factory, there's a good chance he or she would be interested in the P.F. Chang's across town. If there's a relevant offer for P.F. Chang's, the bank using Urban FT's product will send a push notification.
It's not intrusive, and the bank can go to a customer with an offer instead of waiting for them to access a section of a mobile banking app that contains, for example, cash back deals.
"This is what I'm saying about, the ability to help your customers save money on everyday purchases through providing genuinely intuitive suggestions" Steggall said. "That's all it is. We're not trying to compete against Yelp! or Google.
"We're trying to provide a localized experience that only the customer can see. We're taking their data and providing them with meaningful enrichment of that data."
Such as feature is one that could differentiate a smaller bank from a larger one, or put a regional bank or credit union on par with the national behemoths, Steggall said.
While Urban FT works with small-and-medium-sized financial institutions, Steggall believes the bigger banks now are in a position to be the innovators after watching fintech startups make most of the noise, with some failures, in the past couple of years.
"The banks have taken on innovation," he said. "A couple of companies found their niche and have provided genuine value in the industry but a lot of those people that came out and demonstrated innovation are not around anymore.
"Banks learned from that, they watched what happened, they took what they liked, and their in-house teams took those products to market. That's the cycle you go through in any industry."
The "killer" feature
As for what could be the next "killer" or must-have feature for mobile banking, it actually sounds kind of boring: account opening.
Indeed, there still exists some gaps in how banks provide existing and perspective customers with the ability to open any kind of account without entering a branch.
The ath study revealed consumers have a strong awareness and interest in mobile/online account opening.
Fifty-one percent of digital banking users have opened an account online, while 58 percent have attempted to open multiple accounts.
However, online account opening is not without its problems.
Twenty-eight percent of respondents who started to open an account online failed to complete the process. The reasons cited for this included, the time to complete the terms and conditions section took too long (42 percent) and that the overall process was too complex (39 percent).
"Maybe account opening is not an exact parallel to being a killer feature like mobile remote deposit," O'Brien said. "But it's close because even if people say they don't want online account opening, they want the capability to apply online, open and fund an account."
The rest of the best
Mobile person-to-person transfers is all the rage right now with Venmo's success and the recent introduction of the bank-backed Zelle network. But the feature is not at the top of the list for mobile banking users with 40 percent of respondents citing it as an important function.
Consumers are much more interested in the ability to report a lost or stolen card (79 percent), reset a user ID or password (70 percent) and stop a payment (63 percent), according to the ath study.
Whether Zelle truly has a chance against the mobile P2P stalwart Venmo, O'Brien believes there is a silver lining for banks.
"It's clear that with many banking customers that if all else was reasonably equal, they would trust the banks and credit unions [over others]," he said.
Will Hernandez has 14 years of experience ranging from newspapers to wire services and trade publications. Before becoming Editor of MobilePaymentsToday.com, he spent two years as the content manager for PaymentsJournal.com, a leading payments industry news aggregator and information hub published by Mercator Advisory Group. Will spent four years covering the payments industry as an associate editor for multiple publications in SourceMedia's Payments Group based in Chicago.