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Mobile Banking - US - September 2016

Published By :

Mintel

Published Date : Sep 2016

Category :

Banking

No. of Pages : N/A

Consumers increasingly use their mobile devices – especially their phones – to manage every aspect of their lives. However, this reliance has not transferred completely to banking. This Report will examine some of the reasons why this is so and the steps financial institutions can take to increase interest, and ultimately, usage in mobile banking apps. Especially as online-only banks make inroads into the market, traditional banks need to develop apps that can help them compete for the younger and multicultural customers who are most tethered to their mobile devices.

Table of contents

OVERVIEW
What you need to know
Definition

EXECUTIVE SUMMARY
The issues
Security is still a major concern
Figure 1: Reasons for not downloading or using mobile banking app, June 2016
Half of those who tried a mobile app don’t understand it
Figure 2: Mobile banking behavior, by generation, June 2016
The opportunities
Expand benefits of mobile banking
Figure 3: Reasons for not downloading or using mobile banking app, June 2016
Make it easy to open accounts via mobile app
Figure 4: Preference for banking channels, by channel, June 2016
What it means

THE MARKET – WHAT YOU NEED TO KNOW
The challenge of non-banks
Mobile phone sales growth
US demographics will help mobile banking growth

MARKET PERSPECTIVE
The challenge of non-banks
Figure 5: Attitudes toward FinTech innovations, by demographic segment, March 2016

MARKET FACTORS
Mobile phone sales growth is slowing
Figure 6: Total US volume sales and fan chart forecast for mobile phone sales, 2010 -20
Changing US demographics will help mobile banking growth
The Hispanic population is young and growing
Figure 7: Hispanic population, by generation, 2016
Growth of younger generations
Figure 8: Percentage of US population by generation, 2011, 2016, 2021

KEY PLAYERS – WHAT YOU NEED TO KNOW
Banks focus on mobile experience
Mobile apps still not as widely used as expected
Location-based technology
Biometric authentication
In-app marketing

WHAT’S WORKING?
Banks focus on mobile experience
Figure 9: Reasons to increase mobile banking usage, by demographics, June 2016
Biometric authentication
Security – or impression of security – is improving

WHAT’S STRUGGLING?
Mobile apps still not as widely used as expected
Usage by customers of smaller banks is especially low
Figure 10: Mobile banking downloads and use, by type of bank where primary account is held, June 2016
Institutions need to communicate better
Figure 11: Mobile banking behavior, by generation, June 2016

WHAT’S NEXT?
Location-based technology
In-app marketing

THE CONSUMER – WHAT YOU NEED TO KNOW
Checking accounts more popular than savings accounts
Half have not downloaded any mobile banking apps
Smaller banks lag in usage
Security is less of an issue for Millennials
Most consumers need more help with the apps
Branches and computers preferred for some transactions
Security is largest concern, but consumers are looking for help

LOCATION OF ACCOUNTS
Checking accounts more popular than savings accounts
Figure 12: Location of primary account, June 2016
Hispanics more likely than non-Hispanics to prefer national banks for checking
Figure 13: Location of primary account, checking, by Hispanic origin, June 2016

MOBILE BANKING APP USAGE
Half have not downloaded any mobile banking apps
Figure 14: Mobile banking downloads and use, June 2016
Millennials are heaviest users
Figure 15: Mobile banking downloads and use, by generation, June 2016
Young men use mobile banking more than others
Figure 16: Mobile banking downloads and use, by age and gender, June 2016
Mobile banking popular among Hispanics
Figure 17: Mobile banking downloads and use, by Hispanic origin, June 2016
Smaller banks lag in usage
Figure 18: Mobile banking downloads and use, June 2016

REASONS FOR NOT DOWNLOADING APPS
Security is less of an issue for Millennials
Figure 19: Reasons for not downloading mobile banking apps, by generation, June 2016
Women more concerned with security
Figure 20: Reasons for not downloading mobile banking apps, by gender, June 2016
Distrust of security increases with income
Figure 21: Reasons for not downloading mobile banking apps, by household income, June 2016
Challenges for institutions trying to increase usage

MOBILE BANKING BEHAVIOR
Most consumers need more help with the apps
Figure 22: Mobile banking behavior, June 2016
Hispanics are less likely to understand their institution’s app
Figure 23: Mobile banking behavior, by Hispanic origin, June 2016
Blacks are more comfortable with apps than are Whites
Figure 24: Mobile banking behavior, by race, June 2016
Phones are preferred to tablets
Figure 25: Mobile banking behavior, by generation, June 2016
Mobile banking usage is increasing
Figure 26: Increase in mobile banking usage, by generation, June 2016

BANKING CHANNEL PREFERENCES
Branches and computers preferred for some transactions
Figure 27: Preference for banking channel methods, by channel, June 2016
Hispanics more likely than non-Hispanics to use apps
Figure 28: Preference for banking channel methods, by Hispanic origin, June 2016
Apps are preferred over mobile web
Figure 29: Preference for banking channel methods, by channel, June 2016
How mobile banking is used
Large banks focus on transactions
Figure 30: Bank of America and Wells Fargo mobile banking emails, 2016

REASONS TO INCREASE USAGE
Security is largest concern
Figure 31: Reasons to increase use of mobile banking, June 2016
Most older consumers won’t ever use mobile banking
Figure 32: Reasons to increase use of mobile banking, by generation, June 2016
Thoughts about security
Mobile banking as a money management tool
Figure 33: Reasons to increase use of mobile banking, by generation, June 2016
Blacks want texts to help track banking activity
Figure 34: Reasons to increase use of mobile banking, by generation, June 2016
Incentives are important
Figure 35: St. Mary’s credit union online mobile app ad, 2016
Figure 36: Everbank direct mail mobile app ad, 2016

TURF ANALYSIS
Better security most likely to increase usage
Figure 37: TURF analysis – Reason to increase use of mobile banking, June 2016

APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Fan chart forecast
Consumer survey data
Consumer qualitative research
Direct marketing creative
Abbreviations
Abbreviations

APPENDIX – TURF ANALYSIS
Methodology
Figure 38: Table - TURF analysis – Reason to increase use of mobile banking, June 2016

APPENDIX – MARKET
Figure 39: Population by Hispanic origin, 2011, 2016, 2021

List of Table

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