What Customers Would Want from a Mobile-Only Bank
With FinTech companies and services becoming a regular part of our lives, those who would have never considered using an internet exclusive bank now find themselves signing up for accounts. This is not only because of technological advances that reduce the need for customers to visit physical banking branches but also due to the better interest rates and other incentives that such banks can offer. So can this strategy that has worked well for internet-only banks be applied to attracting consumers to yet another new banking medium?
An international study recently conducted and released by Nielsen sought to assess how likely users were to be swayed by a mobile-only bank. First it seems that some sort of incentive would be necessary to woo most customers as only 19% of those in North America said they’d be highly likely to use a mobile-only bank. Another 30% say there are somewhat likely, although the majority (51%) say they’re against the idea.
When separated by age range those figures do change significantly. In fact, when it comes to Millennials, the numbers are practically inverted with only 19% of those 21 to 34 years old saying they were unlikely to go with a mobile-only bank compared to 34% who were highly likely to. Somewhat surprisingly those numbers were higher than the youngest generation looked at — the so-called Gen Z, ranging from 15 to 20 years old in this study — where only 23% were all in on mobile banks compared to 30% who were against. Aside from that discrepancy, feelings toward mobile-only banking seemed to sour with age as two-thirds of those over 65 said they were not likely to give such banks a shot.
So how can mobile-only banks change consumer minds? The incentive with the strongest “highly likely” score was the idea of offering lower or even fee-free investment products, which 43% of respondents said they’d be very interested in. However there is also strong support for a bank that offered quicker turnaround times on transactions. Only 8% of people said that idea was unlikely to change their minds — the lowest percentage in that category among other proposals. Other popular ideas included offering exclusive discounts on entertainment and better interest rates on deposits, both of which were “highly likely” to lure 42% of respondents.
Just as internet banks took a while to catch on, mobile-only banks still have an uphill battle to fight. However, as consumers become more comfortable with finance apps and completing transactions on the smartphones in general, the favorability such banks enjoy promises to rise. Still it’s interesting to know exactly what features potential customers are looking for in a mobile bank in order to incentivize them and spur adoption. Likewise other FinTech ventures can learn from these insights and begin to knock down barriers that prevent more people from getting on board with new ways of managing their money.