Not All Financial Institutions Are on Board the Mobile-Banking Train

Payments experts may think mobile technology is crucial for banks and other financial-service providers, but it turns out a significant chunk of financial institutions don’t agree.

Fourteen percent of respondents in a survey this summer of banks and credit unions said they not only don’t offer mobile payments and other mobile-banking services but have no plans to offer them. These were, with just one exception, institutions with assets less than $500 million, but the group included an almost equal number of banks and credit unions.

The results of the research were released in late September and drew a brief commentary this week from David Lott, a payments-risk expert for the retail-payments risk forum at the Federal Reserve Bank of Atlanta.

The survey came from the Atlanta Fed, along with the Boston, Cleveland, Kansas City, Minneapolis, and Richmond Fed districts. They conducted a so-called quick-hit survey with only five questions, all of them aimed at gauging institutions’ interest and involvement in mobile financial services. This brief canvass served as a follow-up to two mobile-services surveys in 2016, one conducted across all six districts and one for just the Atlanta district.

The relatively strong lack of interest in offering mobile banking came as something of a surprise to the researchers, Lott indicates in his post. He also cites a relative absence of tracking data on mobile services, as revealed in the survey.

“Not tracking or being unwilling to reveal customer usage levels of mobile banking services remains an issue,” Lott says. He suspects most institutions not disclosing results are actually tracking them “given that a standard reporting option of mobile-banking systems is to be able to track enrollment and unique sign-on activity.”

Among the banks and credit unions offering mobile services, more are interested in mobile banking than are interested in mobile payments. “Offerings of mobile payment services continue to lag significantly behind mobile banking,” says Lott.

Some 565 financial institutions answered the survey, for an 11.7% response rate. Respondents skewed smaller in asset size than was the case with the larger 2016 survey, Lott says.

He adds that a more detailed mobile banking and payments survey will be fielded early next year.