What is Mobile Banking?

The latest craze in banking is mobile banking.  Just about every bank and credit union has a mobile banking app; but what is mobile banking?

Recently, while driving down Kingston Pike, I noticed a competitor had an advertisement outside their branch that read:

Ask about our MOBILE BANKING APPS

Curious about what our competition was offering, I stopped in the branch and asked the customer services representative about their apps.  She had no idea what apps her credit union offered.  She asked the woman working the drive thru, who then clued me in on what apps they offered.

We have one for the iPhone and one for the Smartphone.

I then asked what the other app was since the sign suggested there was more than one app available.  She then informed me that there were two, one for the iPhone and one for the Smartphone.  I then asked her if she meant “Droid” instead of “Smartphone.”  She quickly agreed, and realized that her Credit Union only offered one kind of app, it was just available for two different smartphones.

It may sound like I’m picking on one competitor, but the fact is the term “Mobile Banking” has become so grey that not even people in financial institutions fully understand what it is.  Here’s a quick breakdown:

• Mobile Website: Exactly what it says, when you go to a bank’s website via a smartphone, you see a formatted site specifically created for smartphones.  Typically these sites have less links, an option to sign in to Internet Banking and a link to the bank’s “full site.”
• Mobile Banking App: In its most generic form, an app that gives you immediate access to your bank accounts.  Some banks are starting to offer account aggregation options with their mobile banking apps.  Account aggregation allows you to access bank accounts you have at other financial institutions.  In other words, customers can get a total picture of their finances.
• Mobile Deposit: An app that allows you to deposit your check just by taking a photo of it.  This is a convenient app that can reduce trips to the bank.  How cool is that?
• Mobile Cash Management: A fairly new app being offered by banks.  It’s an app for businesses that allows business owners to streamline their cash flow.  This can vary based on the type of cash management tools a bank offers.
• Mobile Merchant Services: Perhaps the most popular example of this is Square.  This allows people to accept credit card payments with their smartphone or tablet.
• Mobile Wallet: Exactly what it says, an app that works like a wallet.  You can store coupons, purchases and other information in this new “wallet.”

For people working with banks, be sure to find out what your current bank (or future bank) truly offers when it comes to mobile banking.  What kind of apps are available?  What security measures have they taken?  These are just two important questions people should ask their banker.

For people who work for banks, or credit unions, create some sales training and look for opportunities to educate you team about this trend.  There is no doubt that mobile apps are growing and can be a great way to improve or expand your relationship with your customers.

Welcome to the future!

Convenience: Old Verses New

When I first became a community banker, people would ask how many locations the bank had in town. When I told people over twenty locations, with five in Chattanooga, they would say something like this:

Only five? That’s not convenient. Amsouth has about twenty locations around Chattanooga, and they are convenient.

True, Amsouth did have more locations, but let’s fast forward to the present: people ask different questions to quantify convenience and Amsouth ain’t around anymore.

Now, I work for a community bank in Knoxville that has a total of four locations, but that doesn’t seem to bother most people. Especially when they hear:

• Free Worldwide ATM Access
• Free Online Bill Pay
• Mobile Banking
• Mobile Check Deposits

Most people understand the first three examples, but a few have not hear of Mobile Check Deposits. This mobile app allows people to deposit checks into their bank account by simply taking a photo of the check. Talk about convenience!

This new mobile app (only available at four different banks in Knoxville), is a global trend that is defining the new convenience of banking. This new convenience is due mainly to the increase of mobile technology, and even companies outside of the traditional banking structure are benefiting. Paypal, Google and Apple all have virtual wallets that are slowly starting to break down the old convenient view of banking…to the point of replacing the need for a bank all together; unless there is a need for a loan.

Who knows, if Paypal merges with a lending company like Quicken Loans or Discover, then there could be an updated version of the new convenience.