The analysis shows mobile banking adoption is associated with lower attrition, use of more products, and an increase in transactions, resulting in increased revenue for financial institutions that offer the service.
The study included eight credit unions and nine banks and evaluated data from more than 67,000
mobile banking users. Researchers looked specifically at the actions of mobile banking users three months before and three months after they started using the service.
In addition to affirming that mobile banking use is associated with lower attrition, the study revealed three key insights:
Increased Product Holdings — Average product holdings, including loans, certificates of deposit, credit cards, and mortgages, increased noticeably following adoption of mobile banking. Mobile users had an average of 2.3 products from their primary financial institution, versus 1.3 for their branch-only peers, an increase of more than 75%.
Increased Transaction Frequency — In the three months after adopting mobile banking, users increased the number of debit and credit card transactions, ATM transactions and ACH transactions they made. This is significant because many transactions generate revenue, such as interchange revenue from card transactions.
Higher Average Revenue — Mobile banking users generate more revenue than nonusers due in part to the fact that they own more products and conduct more transactions. For credit unions, members that use mobile banking generate 36 percent more revenue compared to branch-only members. Banks saw 72% higher revenue from mobile users compared to branch-only customers.
“The financial institutions in this study are seeing tangible revenue from mobile banking,” said Matt Wilcox, senior vice president, marketing strategy and innovation, Fiserv. “Marketing mobile banking and highlighting how it can help consumers keep pace with the speed of life is absolutely essential if financial institutions want to grow adoption and use of the service and reap the benefits of their mobile investment.”
The white paper shares guidance for financial institutions on how to drive mobile banking adoption and usage, such as showing how the service is relevant to peoples’ lifestyles and engaging staff as advocates.