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Riding the Wave of Mobile Banking

Smartphones have created a consumer demand for all lifestyle tools to be packaged in one neat space that we keep in our pocket and can access on the go, from any location.  Improvements in security and performance have resulted in an increasingly confident consumer that is more open to banking through their phones.  Mobile dominates our social and business lives – and this is just the start of it.  To that effect, over the last few months there has been a noticeable spike in the number of financial institutions who integrate mobile into their banking offering, perhaps as part of wider projects to revamp legacy systems.

Deutsche Bank’s CIO, Wolfgang Gaertner, recently spoke at the Sapphire Conference in Orlando and spoke out about the financial sector’s need to move away from in-house legacy systems and embrace newer IT solutions. He spoke of Deutsche’s work with SAP to transform the company’s IT infrastructure with a whole-system update. As financial organisations often loathe to speak out about the work they do with technology, it was refreshing to hear about someone preaching ‘revolution’ not just ‘evolution’ – radical and substantial changes in IT, rather than gradual and incremental upgrading, refining, and renewing. But it doesn’t mean that revolution is the only option, particularly when it comes to mobile.

With the plethora of services and products now available to CIOs, CTOs and IT Directors, it’s reasonable to expect that these highly-impressive solutions should complement existing infrastructure, not disrupt it. Where companies will want to see disruption is in the industry they work in – ripples which emanate from the impact from a shifting approach to technology.

BNP Paribas recently announced that it will be launching a full-service mobile bank in four European countries. Hello Bank is the first bank designed specifically for mobiles, and is at the very least reflective of the emphasis being placed on mobile within the financial sector. BNP aims to have 1.4m customers for Hello Bank by 2017, from Germany, Italy, France, and Belgium. All this is happening at a time when the bank is at the beginning of a three-year long cost-cutting programme, to the tune of €2bn of savings.

The real test of this new venture will of course be the capability of the system to cope with high volumes of data traffic, whilst maintaining the best possible customer experience. With a projected 1.4m users enjoying the service within the next four years - all within the same time zone - traffic levels will fluctuate hugely, so it’s vital that BNP has the right platform in place to scale up and down with these peaks and troughs.

On the other side of the Atlantic, JPMorgan Chase has confirmed its dominance at the pinnacle of US mobile banking, by topping the Keynote Mobile Banking Scorecard for the third year in a row. According to an article in American Banker, JP Morgan Chase provides the most across-the-board functionality, and came only one month after being named best in mobile banking out of 15 major multinational banks by analyst house Forrester.

This calibre of recognition highlights a company which embraces technology as essential to its business.

In fact, the word ‘embrace’ is perhaps the most important when it comes to mobile banking. Mobile covers multiple devices, operating on numerous systems, with varying levels of connectivity. The only way to maintain the levels of availability and customer satisfaction needed is for organisations to continually adapt to the ever-changing world of mobile technology. It’s impossible for the fundamental technology behind a mobile banking offering to be anything other than truly device agnostic, as this is what the ventures like Hello Bank and the banks of the future will rely on, if they’re not already.

Agile adaptation and sustainable improvement are the keys to the Brave New World of mobile banking. As such, organisations should look for a single scalable data distribution solution which complements their existing infrastructure and works with any device. The resulting agility and flexibility mean any institution which takes these considerations on board will see the business benefits.

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Comments: (1)

A Finextra member
A Finextra member 06 June, 2013, 15:33Be the first to give this comment the thumbs up 0 likes

A great Blog Sean and absolutely agree with the technology points made.

We have just been reviewing the Mobile Banking sector in our soon to be released "Mobile Banking In action" report.

Looking at some of the trends, (without giving too much detail away), we have seen phrases like:

"Provider Collaboration,Buying in packages, and hiring more term contractors"

coming to the fore in a way we have not seen before in other reviews.

What marks this sector out from the rest is the increased, and likely increasing, reliance on outsiders to deliver change. I think this will be a bigger shock than banks currently realise.