Tag: banking mobile

Mobile banking could be the end of hundreds of brick and mortar branches

According to the research from the UBS investment bank, smartphones could lead to widespread closures.

As a growing number of people start to use mobile banking as a regular part of their interactions with their accounts, it is now being predicted that hundreds of bank branches across Australia may be forced to close.

A survey was conducted by the UBS investment bank and it predicted more than 600 closures.

Analysts from UBS in New York, London, Japan, and Hong Kong partnered up with KPMG in order to produce a massive 54-page report that it has now published and released. Within it, 67 different bank management teams were surveyed across 18 different countries. Among them, there was an average expectation of a branch reduction of 5.6 percent as a direct result of the rise of mobile banking use.

That said, in Australia, that figure is predicted to be about twice the average of closures from mobile banking strategies.

Mobile Banking - Image of Automated Teller MachinesThe report showed that despite the fact that Australia has seen a steady number of bank branches for quite a long time, the survey respondents feel that the country will be facing an 11 percent closure rate as a result of banking over smartphones and other mobile devices.

Based on June 2014 data from the Australian Prudential Regulation Authority, there were 5483 bank branches in the country at that time. Should the predictions of 11 percent be accurate, that would mean that there would be an estimated 603 branch closures across the country.

Because of this fear, many bank branches across the country have worked hard to reconfigure themselves in order to create a much more drop-in style environment and by reducing or removing tellers. This makes it possible for customers to be sold more types of products at their own convenience.

According to the UBS statistics over the span of the next three years, it could easily be that a cumulative reduction of costs by about 10 percent, as well as a boost of 6 percent rise in bank revenues. Over that same span of time, it is anticipated that there will reach the point that 46 percent of mobile related transactions, which Is an increase over the current 25 percent, and the 13 percent from 2013.

Mobile banking is being used, but this is only the beginning

More than half of smartphone owners in the United States currently use this type of app and service.

According to recently released survey data from the Federal Reserve and an analysis conducted by Business Insider, about half of all smartphone owning American adults are now using mobile banking in some form, but at the same time, there is still a long way to go before it can be considered to be truly mainstream.

Among the general population, not just smartphone owners, the uses of these services is considerably lower.

The data showed that in 2013 the percentage of American smartphone owners who were using mobile banking services was about 51 percent. By the same time the next year, it had risen to only 52 percent. While it is growing, and while this does mean that more than half of all of these individuals users are also taking advantage of these services, it shows that the rate of growth is very slow and there is still a great deal of room for this type of usage to improve.

The fastest mobile banking penetration growth is occurring more quickly specifically among smartphone users.

Mobile Banking - American Smartphone UsersThe general population may not be seeing a rapid growth, but when taking a more focused look at the people who actually have the devices, there was a rate of increase of 6 percent, compared to the tiny 1 percent seen by the general population.

When looking at American adults who have bank accounts, regardless of whether or not they were smartphone owners, there was a 5 percent increase in the use of banking services over mobile devices. Across the entire American population, the penetration of banking over mobile devices reached 34 percent in 2014.

It was pointed out that it is very unlikely for feature phone owners to try to use mobile banking services will see much of an increase. The reason is that banks have not been releasing the types of apps that would be usable in feature phones, when the population is rapidly making the transition over to smartphones and the vast majority of device owners have that specific type of cell phone.