Recent development and study shows that mobile banking via smarthphone is here, but consumers are not quite ready to accept it as the norm. These studies also show, however, that this is likely to change, and very soon too.
Most people will probably agree that, even if they do not work in or are very familiar with the financial sector, the future of banking is in the palm of our hands, literally. While credit cards continue to thrive and debit cards continue to grow in popularity, smartphones are the payment method of the future. Although this is a trend that is becoming more and more obvious it is still definitely under much scrutiny. To get a better idea of this trend in Australia, though, you only need to look at the Australian Bureau of Statistics, which shows that banking and paying bills is the third-most popular use of the internet across Australia. Statistics also show that cheque writing in Australia is dropping: from 467 million in 2006 to only 256 million cheques written in 2011.
In anticipation of what is to come, the Federal Government’s Financial Sector Advisory Council, Peter Evers, says
The smartphone will become the ultimate banking tool. It will act like the eftpos machine. Instea of having a debit card or credit card, smartphones will soon have that technology and it’s starting to emerge now.
He believes, then, that banking in the near future will make a dramatic shift from physical call centers and static locations to visual/video conferencing via smartphones. Similarly, Evers believes that consumers will have very little need to visit an ATM or other cash money machine or even their bank branch because everything will be available online and through their smartphone. He says that safety is probably the primary issue preventing consumers from completely buying in to the services. Obviously that will change over time, but for now, here are the pros and cons of mobile banking as it is today:
Although it is still very young in the worlds of finance and industry, mobile banking is piquing the interest of young entrepreneurs and technophiles alike. It may not quite be perfect yet, but no system truly is. At least, it is easy to examine its inherent benefits and make an educated decision regarding whether or not it is good for you.
- Immediacy: you can bank at your leisure, no matter where you are in the world
- Multiple transaction options that give you the flexibility as you choose or as your needs allow: live calling, mobile browser, downloadable application, text support
- Security: because of the insecure nature of mobile communications, mobile banking services can be provided without the transmission of your account number. This is actually much more preferable than the traditional computer banking model which does transmit your account number
- Most banks send their wireless transactions through encryption services
- Most of the time, mobile banking is a free service of the providing bank
Again, nothing is perfect, but at least mobile banking has the benefit of infancy, which means that many of the kinks are going to be worked out over time. Still, even as people use it now, there are a few detriments that some consumers are not willing to overlook, waiting until they are fixed before they jump on board the mobile banking trend.
- Although encryption is involved with mobile banking, not all services can be encrypted to the same degree. Text messaging, for example, is not encrypted, but it is stored in the phone so any transactions performed via this method run a risk for interception, breach, and other vulnerabilities
- Although they are continually under development and always improving, smartphones are not yet compatible with the best anti-virus software programs available for computers. Because of this, obviously, identity theft and other cyber-crimes may become more of a concern as people continue to move more and more towards mobile banking
- Although most banks are moving in this direction, not all banks are prepared or equipped to move at the same speed. This means that not all banks can offer the same kinds of services or protection in terms of mobile banking than, say, for their corresponding, fully-online services.