The Rising Popularity of Mobile Banking
According to an annual survey by the Federal Reserve, 43% of adults used their phones for financial activities last year, an increase from 39% found in the Fed’s 2014 survey. 77% of consumers made mobile payments last year, which is up from 71% in 2014.
The rising popularity is due to the fact that customers can make mobile payments and check account balances from their mobile device. Consumers are also using their hand-held devices to communicate with their bank, as more than half of the survey respondents have received alerts from their bank via push notification, text or email.
The survey also showed mobile banking is starting to be used in lieu of traditional banking services. While mobile is still behind online banking (65%) and ATMs (62%) as “the most important way” customers interact with their financial institution, it did rank ahead of using branch tellers for third place.
The people on the forefront of mobile banking tend to be younger and more diverse. The survey found younger adults, Hispanics and African Americans use these services more often than the general population.
Consumers do still have a few concerns about mobile banking, though. Many are worried about “the security and privacy of personal information.” However, customers have started to take charge of their own security by staying on top of software updates (84%) and using password protection on their mobile devices (70%). More than half of the respondents customize their privacy settings (58%).
Americans also seem to be more aware of potential security threats and adjust their behavior accordingly. 78% said they do not download or install apps from outside their official app store, and 76% said they do not send or access sensitive data over public WiFi.
The survey was conducted online between November 4 and November 23, 2015.