The incredible gains made towards mobile phone access have seen a solid progress in the scale of innovations originating from exploitation of these practically new technologies. Smartphones and gadgets are benefiting not just the common consumers but the commercial and business sector as well. Mobile banking is one innovation which has steadily rendered itself in invasive ways cutting across various zones of industry and economy.
Mobile phones and its uptake in different countries around the world have been unprecedented. The quick absorption of mobile based banking services is of vital significance. This trend of sustained dependence on mobile services is increasingly gaining momentum. And today the emergence of mobile based banking is on its way of becoming a viable technology not just in industrialized regions but also in developing countries.
An appropriate banking environment is considered the enabler and the key foundation of economic growth. Nowadays, banking has finally found convenient ways of accessing financial resources beyond the traditional norms. Nowadays, handling monetary transactions enters a recurrent expansion and modernization. Thanks to mobile banking for being a reliable and affordable way of holding funds, a piece of opportunity within the banking industry that empowers every customer.
Cutting banks out of the scene
The biggest breakthrough in the mobile payment market takes place in developing countries where bank services are provided by mobile phones. This new way of financial management seeks to cut banks out of the picture. The advent of e-money and online payment networks are convenient conduits for people who have traditionally not held bank accounts, even for those who have adapted the latter and intend to experience fast and hassle-free transactions.
Convenience plus customer empowerment
As a matter of fact, a new target on bringing monetary services to the unbanked – those without easy access to conventional banking channels – corresponds a tactical shift for mobile providers. The very minimal loans and deposits held by poorer customers make them unbeneficial for banks that use traditional delivery methods. But mobile devices trims down the cost to serve clients by 50 to 70 percent, providing the possibility of offering financial services to a vast population once considered unprofitable.
Fast cash replacement via mobile banking
Financial transactions involving cash and cheque are steadily diminishing due to the increasing adoption of alternative ways like ATM, credit-debit cards, internet, and now it’s mobile banking. Experts projected that mobile phones propelled by smartphone and 3G technology will come out undisputed by 2020 considering its expected accounting for 20 to 30 percent of the entire transactions. Currently, almost all banks in India are resorting to phone banking apps, which not only allow the customers to manage money but also provide services like ticket booking, check book request and bill payments.
Google Wallet, a popular virtual wallet for online shoppers is one of the rising mobile apps that save time and money. With this easy and convenient application, Gmail users can send money instantly to their friends and family without going to the bank. Banking institutions have also launched their specific mobile banking apps for their “social” customers, giving them easy access to financial services that goes beyond traditional models.
Wrapping up the whole thing
Cutting down the service costs drastically is the biggest advantage that mobile banking can offer to its customers. For instance, an average phone transaction or average teller costs about $2.36 each, while if you use electronic transaction, it will only cost you about $0.10 each. That’s amazing, right? In addition, this new innovation gives the banking institution the capacity to up-sell and cross-sell their extra complex banking services and products including credit cards, vehicle loans, etc.
For service operators, mobile banking proposes the next surest strategy to achieve development. Countries like Korea where mobile access is in looming dispersion, mobile based banking is helping service providers boost revenues from currently fixed subscriber base. Further, service providers are increasingly using the sophistication of their supported mobile banking services to capture new clients and preserve old ones.