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If a mobile banking app makes you think of depositing checks and discovering your balance quickly, you’re in good company. These are classic tasks.
But a growing number of banks are adding features to their mobile apps that go beyond the basics — including helping you avoid unwanted charges and track your spending habits. These features might be critical to customers’ lives at a time when most consumers are struggling to save.
“Your bank should be doing a lot more to help with your financial health,” says Zachary Smith, senior vice president of product at Chime, a digital banking provider.
According to J.D. Power’s 2022 Retail Banking Satisfaction Study, 46 percent of customers say they want their bank to help them avoid fees and 37 percent want to receive account alerts. These are two areas where mobile banking apps can serve as a solution.
Here’s what you need to know about what you can get from a mobile bank app today, and what to expect next.
Mobile banking statistics
- A vast majority (87 percent) of consumers use their mobile banking app at least once a month.
- Millennials prefer to use their banking app the most of all generations with 93 percent reporting so, followed by Gen X (90 percent) and Gen Z (89 percent).
- The mobile banking feature that increased the most in usage over the past year is one that can help customers request a card replacement — 54 percent of customers use this feature, a 5 percent increase since a year ago.
- To have a more personalized bank experience, nearly half (46 percent) of consumers say they want help from their banks to avoid fees, and 37 percent want to receive account alerts.
- As a primary method for accessing bank accounts, mobile banking is more likely to be used by those with some college or a college degree than by those with no college experience.
- Mobile banking also had the highest reported usage for households with higher incomes.
Expense tracker to show spending and savings patterns
In Bankrate’s recent emergency savings report, it was found that only 43 percent of consumers surveyed would cover an emergency expense of $1,000 or more with savings. Many consumers are struggling to stay on top of their finances and avoid going into more debt.
Banks know we’re in a precarious setup — institutions regularly ask for our feedback and they see our transaction data. They know where we spend our money, how much we make, what kind of bills we have and much more. They also know that they have an opportunity to supply us suggestions about what to do through their mobile apps.
Mobile banking apps can do this through alerts for upcoming bills, overdrafts and other charges a consumer should be aware of. U.S. Bank’s app, for example, will give customers suggestions for when they can afford to put, say, $50 into a savings account. It will also notify them when their recurring payments have changed, if a merchant charges them twice for a single item and much more.
“Customers really expect financial services firms to leverage what we know about them and anticipate their needs — so it helps them better manage their finances moving forward,” says Ankit Bhatt, chief digital executive at U.S. Bank.
Many institutions are now offering predictive tools that help customers manage their spending. Huntington Bank launched a digital banking feature called Heads Up that predicts what a customer can afford to spend, when a merchant mistakenly double charges your card and more. Bank of America’s virtual assistant, Erica, now flags customers when a recurring charge or membership fee increases.
Digital wallet integration
Digital wallets are increasingly becoming a norm as more retailers adopt cashless payment methods. According to a recent survey by consulting firm McKinsey, over two-thirds of U.S. consumers expect to have a digital wallet within two years.
A digital wallet might be provided by a bank, a smartphone manufacturer or a third-party service. It allows consumers to store money digitally and make payments using their smartphones, and it helps them avoid fees, since there’s generally no fee for sending money to someone using a digital wallet. Some common examples include Apple Pay, Google Pay, Zelle and PayPal.
While many popular digital wallets aren’t directly provided by banks, banks can make digital wallets more accessible for consumers by making their bank accounts compatible with digital wallets or even integrating third-party services into mobile banking apps.
For example, there are nearly 2,000 banks that offer Zelle through their mobile banking app. Zelle allows users to send and receive payments between peers without paying a fee.
Seven big banks — including Bank of America, Wells Fargo and JPMorgan Chase — are also teaming up to launch a new digital wallet, with plans to roll it out in the later half of 2023. The wallet will be linked to shoppers’ debit and credit cards.
While digital wallets make it a lot easier to pay for things, they also potentially make it easier to get scammed. In many cases, you only need a phone number or email to verify who you’re sending money to, so make sure you only send money and make payments to trusted recipients.
Increase in financial security and transparency
With all of the subscriptions, apps, services and accounts we’re linked to, it’s easy to lose track of where your information is going, what it’s used for and how you’re being charged. But mobile banking apps can help organize that information and track it for you.
Wells Fargo, for example, offers a number of features through its app that give customers more control over their bank information. Users not only can turn their debit cards on and off instantly, they’re also able to track recurring payments (like subscriptions), linked accounts and which devices your cards are connected to.
Many banking apps additionally offer insights into where your data is being shared. With the Bank of America app, for example, customers can see which third parties have access to their data in the Security Center tab. Greater transparency around how their data is stored and used can allow customers to look out for anything suspicious, and it can build trust between customers and their banks.
Tackles the emergency savings crisis
Many consumers are concerned with their level of savings. According to Bankrate’s emergency savings report, 68 percent of people are worried they wouldn’t be able to cover one month of living expenses with their savings if they lost their primary source of income. Without adequate savings, many consumers have to rely on credit cards, loans and other forms of debt that could set back their finances for the long run.
A number of banks are now offering mobile tools that can help you save and mitigate financial insecurity. Ally Bank’s app, for example, has a Surprise Savings feature that analyzes your checking account and spending history and automatically transfers a specified amount that it deems safe-to-save into a savings account.
Other banking apps, such as Varo’s, boost savings by rounding up change from transactions and moving that amount into a savings account. Varo’s app also allows customers to choose a percentage of their direct deposit to be moved into their savings account each month.
Access and redeem rewards points
Though banks offering cash back and other rewards for using their debit and credit cards is nothing new, the integration of rewards in mobile apps offers a sleeker and easier opportunity to earn rewards.
Bank of America, for example, now offers a whole platform within its mobile app dedicated to cash back rewards called BankAmeriDeals. In the app, users can browse through all of the stores and deals that are eligible for cash back rewards when they pay with a BofA debit or credit card. That makes it easy for customers to quickly look at what rewards they’re eligible for when they’re already out and about shopping, so they can maximize their cash back. The app also lets users view all of the cash back rewards they’ve earned.
Other banks may offer points that are earned when you spend on certain purchases, which can be redeemed in a mobile app. U.S. Bank is one bank that’s made it easy for customers to redeem points whenever and wherever they like. Customers simply open the bank’s mobile app and can navigate to a rewards tab, where points can be redeemed for credit, merchandise, gift cards, travel and more.
What’s next in mobile banking?
Expect your mobile banking app to only get better at helping you handle your money as partnerships with fintech companies are made and mobile releases continue to regularly drop.
There are two areas identified as potential gaps in mobile banking app satisfaction by J.D. Power’s U.S. Banking Mobile App Satisfaction Study. One of those is addressing the needs of financially vulnerable consumers. Banking satisfaction for financially vulnerable individuals scores much lower than those considered financially healthy.
The other area where mobile banking still falls short is personalization. Consumers who primarily bank through digital channels are less likely to say they have a personal relationship with their bank than those who primarily bank at a branch, by a margin of 20 percentage points. Banking technology may evolve to become more personalized, which can further help improve customer satisfaction.
Bear in mind, it’s a vast playing field out there — every bank’s app has its own variation on features offered. The best mobile bank apps are driving new innovations in digital banking. What a bank offers through its app can greatly influence where someone decides to bank, since these apps have become closely tied to helping you save and managing your money overall.