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Could the future of banking look like a smartphone

Will Mobile Banking Change Our World?

Could the future of banking look like a smartphone? Since most bank transactions are digital, your smartphone may well be what the future of banking will look like. Smartphones with banking applications are most certainly destined to transform banking from location-centric to mobility-centric.

The banking habits of people worldwide have already changed with the widespread use of the Internet and online banking tools. Most routine transactions can easily be done using a bank’s secure online portal. This capability enables bank customers to have direct access to their accounts and utilize many of the bank’s resources.

Nearly all large brick-and-mortal banks (e.g. Bank of America, Wachovia, Wells Fargo, etc.) offer both online banking and multiple physical locations, but they are now consolidating and closing locations in record numbers. Millions of banking customers are choosing online banking services or even online banks over the ‘old-fashioned’ way of conducting bank business. Why? Consider these very simple and practical advantages of online banking:

  • Fees are lower
  • ATMs can handle most paper transactions
  • Online services include e-Deposit which allows a customer to take a picture of a check and upload it for deposit
  • Online banking offers higher interest rates
  • Call centers available for personal conversations
  • Money will grow faster with online banks than with the big banks

According to Richard Barrington, Senior Financial Analyst at, “Online banking is cheaper for banks to offer because they’re not supporting a physical branch and the staff. Even banks that offer both are likely to provide higher rates and lower fees if you choose their online options.”

What about mobile banking?

It should come as no surprise that mobile banking is most popular among younger bank customers. Mary Monahan (Executive Vice President and Research Director for Javelin Strategy and Research) says, “Mobile phone adoption has been particularly strong among younger consumers. Nearly half of all mobile-phone users under age 35 conduct bank business on their phone.”

Mobile banking, just like online banking, is fast and convenient. These services let bank customer control their time better and keep their financial house in order. To give you an idea of the scale of mobile banking, only 12 million people used mobile banking services in 2009, but that number will climb to 45 million by 2014 .

How does Mobile Banking Work?

There are three ways mobile customers can access their accounts and perform a variety of tasks: SMS texts, mobile browsers, and downloadable applications. These three channels make mobile banking very useful and easy to do with a smartphone. The following are a few examples of transactions that can be done online:

  • Person-to-person (P2P) payments
  • Mobile bill pay
  • ATM locator
  • Text alerts when balance fall below a set level
  • Access coupons for frequented merchants, and other promotions

Mobile banking doesn’t create new transactions or bank services, but it does enable users to perform many banking chores faster and far more conveniently.

Where is Mobile Banking Going?

Downloadable mobile apps are growing faster than any other mobile channel for banking. For example, Bank of America, which now has over 4 million users, offers bank applications for 800+ devices. These include smartphones as well as Blackberry devices. Most banks are going after the iPhone market first and then the BlackBerry.

One advantage mobile banking has that typical online portals don’t is that smartphones can perform transactions without having access to the Internet. However, mobile banking still has a long way to go before it will overtake online banking. Mobile services are still quite basic and smartphones are most often used to augment either online banking or onsite banking.

The American Banker magazine reviewed a number of mobile banking apps and selected their ten most progressive apps. Their judging criteria were: account application features, design and ease of user:

  • American Express – provides discounts and offers from merchants
  • BBVA Compass – offers an app for Amazon Kindle Fire
  • Bank of America – first to have a Windows 8 app and refined interface for iPad
  • Capital One – enable users to bump money between phones and make P2P payments
  • City Bank Texas – let customers turn off debit card and view check images
  • Mercantile Bank of Michigan – first bank to partner with PayPal
  • Pageonce – able to pool financial accounts into a single view, even pay other people’s bills
  • Simple – subtle design touches make this mobile app standout
  • USAA – provide voice command options
  • U.S. Bank – first to offer many services and they charge 50 cents for each mobile check deposit

KnackTek Mobility

When it comes to developing mobile apps for banking transactions, the big banks clearly have the resources to build their own. But, when you consider that the big banks (greater than $1 billion in assets) make up less than 10% of all U.S. banks, this leaves a lot the smaller community banks looking for ways to compete in the fast moving mobile market. According to the Independent Community Bankers of America, there are almost 7000 community banks with more than 50,000 locations in the U.S. and virtually every bank is feeling the pressure to provide mobile banking services to their customers.

KnackTek has positioned itself to provide mobile development services to small and mid-size banks, and at a cost that is highly competitive. We realize that the small and mid-size banks have a better use for the financial resources than investing in their own, in-house mobile application development staff.

In addition to providing the development resources, KnackTek offers 360 degree service that includes, maintenance, upgrades, and support. This gives our customers peace of mind in knowing that their banking customers will have the mobility tools they need now and well into the foreseeable future.

For more information on how KnackTek can help your financial institution expand your customer base with mobile banking apps, please contact us at: or call 678-956-1780.

Get started today: Call (470) 395-0210 or email


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