Largest (and Newest) Banks Set Standard for Mobile Banking Excellence

The largest US banks have significantly improved the design and functionality of their mobile offerings over the past year across a wide range of criteria. These innovations, as well as those by mobile-first banks, are setting a new standard for mobile banking excellence.

Subscribe TodayThe impact of having a leading mobile banking experience has been documented often over the past several months. From having an impact of consumer satisfaction, to improving the perceived level of convenience of a financial institution, the importance of making continuous improvements to mobile banking applications can’t be overstated.

The 2016 Mobile Banking Functionality Benchmark from Forrester evaluated the mobile banking offerings of the five largest retail banks in the US. In this study of the largest (and many times most progressive) mobile banking offerings, Bank of America and Wells Fargo were ranked the highest, with all of the largest banks having strong features for research and customer acquisition. In comparison, a year ago, no large bank stood apart from their peers in Forrester’s mobile banking assessment.

The research evaluated seven criteria:

  • Supporting wide range of touchpoints
  • Enrollment and login
  • Account information and money management
  • Transactional features
  • Service features
  • Cross-channel guidance
  • Marketing and sales

Establishing the criteria for review, Forrester started with the development of a mobile banking user persona, reflecting the range of activities expected by a typical user. These included the ability to easily check balances and recent activity, the ability to transfer money, pay bills and deposit a check and the availability of tools to assist in basic money management. Because the expectations of consumers change over time, the benchmarks for evaluation also change each year.

Touchpoint Support Continues to Expand

To provide a positive mobile banking experience regardless of how consumers interact, it is important to be able to support a wide range of smartphone and tablet apps as well as strong mobile websites. To accomplish this, leading banks used the following strategies.

  • SMS Banking – While decreasing in importance overall, leading banks provide consumers without smartphones the ability to conduct basic mobile banking (check balances, view activity and transfer funds) by text messaging.
  • Mobile Website – All of the banks reviewed had mobile optimized websites to conduct basic transactions with more advanced features, such as finding an ATM or branch location offered by some.
  • Alternative Operating Systems – All of the banks reviewed supported Android and iOS, with Bank of America also supporting BlackBerry OS and Wells Fargo supporting Windows Phone.
  • Tablet Banking – All of the banks reviewed offered downloadable apps for at least one type of tablet, with most banks offering tablet banking for multiple platforms. In addition, several of the banks reviewed provide unique solutions specifically suited to the larger format and tactile capabilities.
  • Emerging Touchpoints – As additional touchpoints are introduced such as wearables, in-car applications and IoT interfaces, banks and credit unions are testing the acceptance of banking via these devices.

Leading Banks Make Login and Enrollment Easier

Best-in-class banks make it easy for customers to enroll in mobile banking and to login to their mobile banking account. According to Forrester, Chase and Citi provide strong pre-login capabilities as well as accessible security and privacy content. According to Forrester, “Leading banks provide mobile experiences that feel familiar for customers who are used to the bank’s PC-based secure website, while balancing convenience and security.”

The study believes that financial organizations must allow consumers to register for digital banking directly from their mobile devices as opposed to forcing them to sign up for online banking first. The requirement for consumers to first have an online banking relationship is still the norm, but not in alignment with the influx of mobile-first consumers.

Understanding that consumers don’t need to be logged in for every banking task (especially some of the most used tasks), each of the largest US banks now offer the option to see account balances without logging in. While this capability is now offered by the largest organizations, the importance of pre-login features may decrease as fingerprint, voice and other authentication methods replace passwords and codes. All five of the banks reviewed now offer fingerprint authentication on their mobile banking apps, using Apple’s Touch ID for iOS apps.

The importance of making the login process as painless as possible without compromising security is an ongoing challenge. Most leading banks accomplish this by using multifactor authentication the first time customers use the app and then let them use a simplified login for subsequent usage.

One of the drawbacks to continuously providing enhancements to mobile banking is that consumers may become confused with new updates. Similar to what is done with non-financial applications, Forester recommends that banks and credit unions communicate improvements and guide new users through the mobile banking app upon enrollment.

Money Management and Customer Support Tools Lacking

While most leading institutions provide easy access to common tasks and recent transactions, a predictive view of the future is still lacking by the majority of organizations according to Forrester. This is an area where challenger banks in the US such as Simple and Moven excel, as do many of the challenger organizations overseas.

Forrester also found that embedded contextual money management tools were also lacking at most institutions. An exception was noted by Wells Fargo, where the bank’s ‘My Spending Report’ provides monthly averages and money management graphics within the mobile app.

Finally, as more consumers use a mobile device as their primary method of conducting daily banking, the ability to initiate basic requests such as notification around travel, fraud or a lost card is still not widely available. In addition, the ability to receive contextual help and conduct natural language search is still lacking at many organizations. And while basic alert capabilities are offered by most institutions, the ability to customize a wide range of alerts is not as common.

Mobile Cross-Selling Underutilized

The ability to leverage customer insights to drive contextual offers and the ability to cross-sell within the mobile banking app remains an untapped opportunity at most banks and credit unions according to Forrester. “Too few banks use the context of a customer’s current product portfolio, recent life events, physical location, past behavior, or other factors to offer personalized marketing in their mobile apps,” states Forrester.

Another missed opportunity for many organizations is the ability to research and compare product offerings within the mobile application. Since most mobile banking customers begin their shopping on a mobile device, the addition of this capability will be more important in the future.

One of the biggest opportunities (and shortfalls) at the vast majority of financial institutions is not having the ability to open a new account entirely on a mobile device. The requirement to go to a physical office to complete an account opening is the most likely reason for application abandonment. A notable leader with mobile account opening noted by Forrester is Bank of America, where a customer can apply for multiple accounts directly from their mobile app, prefilling the application to simplify the account opening process.

The Importance of Monitoring Mobile Banking Innovations

Beyond a ranking of the mobile banking offerings by the largest banks, the Forrester 2016 Mobile Banking Functionality Benchmark provides an excellent overview of some of the best mobile banking innovations by the banks analyzed. These new capabilities provide a guide for other financial institutions to follow who are trying to keep pace with the marketplace and satisfy an increasingly demanding consumer.

According to Forrester, “To win and retain mindshare and wallet share, digital banking teams need to focus on using mobile banking not only to meet customers’ needs but also to create new sources of value. To fend off the disruptive forces of disintermediation and commoditization, mobile banking must evolve to become a platform for customer engagement.”

In addition to watching the largest banks in the marketplace for innovations that improve the mobile banking consumer experience, it is also important for banks and credit unions to continuously monitor the offerings of challenger banks in the US and overseas. For instance, Simple and Moven have been recognized as the best-in-class by the PYMNTS Digital Banking Tracker™ for strength in account management, money management, payments, engagement and security capabilities. Many of the offerings by these challenger banks provide superior capabilities to even the largest banks.

About the Forrester Benchmark Study

Forrester conducted its 2016 Mobile Banking Functionality Benchmark evaluation of the mobile banking apps of the five largest banks between February 17 and March 22, 2016. The methodology involved scoring each of the top five banks’ mobile offerings across 40 criteria. As much as possible, Forrester used an iPhone for criteria focused on firms’ smartphone apps and mobile websites. The organizations reviewed included Bank of America, Chase, Wells Fargo, Citi and U.S. Bank.

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