What's Closing Bank Branches Faster Than The Fdic?

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If you’ve heard it once, you’ve heard it a million times: mobile banking is going to change the banking industry. Sure, it won’t be overnight. But from all of the research I’ve seen, it won’t take long.

I recently spoke at a Jack Henry Banking Educational Conference, where I held up my iPhone and asked everyone what it was. As you can image, they all answered, “a phone.” I then let them in on a big secret. What I was really holding up was a bank branch.

A bank branch that I, the user, paid for and not the bank!

Think about it. As a banker, how would you like to have a bank branch that your customer pays for and spends 24 hours a day with? You don’t have to pay for a building, vault, coffee, cookies, pens, paper or people. And every purchase they make, you are right there with them.

Does this sound like a dream come true?

But the real question is this: Whose bank branch will it be? Will it be yours or your competitor’s? Will it even belong to a bank? Maybe it will belong to a telephone company, internet company, or even an insurance company.

I can’t tell you exactly where the market is going, but I can guarantee you one thing: Unless you start offering mobile banking now and learn how to effectively market it, it won’t be your bank in your customers’ pockets.

People are creatures of habit. Once they begin using mobile banking from one company, it will be hard to get them to switch. So instead of spending millions on bank branches, invest a little in mobile banking. Recruit a young marketing person who lives on a mobile device – someone who can show you the future.

According to comScore, Inc., some 32.5 million Americans accessed mobile banking information on their devices at the end of June, representing 13.9% of all mobile users. The study also revealed that 12.7 million mobile users used banking apps, a notable increase of 45% from the end of 2010.

An analysis of credit card customers’ engagement with various account channels shows users reporting more frequent access through mobile channels than fixed-line computers, with 62% of credit card customers using an app to visit a bank’s website at least once a week. Another 52% percent reported checking-in with the same frequency via a mobile browser.

In comparison, only 34% of users checked-in to their accounts with the same frequency from a fixed-line computer.

“While mobile channels have not reached the same penetration that traditional online channels have for the use of financial services, it is interesting to note that mobile users access their credit card accounts on a more frequent basis,” says Sarah Lenart, comScore vice-president for marketing solutions. “As users continue to incorporate the use of these devices into their everyday lives, financial services institutions can expect to see a more engaged audience grow from their mobile channels.”

One of the many features on mobile phones includes SMS messaging or “texting.” Since this messaging is immediate, banks could use it to alert customers that they have a low balance and could experience an overdraft or that there has been suspicious activity on their account. Your bank could also promote a new higher rate CD or money market account for FREE!

With GPS technology on many mobile phones, retailers can alert customers that they are near one of their retail locations and offer a special promotion that allows the customer to place an order and pay for it instantly. (Hopefully, they’ll pay for it using your bank’s mobile banking application!)


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