The number of mobile banking users will grow to more than 2 billion in 2021 from 1.2 billion globally this year, says Juniper Research.
Growth driver for the increase in mobile banking is the consumer adoption of banking apps and the changing way consumers manage their finances.
The number of mobile banking logins have already surpassed internet banking logins in many markets.
# Stats and Figures
There were 11 million banking app logins against 4.3 million internet banking logins in the UK in 2015, reveal reports by British Trade Association for Banking, dated July 2016.
The use of apps on mobile devices also escalated to 11 million in 2015 from 7 million in 2014.
The app downloads saw a 25 percent gain to touch a total of 13.8m downloads, in the last year.
Also, the number of payments via app rose by 54 percent last year, while payments via websites went up by just 2 percent.
In addition, around 65 percent mobile banking customers in the US and the UK use apps to conduct banking services, as per a recent Juniper Research survey.
# Digital Banks: The future of banking?
Customers are required to log in to respective bank’s website whenever a payment to a new person has to be set up.
To avoid an inconvenience related to this, new app-based banks like Atom, Starling and Tandem have come up, easing transactions on the move.
Such launches may lead to a digital disruption in the banking sector, driven by tech-companies and vendors.
In 2016, UK has seen 5 new digital banks receiving licences or launching digital services, namely Starling, Tandem, Atom, N26, and Monzo.
Also, around 20 banks are in a discussion stage with regulators to obtain a licence. Hence, by 2017, banks in the EU will also face demands for APIs.
Soon, a new market featuring innovative products analyzing user data to offer customer-suited financial services, with user-permission, may be seen.
Hence, traditional banks are under pressure to respond swiftly to maintain their market shares, against the upcoming digital market.
New revenue channels and enhancement of current client base through constant improvement can aid the traditional banks to meet the demand.
At the same time, new-age digital banking services will need to enlarge market shares while maintaining long-term profitability.
Vina Krishnan
editor@telecomlead.com