Over the past several years, mobile banking solutions have generally been met with open arms by credit union members; at the same time, some members still prefer to visit a brick-and-mortar branch for everyday services and transactions. This tells us that while a mobile transformation is clearly underway, traditional methods of banking are still relevant.
Credit unions have an opportunity to satisfy the unique demands of members by delivering an excellent member experience through whichever channels the member prefers — including mobile, online, or in-person interactions.
In light of the growing demand for mobile services — particularly among younger members — credit unions need to have innovative mobile technology in place to deliver a robust member experience. Furthermore, credit unions need to think about the emerging, disruptive technology that will radically alter the entire service landscape in the years to come.
The Role of Disruptive Technology
All financial services providers are taking note of disruptive technology: for example, in his annual letter to shareholders this year, Jamie Dimon, CEO of JPMorgan Chase, warned of the threats posed by “Silicon Valley start-ups” focused on lending, payments, and leveraging mobile channels to provide financial services to consumers.
The rise of Apple Pay and an array of other mobile financial services options are bringing increasing competition to the market. Credit unions that do not embrace and adopt new ways to reach and serve members risk losing key demographic segments to these new competitors.
Information security, fraud prevention, and data analytics must also remain top of mind, as the migration to EMV and tokenization are expected to reduce the risk of payment fraud for consumers, merchants, and financial institutions — while offering new opportunities to build member relationships.
Research Indicates Rising Popularity of Mobile Services
Each year, Fiserv conducts a Consumer Trends Survey to measure the financial service preferences of U.S. consumers. The latest results represent the opinions of 106 million households that use the Internet and tell us about the growing demand for mobile banking — and why credit unions need to react accordingly.
Up-and-coming generations strongly prefer mobile services – About half of Millennials (51%) and more than a third of Gen Xers (35%) indicate they are mobile banking users; older generations are also embracing mobile technology, albeit on a more gradual basis. This generational divide underlines the need for credit unions to deliver an experience that caters to each member’s personal preferences.
Mobile services need to be dually optimized for smartphones and tablets — While the recent use of smartphone-based banking is most popular (48% of all generations), the recent use of tablet-based banking is also considerable (37% of all generations). Thus, credit unions need to consider both smartphones and tablets as components of mobile banking — and optimize their interfaces for each respective device.
To increase member loyalty through mobile services — Fiserv recommends that credit unions proactively encourage members to use the most popular transactional features of smartphone-, and tablet-optimized mobile banking solutions, including P2P payments, mobile deposits, and mobile bill pay.
The Big Picture – How Mobile Banking Enhances the Member Experience
As the metrics demonstrate, the use of mobile banking is popular — especially for younger generations — because this channel enables a highly customizable member experience that is secure and very convenient.
But what about older generations?
Although there is currently a generational divide on mobile banking users, the fact remains that year-over-year adoption rates are growing among older demographics. With this in mind, credit unions should consider targeted mobile banking marketing campaigns that appeal to different generations — including boomers and seniors who may be considering the use of smartphone-based technology like P2P payments to send money to their children or grandchildren.
In the bigger picture, mobile banking is a key pillar of the enhanced member experience — enabling anytime, anywhere account access. While each feature of mobile banking may not have the same level of appeal to everyone, offering a robust mobile banking service with a variety of informational and transactional capabilities results in a very powerful and personal member service, which also provides a steady stream of data that can be used to grow relationships with members.
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