The number of US customers using mobile banking services will accelerate over the next five years, rising from 1.1 million in 2007 to more than 40 million by 2012, according to forecasts from TowerGroup.
Take-up of m-banking services is expected to soar over the next five years, with numbers increasing four fold from 1.1 million in 2007 to 4.6 million in 2008. By 2009, 10.4 million US customers will be using the services and this is set to jump to 18.7 million in 2010, with take up soaring to 29 million in 2011 and hitting 40.9 million in 2012.
The growth will be driven by major improvements in technology across wireless networks, handsets and applications, says TowerGroup.
There will also be huge marketing investments by top banks to increase consumer awareness and trial, which is expected to coincide with a growing desire for real-time, self-service transactions amongst customers.
But TowerGroup warns that challenges relating to information security and consumer privacy may still affect market growth.
According to the research, customers that already use Internet banking services will be most likely to adopt the new technology, with up to 30% taking up mobile banking over the next five years. However m-banking is also expected to appeal to people who are unwilling to use the Internet to manage their accounts.
"Beyond technology, broad participation in mobile banking will be most encouraged by maximising and improving the customer experience," says TowerGroup analyst Charul Vyas. "Banks must invest substantial marketing dollars to increase consumer awareness about mobile banking, as well as remain vigilant regarding privacy and data security in this area."
The TowerGroup predictions follows research released earlier this year by Frost & Sullivan which suggested that there would only be around 21 million mobile banking customers in the US by 2010. However a separate report from Aite Group projected a rise in mobile banking numbers - from 1.6 million in 2007 to 35 million by year-end 2010.