# Mobile

Advantages of Mobile Banking for Businesses and Customers

Red Rocket TeamOct 1, 20246 min read

Do you remember the days when the appearance of ATMs on the street and the proliferation of credit cards was somehow an amazing event? Surprisingly, about 30 years have passed since then and today banking has changed significantly. This is mainly due to the introduction of banking apps or as many people say - mobile banking.

Surprisingly, in the past, all the leading banks did not accept new innovative ideas and were dubious about any dramatic changes. In 2024, banks are competing with each other and are in a race of mobile banking innovations to get as many customers as possible.

We have some stats for you regarding banks' mobile apps to make you realize how far this field has progressed. For example, the total number of mobile banking users in 2024 reaches approximately the 2 billion people mark. This means that almost every fourth person on our planet has mobile banking on their smartphone. The conducted research among banks also showed incredible results. What is known? 82% of the banks surveyed admitted that innovation with apps is the key to success in increasing the number of customers and overall revenue.

Are you still not sure why digital banking is beneficial for both financial institution owners and ordinary customers? In this article, we have prepared a lot of interesting information, statistics and facts to point out the real benefits of mobile banking.

How is Mobile Banking Benefiting Business Owners?

First, we suggest looking at online banking from the perspective of the originators (owners of financial institutions) and understanding how it benefits them. We have collected five key pros, which we will discuss below.

1. Increase in the Number of the Bank's Clients

Indeed, statistics suggest that the process of banking through the application leads to increased customers for the bank. Individuals today are more reliant on their phones and tablets for everything, and having the ability to manage finances on the go is incredibly appealing.

In fact, there is evidence that 40% of the mobile banking user would be willing to change their bank if the latter provided an enhanced mobile banking experience. This goes a long way in establishing the importance of mobile banking features in choosing a financial service provider.

Also, mere downloading of the app educates new users on the wide array of products and services that the bank offers. It results in cross-selling of other products and services to the existing clients since the clients are provided with an easy digital access. This is the reason opening up mobile access allows banks to grow their client base organically.

2. Additional Tool for Marketing Campaigns

How often do you watch TV or listen to the radio? In 2024, such channels are no longer highly effective for attracting customers and introducing them to new company products. The situation is similar with outdoor advertising—many people have simply stopped paying attention to large signs or brightly colored billboards. Mobile devices have also emerged as an unrivaled channel for direct marketing of services and products to bank clients. Banners and push notifications inside a native mobile application enable targeted and trackable promotion.

This is because, as business owners, they can focus on promoting items such as competitive interest rates on savings accounts, loan specials, new methods of managing accounts online, and many others. In fact, the moment a customer enters the application for mobile banking, they are confronted with these marketing messages and offers.

Further, the nature of data provided by mobile applications enables the segmentation of users and provides relevant and targeted offers that are aligned with the users’ account and banking interactions. This highly personalized marketing is effective in communicating with the audience and increasing account usage.

3. Improved Security

Mobile banking has been found to be particularly beneficial to owners of small businesses because it makes it easier and safer to manage finances. It is important for bank owners to have a good reputation with minimal cyberattacks.

Firstly, the enhanced protection is likely to be felt by one party that adopts the system. Current banking apps feature advanced encryption, fingerprint and facial recognition, and two-factor authentication to ensure the safety of operations and personal information. This means that owners would not experience hacking or data theft that they would so much worry about nowadays due to increased cases of cyberattacks.

Mobile banking also enables visibility and control in one place. Whether it is tallying accounts, monitoring receivables/payables, or verifying inventory expenses, all these are easily accessible without having to switch between platforms. Apps also update the customer on any activity that occurs on the bank account in real time. This assists the owners in monitoring the accounts to ensure they do not incur losses through fraudulent activities.

4. Small Costs

Mobile banking can be regarded as one of the most significant innovations that has appeared on the market in recent years. The adoption of mobile banking solutions can greatly minimize costs which might be incurred in establishing and maintaining bank branches, as well as undertaking manual transactions.

The first and most obvious cost benefit is that no physical bank branches would have to be established to serve customers. Almost all simple banking operations can be delivered to the customers through their mobile device if the application is developed correctly. This saves a lot of money in terms of real estate and human resource costs. That is how the development costs for mobile apps are recovered through such savings.

Other cost savings involve services that were formerly done manually to improve efficiency and speed. For instance, mobile deposits enable users to complete check deposits without physically visiting the banking hall. This means that there are fewer tellers and administrative employees required to run the bank. In general, mobile banking reduces the costs of operating a business and increases the business owners’ profit margins.

5. More Unique Information About Customers

In the past, banks used to call customers on the phone or conduct large surveys right in the branch. With the introduction of digital banking, a lot has changed, and now banks can use apps to get valuable information about their customers. We suggest you take a closer look at this benefit below.

The first potential benefit is an improvement in the understanding of the clients and the customer needs through the analysis of mobile analytics. The banking app gathers valuable information about purchasing behavior and the type, frequency and mode of payment. These facts can be useful for business owners to comprehend customers’ requirements, identify new opportunities, and improve their products. For instance, when a retailer observes increased mobile payment transactions and fewer cash transactions, they should increase mobile coupons and loyalty programs. Mobile leads to the opening of an information channel to help in serving the clients.

Mobile banking can help the businessmen to improve the money management mechanisms and gain deeper insights into the customer needs and trends, which can overall improve the functioning of the enterprise in the modern world. It enables them to make better decisions that can impact the organisation positively in terms of revenue.

Why is Mobile Banking Convenient for Customers?

Now it is clear why financial institutions are always trying to stay in the trend and introduce mobile banking. We suggest you go further and consider all customer benefits of mobile banking. We are sure you use such applications yourself and know why it is cool.

1. Convenience of Financial Transactions

Obviously, the first reason why more and more people are choosing online banking over offline banking is convenience. In simple words, you don't have to spend your personal time going to the bank. Instead, you can perform many tasks right from your smartphone. Even 10-20 years ago, many routine tasks used to take up a lot of time, energy, and nerves of people. What are we talking about?

Payment of utility bills.
Replenishment of mobile phone.
Transfer funds to another account.
And much more.

To perform such tasks, a person has to spend a lot of his personal time and also stand in a queue. When the first mobile banking apps appeared, customers were able to breathe a sigh of relief as there was a quick money transfer function.

Over time, digital banking has evolved and today, customers get a plethora of options. To pay utility bills, top up your account, and even pay for a parking ticket, you need to tap a few buttons on the app. There are also many other services and features. For example, it is now possible to take a loan online on the app without getting up from your couch. Some banks even offer to arrange a debit card and have it delivered by courier right to your doorstep. Sounds cool, doesn't it?

2. Getting Help Online

Finance is an industry where additional questions or problems may suddenly arise. Paying utility bills, topping up an account or buying goods from an online store - in any of these tasks users may experience difficulties, so it is important to get quick help from specialists. Previously, users had to go to a bank branch or call the hotline, which was often busy with other calls. Operators did not have time to answer every one, which led to lower customer satisfaction.

Some of the mobile banking apps have incorporated the in-app messaging option that allows customers to directly communicate with the support staff. This enables the customers to seek help in real-time without the usual fuss.

Other features also contribute to making it very convenient. A customer can be able to access his/her account balance and transaction history at any time as opposed to bank hours. Mobile deposit enables checks to be deposited just by capturing a picture through the app. Notification aspects such as the push notification and the ability to set budgets and have a better view of accounts and spending before the fact is preferred to having to review accounts after the spending has already occurred.

3. Elements of Games

Although banking is a serious business, many entrepreneurs prefer to get creative with the design and functionality of their apps. However, mobile banking's main target audience is young people who like creativity. Gamification is implemented in many bank applications. Developers add some elements of games to make the user stay in the app longer. This also helps to improve the customer loyalty score.

What example can we provide? Ukrainian digital bank monobank was one of the first to add some game elements in the app. They added a section with rewards that you can get for completing tasks (making 10 purchases at the supermarket, paying a fine, and more). These rewards can be exchanged for unique skins for the app's main character, the cat.

4. Personalized Offers

We've already talked in this article above about personalization, where financial institution owners get more information about their customers and their preferences. This allows them to not only understand what their target audience looks like, but also to form separate offers for each bank customer.

For example, many banks analyze your income and expenses to give you the opportunity to take out a loan. Based on your data, they calculate the optimal amount they can lend you. Another good example is that if you frequently pay traffic fines, the app may offer you favorable insurance for your vehicle.

5. Innovative Functions

The best feature is that banks continue to develop new additions to the app that would be extremely useful. They do this to remain relevant and target consumers who are more likely to use the digital platform. Some examples of the latest convenient and innovative mobile banking functions include:

AI Banking Assistants. Instead of calling your bank and waiting on hold to speak with a representative, AI consultants are now available. They can answer often-asked customer service inquiries, suggest financial tips based on your spending habits, and other features that allow you to chat and even talk to your banking assistant. This saves the customer at least time which would have otherwise been spent on waiting for a customer service representative or browsing FAQs.
Cardless ATM Access. Most of the banks today let their clients use their mobile phone banking application to withdraw cash from an ATM. This does away with the need to carry cards around thus avoiding the inconveniences associated with it.

Another innovative feature that is becoming more popular today is head-to-head payment. Yeah, you read that right. Leading apps have introduced the ability to pay bills, send money to others, and make purchases simply by speaking to your phone.

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Final thoughts

Now you know why financial services in a mobile app is not just an unnecessary innovation but a necessity for any bank. Financial institutions attract more customers and learn more personalized information about them. Customers, in turn, get an innovative digital product that saves them a lot of time. All you have to do is unlock your smartphone and log into the app.

Sure, in this article, we've talked exclusively about the positive aspects of digital banking. Disadvantages also exist, although they are not significant compared to what these banking apps can give to mankind. We believe that this field will continue to develop further, gradually updating itself.

Frequently asked questions

What popular banks have introduced online financial services?

Actually, it's easier to list the banks that don't have mobile banking yet. Today, almost every reputed bank has its own mobile app for customers where they can easily manage their finances. Bank of America, Citi Mobile, Chase Mobile are a few examples of top global banks that have successfully created mobile apps for financial services.

What is the future of mobile banking?

Today, more and more financial institutions are releasing their own mobile applications. This simplifies interaction with clients and generally increases the efficiency of the company's work. Speaking about the future of this sphere, you need to see what the experts say about it. Specialists believe that soon the usual branches will disappear altogether. They predict that all relationships between the bank and the client will move to a remote mode in just a few years.

Why is mobile banking being introduced in the form of an app?

People always carry cash with them and they usually keep it in their wallet. This means that the money is always with them, because they may need it at any time. With digital money, the situation is similar - you should always have access to it so you can transfer money to a friend at any time, pay for a basket of groceries at the supermarket or buy movie tickets for a date with your girlfriend. Imagine how long it would take if mobile banking was presented as a website or web application.