The use of mobile financial services continues to grow, with 33 percent of all mobile phone users and 51 percent of smartphone users engaging in mobile banking over the prior 12-month period, according to a new report from the Federal Reserve Board.
“Consumers and Mobile Financial Services 2014” is the agency’s most recent review of mobile banking and mobile payments, two prior annual reports having been released.
Among the surveyed consumers, the most common banking activities continue to be reviewing account balances or recent transactions (93 percent of mobile banking users) and transferring money (57 percent). The Fed found that the use of mobile phones to deposit checks increased significantly over the prior year (up to 38 percent from 21 percent).
Mobile phones are also changing the way consumers make payments, the Fed said. One area of substantial growth: the use of mobile phones to make payments at a point of sale, with 17 percent of smartphone users (representing 9 percent of the U.S. adult population) reporting they used their phone to make a purchase at a retail store over the last year, an almost threefold increase. The most common form of mobile payment is bill payment, used by 66 percent of mobile payment users, up from 42 percent in the prior year.
The survey also noted that the use of mobile financial services is particularly prevalent among the 17 percent of the population considered to be underbanked. Of the 88 percent of underbanked consumers with mobile phones, 39 percent engaged in mobile banking in 2013, the report found.
According to the report, the use of mobile phones to make decisions while shopping has also increased. Forty-four percent of smartphone users compared prices while shopping and 42 percent checked product reviews. The information gleaned from such activities resulted in more than 66 percent of respondents changing where they made a purchase after reviewing the price comparisons.
The report is based on data collected during the month of December 2013 from more than 2,600 respondents about their mobile banking activity during the 2013 calendar year.
To read the “Consumers and Mobile Financial Services 2014” report, click here.
Why It Matters: The Federal Reserve Board’s report serves to confirm what the industry already knew: Consumers are increasingly relying upon mobile devices for financial services. Interestingly, however, the report also documented that even as the use of mobile banking continues to rise, those consumers who do not engage in mobile banking are less likely to ever use it. Of the consumers who do not currently use mobile financial services, more than half expressed no interest in the technology; others expressed concern about the security of features like point-of-sale payments; and just 12 percent said they will “probably” use mobile banking within the next 12 months.