Mobile banking apps have become table stakes for banks and credit unions, especially among Millennials and Generation Z. Research from MX earlier this year indicated that a decent mobile banking app is a must-have for nearly one in four consumers starting a relationship with a financial institution.
MX research also shows that 80% of consumers have a payment app, such as Venmo, PayPal or Cash App on their phone. In addition, 77% have a bank or credit union mobile banking app, 48% have a credit card app, 25% an investment or retirement savings app, and 17% an independent app to help manage their finances. Nearly half maintain three or more financial apps on their devices.
Now a new round of MX research indicates that the quality of the mobile banking app offered by a consumer’s banking provider can be the basis of a tighter relationship — or break the inertia that traditionally kept unhappy customers onboard.
MX’s study, “The Missing Link: Where Banks May Be Failing Consumers,” found that 57% of people surveyed said they were either not likely or very unlikely to have an account with a financial provider that offers a bad mobile experience.
“Everyone uses mobile to do their finances in some form or fashion today,” says Jessica Kendall, director of content at MX. “It’s the prevalent medium of choice and you have to have a solid app as a foundation to get consumers — and keep consumers.”
Merely enticing new customers with apps isn’t enough — “wow” doesn’t last long. Today, providers have to keep up innovation to hold onto consumers.
“Simply having an account doesn’t mean they are using the mobile app,” according to the MX study report. “It also doesn’t mean they are using the mobile app if the experience gets worse. 65% of consumers say they would stop using the app if the mobile experience changes for the worse.” [Deep Dive: Offer ‘Test Drives’ of Mobile Banking Apps for a Marketing Advantage]
We spoke with both MX about the study’s findings and with Keynova Group about that firm’s latest Mobile Banker Scorecard study, which examines the offerings of 17 major retail banking providers.
Mobile Apps Have to Keep Getting Better
“Consumer expectations continue to raise the bar,” says Kendall. “Everyone in the business has an app, but does the app have the right stuff in it and does it work when they need it to?”
One feature many consumers say they want is the ability to pull all their financial relationships into a single app. Many aren’t aware that this is already a common feature, according to Kendall, which suggests a communication problem. (Many also want digital tools for personal financial management. How much they use the tools will be the subject of an upcoming report.)
But even if they are aware that the bank or credit union offers a consolidated view of their finances, consumers want speed. For example: Adding an outside account to the app: 49% expect to perform this task in a minute or less. And 53% of Gen Zers expect the chore to take under 30 seconds, with 15% of Gen Z saying they ought to be able to do it in under 10 seconds. Even among Baby Boomers, 32% expect to do this in under 30 seconds, and 8% in less than 10.
The MX study also found that, by a wide margin, men are more likely to move to another institution if they think their original provider has a subpar mobile banking app. Overall, 63% of men said they’d move, versus 51% of women. [Deep Dive: Can Banks Reverse a Complicated History with Women?]
Meanwhile, 67% of people with an annual household income of over $100,000 would likely seek out a new provider if their institution’s app didn’t measure up.
Read more: Nine Best Practices As Banks’ Online and App Customer Experiences Converge
Delivering Mobile Banking Users Want
The MX study found that four out of five consumers expect their mobile app experience to be consistent with the experience that their bank or credit union offers online. Keynova research over time has found that large providers understand this and have been gradually moving in that direction. The ability to access the same account information on mobile and online is becoming the standard, though mobile requires adaptation to its vertical screen orientation, points out Susan Foulds, managing director.
Foulds says the latest example of this is in how major banks are improving how mobile banking users can work with their debit cards.
“Responding to the increasing use of debit cards at the point of sale and online, together with a growing reliance on mobile banking, banks are working toward providing mobile parity with online banking to offer a similar customer experience through both channels,” says Foulds.
The latest Keynova study found that two areas where institutions are improving mobile app debit card service is in self-service card replacement and control of the card, specifically, resetting the personal identification number and locking the card.
Regarding card replacement, two standouts the Keynova report cites are Citi and Wells Fargo, both shown below.
The Citi app tracks and displays the status of a requested replacement card. The Wells Fargo app adds something that acknowledges the growing use of digital wallets: Once the consumer has made the request for the replacement card, the bank’s app takes them through the process for adding the new card to their digital wallet. In this way they can use the replacement card immediately, before they have the new plastic in their hands.
The ability to lock a debit card via mobile app has become universal among the large players, and seven out of ten also now provide the capability to mobile web users. One area of potential improvement would be enabling users to restrict debit card usage for specific types of transactions. Only 29% of the providers currently allow customers to shut off usage for online transactions, for example. And only 35% of the banks enable users to set daily or per transaction spending limits on their debit cards.
Foulds notes that improving debit card control through apps is a matter of playing catch-up, as apps have generally enabled such controls for credit cards for some time. She says the banks that have introduced debit card controls have generally implemented the same functionality that they offer for credit cards, presenting customers with a familiar interface.
“It’s a win-win when the customer has more control over the debit cards,” says Foulds. “Fewer calls go to the call center. There’s going to be less fraud loss.”
Read more:
- How Bank of America Unified Five Apps Into One Experience
- How American Express Keeps Gen Z and Millennials’ App Preferences in Focus
- Major Banks’ Mobile Apps Evolve into ‘Payment Central’ for Consumers
Expanding Access to Cash Adds Security
More banks are offering the ability to preprogram ATM withdrawals via the debit card part of their mobile banking apps, something that adds convenience plus the control of putting part of the technology in the consumer’s physical control. (ATMs have to be enabled for the mobile app interface, called “cardless ATM access.”) Two out of five institutions offer this capability in some form.
On the deposit side, Foulds suggests that more institutions need to flesh out users’ capabilities with deposits beyond transaction accounts tied to debit cards. She points out that institutions aren’t doing much to enable customers to open CDs and manage them mobilely.
That might seem a minor concern, she says, but as more banks trim their branch networks, enabling more mobile interaction for CDs provides entrée to more depositors.
Without such features, says Foulds, “You’re not going to capture CD customers if they’re outside of your physical footprint.”
Read more: How Virtual Assistants Take Mobile Banking Apps to the Next Level