The explosive growth in digitalisation has drastically transformed the modern banking landscape. New digital capabilities have brought clear benefits to consumers, including convenience, choice and accessibility, but they may have also opened the door to some problematic side effects.
In a recent survey conducted by FIS, 51% of UK consumers said they are obsessed with checking their banking apps and balances. This phenomenon of “financial doomscrolling” has been fuelled by the UK’s troublesome economic climate, which has put many consumers on high alert as they seek to manage their finances in tough conditions. With so many of us now chronically online, it’s time to consider whether having 24/7 access to all our financial data via a mobile device is a help or a hindrance when it comes to our money worries.
Money on our minds
According to FIS’ research, 45% of consumers in the UK think about their money and financial situation every single day – typically around five times a day. Over a third of people actually check their current account balance daily.
These habits are often driven by financial concerns, with 41% of respondents saying they check their banking apps so frequently because they are worried about their financial situation. Just under half (47%) spend time thinking about how to improve their financial situation.
The rising popularity of banking apps means that users can instantly access the frequent updates and interactions they crave, whether they are trying to make their money work harder or simply trying to make ends meet.
While such accessibility, along with the turbulent economic climate, may have led to the trend of financial doomscrolling, mobile banking apps may also have a positive role to play in improving the financial wellbeing of customers. With the technology ubiquitous, financial institutions are well placed to help educate their customers and guide them towards the right financial solutions for their needs.
The rise of mobile banking
Today’s mobile banking has its roots back in the late 1990s, when SMS banking first took hold. Services were limited – customers could text to check their balance and receive alerts when they were about to hit their overdraft, but most other functionality could only be accessed over the phone or in person at a branch.
The evolution of mobile phones into devices capable of rivalling computers for processing power and software, along with rapidly accelerating download speeds of mobile internet standards, opened a whole new world for mobile banking.
We’ve seen smartphone apps become a mainstay of mobile banking over the past decade, offering customers an increasing number of features, better security, a more efficient user experience, and greater peace of mind when it comes to mobile banking.
In fact, according to Deloitte, mobile banking has easily overtaken more traditional forms of banking, with customers expecting banks to act and interact like any other technology brand.
Keeping customers (h)appy
There is no doubt that the rise of banking apps has permanently changed the landscape for financial institutions. Customers no longer simply choose a bank because it’s physically closest to them, or offers the best interest rates, or even the best customer service.
Apps matter, with 56% of respondents to our research suggesting that mobile banking is the leading reason for loyalty to their primary bank. This number rises to 63% for Gen Z respondents (those aged 18-27). As such, it’s critical that financial institutions provide a seamless experience to keep customers happy, to meet their needs, and to boost retention.
Younger generations in particular expect their financial experiences to be as intuitive as scrolling through social media. Although challenging, this offers an opportunity for financial service providers to unlock added value for consumers by embracing technology throughout the money lifecycle, while using their trusted relationships to help customers to move away from doomscrolling and towards financial freedom.
Embracing technology
Financial institutions have an opportunity to build on the loyalty of customers and their growing appetite for mobile experiences, by delivering solutions that alleviate their financial concerns.
When we asked consumers what features and services they were most interested in using, 47% said access to a single platform to manage all their financial services activity from all their providers was their top priority. The demand for a unified financial platform highlights consumers’ desire for simplicity, convenience, and efficiency in managing their finances. Financial service providers must recognise and address this demand by investing in technology that further streamlines, simplifies and enhances the customer experience.
The industry needs to embrace continuous innovation and adapt to technological advancements, developing the next generation of financial services that can help to cater for evolving customer requirements. Now is the time to shape future trends, developing the foundations for simpler, more seamless mobile banking that puts the customer first.
Such innovations and technologies include fraud and risk mitigation solutions, digital wallets, and cutting-edge advancements such as artificial intelligence (AI), machine learning, and generative AI.
This can make a big difference for customers and banks alike, from ever-more efficient chatbots capable of learning from previous interactions and providing more effective responses, to AI-based risk assessments capable of aggregating and analysing client data across financial crime detection systems, helping banks to increase efficiency and better manage regulatory compliance and risk.
Information is power
It’s clear from our research that many customers are concerned about their finances, and it’s easy to understand why. But monitoring apps and balances doesn’t need to equate to doomscrolling. Conversely, access to the right information at the right time can be a foothold towards greater financial stability.
Through more advanced yet streamlined solutions that embrace cutting edge technology, financial institutions can help to educate customers, present them with timely information to make better choices for their financial needs, and guide them across the challenging financial terrain.
Forget doomscrolling; when used effectively, mobile banking apps can empower customers to really get on top of their finances and will in turn boost customer satisfaction and loyalty to the bank.
Rob Hudson is Head of International Banking and Payments at FIS
“How can mobile banking help to combat consumers’ financial blues?” was originally created and published by Electronic Payments International, a GlobalData owned brand.
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