As consumers abandon traditional bank branches in favor of mobile platforms at breakneck speed, financial institutions are enhancing their mobile offerings at a comparable pace.
In a recent presentation, Consumer Financial Protection Bureau Director Richard Cordray said that one-third of cell phone users and more than half of smartphone owners are using mobile banking services.
The director cited data indicating that roughly 74,000 consumers per day began using mobile banking services last year.
The CFPB recently issued a request for information on a number of mobile banking services and on the use of mobile financial systems by consumers and potential benefits for underserved consumers.
Responding to the CFPB’s request was the Federal Trade Commission. The FTC’s comments addressed a number of issues including the privacy and security of consumers’ personal and financial data. They also discussed the potential use of consumers’ information by data brokers and other third parties.
Bank of America Corp., which touts 15 million active mobile banking customers and 200,000 more signing on each month, conducted a survey earlier this year on 1,000 respondents. The findings were discussed in the report, Trends in Consumer Mobility Report.
More than a third of those surveyed indicated that they constantly check their smartphones, while 85 percent check it a least a few times a day. Among people between the ages of 18 and 24, more (96 percent) consider phones more important than anything else — including cars, internet or personal hygiene items.
Among BofA’s customers who use mobile banking applications — 82 percent use it at least once weekly. Eighty-one percent use it most frequently to check their balances, while nearly half use it to transfer funds and almost that share use it to pay bills.
The American Bankers Association has filed a petition with the Federal Communications Commission asking for the removal of regulatory restrictions on automated calls and texts to mobile devices. Specifically, ABA wants banks to be able to send mobile notifications alerting customers to potential fraudulent activity.
The trade group noted that while the rules were designed in an era when everyone had a landline, roughly 40 percent of U.S. households are now wireless-only. In addition, almost 60 percent of consumers prefer to be notified on their mobile phones about potential fraudulent activity.
“Effective fraud prevention requires the earliest possible contact with the customer,” ABA President and Chief Executive Officer Frank Keating said in the statement. “Automated text and voice message calls to mobile phones can reach people wherever they are, enabling customers and financial institutions to react promptly to stop fraudulent transactions and respond to data security breaches.”
ABA recently published the results of a survey that found mobile banking is the preferred banking method of 10 percent of consumers, growing from 8 percent last year. The survey was conducted on a thousand adults in August.
Bank-holding company Customers Bancorp Inc. recently noted that products from all of its operating entities, including Customers Bank, will be available for the new iPhone 6. The Wyomissing, Pa., company additionally noted that Customer Bank debit cards will be tokenized with the Apple payment application by the fourth quarter.
BankMobile from Customers Bank, which is targeted at tech-savvy millennials, will officially launch in phases beginning in the fourth quarter.