.Embracing technology is no longer a luxury for banks wanting to stand out in an increasingly competitive landscape that no longer belongs to just traditional financial institutions.
With the likes of Google LLC and Apple Inc. making forays into the consumer banking space, many U.S. banks are stepping up their game when it comes to translating technological innovation in theory into optimal customer experience in practice. Mobile bank apps are one window into how this is happening. S&P Global Market Intelligence's 2019 US Mobile Banking Market Report includes mobile banking survey data and mobile app details for 27 national and large regional banks, as well as for 45 institutions with less than $50 billion in assets spread across the nine U.S. census divisions.
Click here to read the full 2019 US Mobile Banking Market Report.
All of our survey respondents had used the mobile bank app for their primary financial institution in the preceding 30 days, but many of them also engaged with their bank in other ways.
People who used their mobile bank apps at least once daily were more likely than less frequent users to engage with their bank via phone or chat. Even frequent users of mobile bank apps seem to want more than self-service channels when it comes to handling their personal finances. That can mean a variety of ways to quickly ask questions or get help from customer service. About 7% of our survey respondents said they had switched banks in the prior year. The most commonly cited reason for switching was the pursuit of better customer service, followed by lower fees and a more convenient branch network.
People of the millennial generation or younger were less likely than older respondents to visit a bank branch; even so nearly half of respondents from the younger age groups had made at least one branch visit in the preceding month. And fewer branch visits did not mean that younger people were necessarily self-sufficient. They were more likely than older respondents to engage with customer service at their bank on the phone or via chat. The branch still matters to mobile bank app users, even to people who do business with a branchless banking platform. More than 10% of our survey respondents said they have an account with a digital-only bank, but clearly branchless banking did not meet all their needs. Almost a third of the branchless bank account holders in our survey said they had visited a bank branch in the previous month.
More than two-thirds of the branch visitors in our survey spoke with a teller or banker while they were there, as opposed to making a visit solely to use the ATM. An important question for many banks is how much of what is happening in the branch or on the phone could happen more efficiently via self-service digital channels instead. And when customers do come to branches, banks want to turn that visit into an opportunity for greater engagement and deepening the customer relationship.
Various banks do that by linking technology and the branch. That can mean something as simple as having iPads in the branch for customers to use in exploring various product offerings, or it can involve linking the branch experience to the mobile app experience, such as by allowing customers to schedule branch appointments through the app. Scheduling branch appointments is not a common feature in mobile apps, with less than half of the big banks in our analysis offering this feature and only about 15% of the regional banks we reviewed offering it or planning to roll it out.
Our survey respondents identified the most valued features of their mobile bank apps, with fairly basic features such as checking balances, reviewing transactions and transferring money coming out on top. Almost two-thirds of our total survey respondents identified mobile features that they did not see in their current bank apps that they would like to have. More than a third of them said they would be interested in switching to a bank that offered such features. Fingerprint login, credit score information and card controls emerged as the most-desired missing features.
Many of the nation's largest banks are tough to beat when it comes to offering feature-rich mobile apps. Companies such as Bank of America Corp., Wells Fargo & Co. BBVA Compass and U.S. Bancorp offer nearly all of the mobile app features we looked for.
But packing in more features and trying to be all things to all customers is not the right answer for every bank. Many of the digital product managers we spoke to at smaller regional banks noted the importance of listening to their own customers' feedback, building digital platforms that serve their specific needs and enhancing the digital services they already offer. For example, every bank whose app we examined offers photo check deposit and mobile bill pay. But some banks are trying to take that a step further. Examples include giving small business customers more immediate access to deposited funds so they can meet payroll or by customizing mobile deposit limits for different categories of customers.
Methodology
The mobile banking survey was fielded online between Feb. 15 and Feb. 27, 2019, across a nationwide random sample of 4,000 U.S. mobile bank app users 18 years and older. Results have a margin of error of +/- 1.6% at the 95% confidence level based on the sample size of 4,000. Survey results presented for the entire U.S. are weighted by geography to be nationally representative. S&P Global Market Intelligence researched mobile bank apps between June and November 2019 for more than 70 financial institutions. These included large national retail banking franchises in the U.S., regional banks of various sizes and a few large community banks. The analysis included each census division’s top five retail deposit market share leaders with assets under $50 billion. The app research is based on product descriptions available on bank websites and in app stores, as well as company-provided information. Some companies may have subsequently updated their apps or may offer additional features and services. This analysis does not necessarily reflect functionality or services available through text banking, mobile browsers or secure messaging.
Ryan Kim and Celeste Goh contributed to this article.