The mobile banking landscape is constantly evolving, driven by technological advancements. By the time, it has changed consumer demands, and the emergence of innovative financial services. In today’s fast-paced digital world, mobile banking has become an indispensable tool for many tasks, such as managing finances, making payments, and accessing financial services anytime, anywhere.
As we move forward, it’s crucial to stay ahead of the curve and understand the latest mobile banking trends that are surely shaping the future of financial interactions. This article delves into the top 7 mobile banking trends that are worth keeping an eye on, as well as highlighting their potential impact on the way we interact with our finances.
Table of contents
1. Introduction to Mobile Banking App
Mobile banking, also known as m-banking or mobile financial services (MFS), is an electronic banking service that allows customers to access and manage their bank accounts from a mobile device, such as a smartphone or tablet.
1.2. Benefits of Mobile Banking App
- Accessibility: Mobile banking is accessible from anywhere with an internet connection, eliminating the need to visit a physical bank branch. This makes it convenient for people on the go or living in areas with limited branch access.
- Speed: Mobile banking transactions are typically completed faster than in-branch transactions. This is because there is no need to wait in line or deal with paperwork.
- Ease of use: Mobile banking apps are typically user-friendly and intuitive. It is easy for people to learn how to use them. This allows people to perform a variety of banking tasks, such as checking account balances, transferring funds, and paying bills, from the convenience of their smartphones or tablets.
- Cost-effectiveness: Mobile banking is often free or less expensive than in-branch banking. This is because there are no fees associated with using mobile banking apps. Moreover, banks may offer discounts or waive fees for certain mobile banking transactions.
- Security: Mobile banking apps use advanced security measures to protect user information and transactions. This includes multi-factor authentication, encryption, and fraud detection.
2. Top 8 Latest Mobile Banking Trends
2.1. Open banking
Open banking is a framework that enables third-party financial service providers to access customer financial data with their consent, through secure APIs. The shared data often includes financial transaction history, account authentication, payment link… After being collected, the data is then analysed for customer behaviour and consumption habits. This allows the development of innovative financial products and services to be integrated into mobile banking apps.
Without a doubt, open banking is a significant trend in mobile banking. Many mobile banking apps are now integrating open banking features. This allows users to connect their accounts with third-party providers and access personalised financial insights and services. This trend is likely to continue. This is because open banking becomes more widespread and consumers demand more personalised and convenient financial management tools. MoMo, a Vietnamese e-wallet provider, has partnered with several banks to offer open banking features. This allows MoMo users to access their bank account balances and transfer funds within the MoMo app.
Benefits of open banking
- Increased choice and competition: Open banking can lead to the development of new and innovative financial products and services. This gives consumers more choice and driving down costs.
- Personalised financial insights: Open banking can allow third-party providers to develop personalised financial insights and recommendations based on a customer’s financial data.
- More convenient and efficient financial management: Open banking can make it more convenient and efficient for consumers to manage their finances. It is conducted by aggregating their data from multiple sources and providing a single view of their financial situation.
- New revenue streams: Open banking can create new revenue streams for businesses by allowing them to develop innovative financial products and services.
- Improved customer engagement: Open banking can help businesses to improve customer engagement. It provides them with personalised financial insights and recommendations.
- Reduced costs: Open banking can reduce costs for businesses. Because it help them streamline financial processes and reduce the need for manual data entry.
2.2. Artificial intelligence (AI)
AI (Artificial intelligence) is apparent in almost every industry in the world. So, it is obvious that it is a significant trend in the mobile banking sector. Here are some specific ways of how people apply AI in mobile banking apps:
- Chatbots and conversational interfaces: Chatbots and conversational interfaces provide customer support, answer questions, and personalise financial recommendations. For instance, users can ask the chatbot to check their account balance, transfer funds, or provide insights into their spending patterns.
- Fraud detection and prevention: AI can help people analyse user behaviour and transaction patterns to identify and prevent fraudulent activities. AI algorithms can detect anomalies and suspicious patterns that may indicate fraudulent activity. It allows banks to take proactive measures to protect their customers’ accounts.
- Personalised financial insights and recommendations: AI is being used to analyse user data and provide personalised financial insights and recommendations. This can include tailored budgeting suggestions, investment advice, as well as savings goals.
- Risk assessment and underwriting: AI can assess credit risk and underwrite loans and other financial products. AI algorithms can analyse a wide range of data. For example, they are credit history, income, and employment information, to make informed decisions about lending.
- Voice banking and natural language processing (NLP): Bank can use AI to power voice banking features. To illustrate, banks would allow users to interact with their bank accounts and perform transactions using voice commands. NLP enables AI systems to understand and interpret human language. So that it provides a more natural and intuitive way to interact with financial services.
Benefits of AI in mobile banking
AI is transforming the mobile banking landscape by providing a range of benefits to both users and banks:
- Enhanced user experience: AI-powered features like chatbots, personalised recommendations, and voice banking, making mobile banking more convenient, intuitive, and user-friendly.
- Improved security: AI algorithms can detect fraudulent activities more effectively, protecting users’ financial information, as well as reducing the risk of fraud.
- Personalised financial insights: AI can analyse user data to provide personalised financial insights and recommendations. Hence, it helps users make informed financial decisions and achieve their financial goals.
- Reduced costs and operational efficiency: AI can automate tasks and streamline processes, reducing costs and improving operational efficiency for banks.
- Increased innovation and personalisation: AI enables banks to develop innovative features and services that are tailored to individual user needs and preferences.
Blockchain technology is emerging as a significant trend in mobile banking, with the potential to transform mobile banking.
- Cross-border payments: Blockchain can facilitate faster, more secure, and cost-effective cross-border payments. It eliminaties intermediaries like correspondent banks and reducing settlement times. This can be particularly beneficial for migrant workers sending remittances home or businesses conducting international transactions.
- Trade finance: Blockchain can streamline and secure trade finance processes, such as letters of credit and bills of lading. It provides a tamper-proof and transparent record of transactions. This can reduce paperwork, errors, and disputes, saving businesses time and money.
- Identity verification: Blockchain can be used to securely store and manage digital identities. For this reason, it enables users to verify their identity without the need for physical documents. This can simplify account opening processes and improve access to financial services for individuals without traditional forms of identification.
- Smart contracts: Smart contracts, self-executing contracts encoded on the blockchain, can automate certain financial transactions. They reduce the need for manual intervention and improving efficiency. For instance, smart contracts can automate payments upon the fulfilment of certain conditions, such as delivery of goods in a trade transaction.
Benefits of blockchain in Mobile Banking
- Enhanced security: Blockchain’s decentralised and immutable nature provides a secure and transparent record of transactions. Consequently, it can reduce the risk of fraud and errors.
- Improved efficiency: Blockchain can streamline financial processes, reducing settlement times, as well as operational costs.
- Increased financial inclusion: Blockchain can expand access to financial services for unbanked and underbanked populations, particularly in developing regions.
- New financial products and services: Blockchain can enable the development of innovative financial products and services, such as decentralised exchanges and tokenized assets.
While blockchain adoption in mobile banking faces challenges, such as regulatory uncertainty and scalability concerns, the potential benefits are significant.
2.4. Biometric authentication
Biometric authentication is a security technology that uses unique biological characteristics of an individual to verify their identity. These characteristics can include fingerprints, facial features, iris patterns, voice patterns, and even the way a person walks.
Biometric authentication is becoming increasingly popular in mobile banking as a way to protect user accounts from unauthorised access. At the present time, many mobile banking apps offer fingerprint authentication, and some even offer facial recognition and voice authentication. The use of biometric authentication is also expected to increase in the coming years. This is because it becomes more widely adopted and as smartphones become more powerful and secure. A successful example of biometric authentication in mobile banking is Apple Pay. This app uses Touch ID and Face ID to authenticate fingerprint and facial recognition for mobile payments.
Benefits of Biometric Authentication in Mobile Banking
- Increased security: Biometric authentication is more secure than traditional passwords, which can be easily forgotten, stolen, or guessed.
- Improved convenience: Biometric authentication is more convenient than passwords, as users do not have to remember or type in passwords.
- Enhanced user experience: Biometric authentication provides a more seamless user experience. So that users do not have to interrupt their banking activities to enter passwords.
- Reduced risk of fraud: Biometric authentication can help to reduce the risk of fraud. This is made by preventing unauthorised individuals from accessing user accounts.
2.5. Contextual banking
The time is now for contextual bankingAntti-Jussi Suominen – Holvi CEO
Contextual banking is an emerging approach to mobile banking. It aims to provide both personalised and proactive financial services based on an individual’s real-time context and preferences. It goes beyond traditional mobile banking by leveraging data analytics, artificial intelligence (AI), and machine learning to understand a user’s current situation, needs, and goals.
With the help of contextual banking, you can access:
- Personalised Spending Insights: A contextual banking app might analyse a user’s recent spending patterns and location data to identify potential savings opportunities or suggest ways to optimise their spending habits.
- Proactive Fraud Prevention: Contextual banking can monitor both user behaviour and transaction patterns in real-time. As a result, it can detect anomalies or suspicious activity, alerting users and financial institutions to potential fraud.
- Tailored Financial Recommendations: Based on a user’s income, expenses, savings goals, and risk tolerance, a contextual banking app can provide personalised investment recommendations or suggest suitable insurance products.
- Predictive Transaction Alerts: Contextual banking can analyse a user’s upcoming bill payments, travel plans, or potential income streams to send proactive alerts and reminders, ensuring timely payments and financial preparedness.
- Location-Based Financial Services: Contextual banking can leverage location data to provide relevant financial services, such as nearby ATM locations, currency exchange rates, or local discounts.
Benefits of Contextual Banking
- Enhanced User Experience: Contextual banking provides a personalised and proactive user experience, anticipating user needs and providing timely financial insights and recommendations.
- Improved Financial Decision-Making: Contextual banking helps users make informed financial decisions by providing tailored advice and recommendations based on their current circumstances and financial goals.
- Increased Financial Wellness: Contextual banking can promote financial wellness by encouraging healthy financial habits, providing personalised budgeting tools, and offering timely financial education resources.
- Reduced Costs and Improved Efficiency: Contextual banking can help financial institutions reduce costs and improve operational efficiency by automating tasks, streamlining processes, and targeting marketing efforts more effectively.
In the dynamic realm of mobile banking, financial institutions are constantly seeking innovative ways to engage users, enhance their financial literacy, and foster positive financial behaviours. Gamification, the application of game-like elements in non-game contexts, has emerged as a powerful tool to transform mundane banking tasks into engaging and rewarding experiences. By incorporating game-like mechanics, such as points, badges, leaderboards, and challenges, banks are able to capture users’ attention, motivate them to adopt healthy financial habits, and ultimately strengthen their relationship with their finances. For example, HSBC’s virtual assistant, “Amy”, engages users through interactive games and quizzes, providing financial education in a fun and memorable way.
Benefits of Gamification in Mobile Banking
- Increased User Engagement: Gamification can make mobile banking more engaging and fun, leading to increased user activity and longer app usage times.
- Enhanced Financial Literacy: Gamification can provide a fun and interactive way to educate users about financial concepts, encouraging them to learn about budgeting, saving, investing, and responsible spending.
- Promoted Positive Financial Behaviours: Gamification can incentivize users to adopt positive financial behaviours, such as setting savings goals, tracking expenses, and making timely bill payments.
- Improved Customer Retention: Gamification can help banks retain customers by creating a more engaging and rewarding mobile banking experience.
- Enhanced Brand Perception: Gamification can foster a positive brand perception, portraying banks as innovative and customer-centric institutions.
2.7. Super apps
In short, a super app is a mobile application that offers a wide range of services, often beyond traditional banking services, to its users. These services typically include payments, messaging, social networking, e-commerce, transportation, and more. Super apps are particularly popular in Asia, where they have become an integral part of daily life for many people.
As financial institutions seek to provide a more comprehensive and seamless user experience, they are increasingly incorporating super app features into their mobile banking platforms. This trend is being driven by several factors, including
- The increasing demand for one-stop-shop solutions
- The rise of mobile-first economies
- The evolution of technology
An example of a super app in Vietnamese mobile banking is MBBank. It offers a variety of functionalities that cater to users’ daily needs, encompassing financial transactions, e-commerce, lifestyle services, and even entertainment.
Benefits of Super Apps in Mobile Banking
Super apps offer a multitude of benefits to users in the realm of mobile banking. Due to this, they can transform the way they interact with their finances and manage their daily lives
- Convenience and Simplicity: Super apps provide a single platform for managing finances, e-commerce transactions, lifestyle services, and entertainment, eliminating the need to switch between multiple apps.
- Personalised Financial Insights: Super apps leverage user data and preferences to provide personalised financial insights and recommendations. For that reason, users can make informed financial decisions.
- Seamless Payments and Integrated Wallet: Super apps incorporate a centralised payment system. It enables seamless and secure transactions across all integrated services.
- Enhanced Financial Inclusion: Super apps can expand the reach of financial services, bringing financial services to underserved communities.
- Data-Driven Innovation: User data gathered from various services can provide valuable insights for financial institutions. This leads to new products, services, and features.
To sum up, the mobile banking landscape is poised for continued transformation as emerging technologies and innovative solutions revolutionise the way we manage our finances. By embracing these latest trends, financial institutions can enhance user experiences, promote financial inclusion, as well as drive growth in the mobile banking sector. As consumers become increasingly tech-savvy and demand more personalised and convenient financial services, mobile banking will surely continue to play a pivotal role in shaping the future of finance.
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