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Mobile banking is set to surpass online banking in the UK
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Mobile banking apps are expected to become more popular than online banking platforms among UK consumers by 2019, according to a CACI study reported on by BBC News. This prediction is reinforced by the fact that the number of online banking logins, as well as online banking users, is decreasing.
BI IntelligenceThe study predicts a major uptick in mobile usage in the next five years:
More than half of UK consumers will be using a mobile banking app. Twenty-two million adults in the UK managed their bank accounts using mobile banking last year, and the study predicts that 35 million, or 72% of the UK's adult population, will use mobile banking apps by 2023.
Consumers will only visit a physical bank branch twice a year. While many consumers in urban areas already use mobile banking, the study suggests that the biggest increase in mobile banking users will be seen in rural areas, likely because many of those consumers may not have access to physical bank branches. Using mobile banking apps could be a convenient alternative for rural consumers, especially since there are an increasing number of apps to choose from.
Mobile banking trends differ in the US, as many consumers still prefer physical branch visits.US consumers are also increasingly reliant on mobile banking channels: 46% of US consumers have increased their mobile banking usage in the last year, according to a Citi study.
And, although the US banking industry saw a record-breaking 1,700 branch closures in 2017, banks are still a very important resource for customers. For example, 60% of US consumers prefer to open a new acount at a bank branch, rather than digitally, largely because they want the option to see an employee about any issues that may arise.
US banks have started to recognize that preference and adapt their strategies accordingly. Major US banks have started realigning their strategies to cut branches in less lucrative, rural locations, while expanding branches to cities they didn't previously have locations in.
Chase is investing $20 billion in a five-year initiative to open up 400 new branches, and Bank of America is opening 500 new branches, while also testing humanless hybrid branches that engage consumers digitally while cutting costs for the bank.
Likewise, banks in the UK, which have also begun shuttering branches — the Royal Bank of Scotland announced it will close 162 branches — might need to consider hybrid branches or other solutions that can accommodate consumers who still prefer branch banking, despite the widespread mobile banking trend.
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