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Growing Mobile App Users Prompting Banks to Close Branches

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Published on : Oct 08, 2015

The popularity of online banking is growing rapidly. In online banking, there is emergence of mobile banking. Banks around the world are increasingly launching mobile apps that help users to perform banking transactions with ease. Furthermore, banks are also updating these mobile apps to provide users with additional features such as paying their bills and scheduling their transactions.

With growing advancements in technology, banks that have online mobile apps are spending heavily on security measures and other safety awareness initiative. Another key trend that the online banking world is now witnessing is that the growing popularity of mobile banking apps has led to decreasing use of physical banks. Hence, many banks are contemplating to close their branches with the growing number of mobile app users.

Bank of America amidst the dramatic adoption of mobile banking has now decided to trim its physical branch count. According to statistics from the Quarterly Financial Supplements of Bank of America, the bank has now closed more than 900 of its branches in the past four years due to the growing number of active mobile banking accounts. The number of active users that are using mobile banking is just under 10 mn, which equates to around 130 per cent growth.

Even though many other banks are now contemplating the idea of expanding their branch networks, there is still a little question that says that digital banking will soon represent the future of financial services.

However, digital and mobile banking now offers a challenge to several troubling developments. The amount charged to deposit a transaction a bank costs around half a dollar and the cost has now fallen to less than US$0.08 for each transaction when conducted in an ATM. Hence, consumers that deposit checks using a mobile app can complete transaction for a very cheap price