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Mobile banking is in no time going to transform from a niche service for the technological upper-class society to a mass-market service required by all consumer divisions.
While banks extend their plans to give consumers passage to their accounts through smartphones and other mobile gadgets, they should also keep in mind that this rising platform is an inherent stimulus for creating operational efficiencies and as a vehicle for additional revenue origins.
No industry today has been spared from the pandemic in its daily business responsibilities. Even after the banking industry continued to be open to people as an essential industry during the lockdown, it has encountered a permanent transformation that eventually sped up the consumer adoption of mobile banking.
The adoption of mobile banking has peaked since the start of 2019, particularly in young adults.
What is Mobile Banking?
In simple terms, offering numerous finance and banking-associated operations on a mobile device, for example, a smartphone or a tablet, is known as Mobile Banking.
Financial organizations and borrowers have launched mobile banking applications to make the banking experience consistent and stable.
What is the Use of Mobile Banking?
Mobile banking makes it easier for consumers to leverage services outside of essential financial transactions like transferring and getting money. Now you have the opportunity to perform numerous financial investments from term deposits to mutual funds, equity, and also, buy insurance policies. You can also apply for loan requests, pay credit card debts, and repay supermarket and service dues.
Several banks also have links to e-commerce giants and service suppliers to get you rebates and cashback on purchases. It doesn’t matter if you are looking to buy new clothes, enjoy watching a film, or reserving flight tickets, you can quickly route nearly every financial transaction through mobile banking.
How Does Mobile Banking Work?
Mobile banking services run across multiple platforms, including the fundamental service being an SMS service for mobile banking. Consumers can send a request through a predetermined text code to a number defined by a bank, and the bank responds as a consequence.
This feature works with almost all mobile devices, regardless of the mobile device or network transmitter. This is particularly beneficial for individuals who do not have access to smartphones or data usage.
Subsequently, you also have the option called Interactive Voice Response or IVR service. Banks provide a helpline (or customer care)number for customers — generally a toll-free number — which has a set of choices that can be availed in a text-to-speech format. By selecting the numbers on the mobile keypad according to the service you wanted, you can avail those services on your mobile. Nonetheless, an IVR is just for inquiry help.
You also have another service called Wireless Application Protocol (WAP). This is similar to an internet banking system. The benefit of mobile banking through a WAP architecture is: you can avail all kinds of services without downloading any exclusive software.
Lastly, you also have an independent mobile application, which is a profoundly customer-focused and reliable medium that enables you to perform a range of complicated transactions.
Okay, that is all about mobile banking and its use and work. Let’s jump into some of the most important privileges of using mobile banking in 2021:
- It is remarkably simple and straightforward to perform banking transactions from the comfort of your home.
- You can perform transactions and control your account transactions regardless of where you live.
- You can also perform your transactions whenever you want to.
- Unlike the traditional physical bank branches, mobile banking never gets closed at any time.
#2 24/7 Services Availability
- Mobile banking allows you to pick a time unlike bank branches when you want to access your bank account. Barring some exceptions, for example, planned maintenance updates and unexpected outages.
- This 24/7 service availability avoids time consumption for regular banking transactions.
- One feature many mobile banking apps provide is mobile check deposits. With the usage of a remote deposit, customers can deposit their checks from anywhere.
- These days people want to avoid going to the bank branches. It helps you avoid taking in-person risks that many of us have right now.
#3 Lowers the Bank’s Expenses Through Mobile Banking Services
- Encourage paperless work by banks and be environmentally friendly.
- Printing and delivery services can help banks save money.
- No need for additional workers, which eliminates the need to hire.
- Transactions through mobile banking are a lot cheaper than ATM transactions.
- The overall efficiency of mobile transactions is a lot better than regular transactions
- It allows you to save on operational costs.
As per Deloitte research, the cost of mobile transactions is going to be 50 times cheaper than branch transactions, and the cost of ATM transactions is going to be 10 times more economical in the future.
#4 Paying IOUs
- It is easy to pay off to anyone through mobile transactions.
- Send money to anyone in minutes through your mobile banking app instead of paying it back with cash or IOU slips.
- An email address or phone number is all you need to send someone money through your mobile banking app.
#5 Quick Transfer of Funds Between Accounts
- The other benefit of online and mobile banking is that you can transfer funds between multiple accounts that you have in your account.
- If you want to send and receive money from one account to another account you know, then you can do so using a recipient’s email address or mobile number.
#6 Collection of Customer Analytics
- You can collect and analyze the customers’ metrics using your mobile app.
- Provides an option to scale and develop your service and customer experience.
- With an app, you can measure metrics that help banks learn how their users are interacting with their services and why.
- All metrics can be classified into three major groups: customer satisfaction and customer engagement, acquisition, and performance.
- With customer satisfaction and engagement, banks can zero in on the user experience.
- With acquisition metrics, you can monitor the download count and where they are based. This way, banks would know where they should market their campaigns.
- Finally, assessing performance is exceedingly crucial as failures or slow loading can affect the user experience considerably.
#7 Set Alerts
- Mobile banking will assist you in keeping labels on your financial status in all circumstances.
- Mobile banking apps enable you to get immediate notifications whenever there is some activity that takes place on your account which will allow you to set alerts.
- You will be able to personalize these alerts according to customers’ choices.
- Salary being credited, gas bill payments, recharges, or even the deadline for utility payments, you won’t miss out on anything once you set alerts for these payments.
- Mobile banking will also send you timely notifications to pay your bills monthly.
The Significance of Mobile Banking in the Future
These days, without your mobile device, you cannot do anything. This is particularly true when it comes to financial activities. Banks are spending a lot of investment in financial technology to bring personalized interaction with the customer, provide improved security and protection, and launch a number of value-added services that enhance customer satisfaction.
As fintech companies and banks look at the possible use of Artificial Intelligence in the banking and financial sector, mobile banking offers a lot of other services in the future, swiftly and openly.
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Praveen works as a technical writer at Infiniticube. He loves to educate readers on the latest technologies – his expertise includes Artificial Intelligence, Machine Learning, Data Science, Digital Marketing, and Cloud Computing. He has written a few articles on Medium and Forbes. If you are keen to read his other articles, then check him out here.