Modern Banking Experiences Go Beyond Mobile

Modern Banking Experiences Go Beyond Mobile

May 30, 2024

By: Tyler Brown

Data and Customer Experience

The difference between the number of consumers who use the online vs. mobile channel to manage their bank account(s) is stark, according to a study by the American Bankers Association. Twenty-five percentage points more consumers used mobile than online, and that difference rose to 46 percentage points for both millennials and Gen Zers.

The 46-point gap should remind bankers how crucial mobile banking is to attract, retain, and engage consumers aged 18 and 43 — a cohort that gets more earning power every day. A retail bank can’t afford to do without a mobile app that manages basic financial products like checking accounts and credit cards. Beyond that, more sophisticated functionality is important as younger consumers’ finances grow more complex.

Banks need a channel strategy that anticipates these consumers’ behaviors, expectations, and needs over time and in any context. The dominance of mobile highlights three initial investment priorities:

  • Apps. Today’s menu-driven mobile banking apps are increasingly rich in features, and bankers shouldn’t skimp on functionality. Achieving a competitive set can be a long road, but it’s also the baseline for the next generation of tools. Tomorrow’s apps may, for example, have artificial intelligence-driven experiences that respond to user behavior and replace menus with dynamic suggestions.

Two priorities go beyond the bank’s app:

  • Platform integration. Smartphones create a natural payments experience using features built into the device and the operating system. The bank doesn’t control that experience. But by making its products compatible with a platform’s features, like a mobile wallet, the bank can be the preferred payment choice and stay top of wallet when a consumer uses the device for a transaction.
  • Omnichannel journeys. Mobile can complement rather than compete with physical channels. The use of offline channels for managing a bank account is low, but the branch and ATM are ancillary services. Basic omnichannel may be as simple as offering ATMs that work with the phone’s tap-to-pay feature instead of a card.

As we wrote last week, consumer demand gives banks a strong incentive to invest in the customer experience. Mobile is just part of it. Banks naturally should offer an app and take advantage of smartphone features, but a truly modern approach goes beyond that. Serving customers well in the long run depends on the real-time integration of services across a bank’s products, including customer data held in different siloes.

A bank’s goal should be to have holistic customer data in real time to support responsive, relevant experiences. Few tech stacks are well-equipped to overcome data siloes, and putting off that problem means falling behind. Gradual migration is a likely solution, but it’s a very long journey that takes strong commitment from the board and senior management.