Mobile Payments Lag Behind Mobile Banking, Study Finds
A new report states 14% of all respondents had “no plans to offer” mobile banking.
About one in five financial institutions still do not offer mobile banking and 43% do not offer mobile payments, according to research published this fall by the Federal Reserve Bank of Boston.
The five-question “Quick Hit Mobile Financial Services Survey” (QHS) of 565 financial institutions — including 178 credit unions — found that 82% of respondents offered mobile banking. In addition, 14% of all respondents had “no plans to offer” mobile banking, the report said.
Of that 14%, all but one of those institutions had less than $500 million in assets, the FRB report authors noted.
“The recent QHS findings underscore the increasing number of FIs that are experiencing greater customer use of their mobile banking services,” they added. “Among the 405 FIs that provided retail customer usage data, only 5% of respondents have very low (i.e., ‘<5%’) customer usage rates, while 69% have customer usage rates between 5% and 35%. Notably, 13% (52 FIs) reported that more than 50% of their retail customers use their mobile banking services, and another 13% (53 FIs) reported usage in the ‘36-50%’ range.”
However, mobile payment offerings lagged behind mobile banking services among financial institutions of all sizes, according to the data.
More than half (57%) of respondents currently offered or planned to offer mobile payments, but 20% had no plans to do so and 23% were undecided about offering mobile payments in the next year.
Only 17% of the respondents that said they had no plans to offer mobile payments and 14% of the undecided financial institutions had less than $250 million in assets.
“From a broader perspective, the QHS highlights how participation from small banks and credit unions in surveys of this type can add to the industry’s knowledge base and benefit the smaller FIs by helping them understand how both peer and larger FIs are approaching mobile services,” the report said. “The QHS and, especially, the more comprehensive MFS survey, are good tools for FIs to gauge where they stand relative to other FIs and gain useful information to enhance their mobile strategies.”