Despite a boom in demand for mobile services, 27% of the UK’s financial institutions have no mobile strategy whatsoever.
Investment in mobile computing capabilities by UK banks and financial institutions has become accepted as a key competitive advantage in the market. Despite this, just 27% of financial institutions have a mobile strategy, according to research released today by Rackspace Hosting.
To maintain the competitive advantage, and draw in the new generation of consumers, mobile apps are considered ‘crucial’ to 63% of the financial services organisations surveyed.
Well over half of UK phone owners own smartphones, and ComScore research shows that 4.8 million of them used their device to access their bank accounts in 2011 (see CBRs feature story on mobile payments here)
The UK banking industry’s approach to mobile banking has long lagged behind most other developed countries. Serge Van Dam from Fiserv believes that 2012 will be the year when the UK banks ‘wake up‘ to the potential of mobile banking.
"It will be more than something they talk about to ‘seem innovative in the market’. It will cease to be a ‘nice to have’ and become an essential. This in turn will push a desire for investment and drive innovation," he told CBR.
Despite this, Rackspace’s research shows that just 20% of financial institutions have released a consumer based mobile application in the last 12 months, while another 17% are still in the process of developing their mobile apps.
"This is an area that is going to continue to grow in importance, as developing mobile apps is considered by 68 per cent of respondents as something that will have an impact on their business in the future. As banks strive to provide individual and institutional customers with the technology to conduct their banking needs on the move and via any device there will be an increasing reliance on mobile apps and the cloud as the delivery mechanism," Fabio Torlini, Rackspace VP of Cloud.
Research by YouGov suggests that students are more likely to use their smartphones to manage their finances than any other group in Britain.
YouGov’s research found that 53% of students who own a smartphone would manage their bank accounts via their mobile device if they could, compared to 44% of people in the full time workplace.
A quarter of students with a smartphone said they would use their mobile for peer to peer transfers, such as mobile app Pingit, versus 22% of people in full or part time employment. (See CBRs interview with Barclays’ Richard Martin & Mike Walters here)
Mobile phone payments are already tipped to reach $37bn worldwide by the end of 2012.