Mobile Banking Sector Experiencing Exponential Growth

The Federal Reserve Board recently released the results of its fourth annual study of consumers’ online banking behaviors, which revealed a strong continued trend of upward growth. Key findings include sustained increases in the number of smartphone users who have full access to online banking services, and in the number of people who do some or all of their banking through mobile platforms.

Interestingly, the report also revealed high rates of mobile banking usage among consumers who are considered “underbanked.” To qualify as underbanked, a consumer must have a bank account, but regularly use supplementary financial services including payday loans, check cashing, pawn shop loans and/or vehicle title loans. A surprising 48 percent of underbanked individuals were found to use mobile banking services.

Remote deposit capture services, which allow users to deposit checks by submitting a digital image to the financial institution, are also on the rise. In 2014, about 50 percent of all mobile banking users took advantage of the technology, signaling a 38 percent increase from 2013 figures. Industry analysts say that early adoption of this technology is very important for financial institutions, as it is expected to continue its strong growth trend in the years ahead.

The study also highlighted findings that will be of interest to any forward-thinking financial app development company. It concluded that while mobile banking will likely come to dominate the financial services industry, people will still make physical branch visits until all core services become available through smartphones and mobile devices.

San Francisco app developers and mobile software professionals throughout the United States may want to pay close attention to the banking industry as they look to create and market new products. Currently, the mobile banking industry generates about $400 million in annual revenues, but by 2017, that figure is expected to rise to at least $700 million, which would translate to 75 percent growth over a three-year period.