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Speed, Change and Mobile Banking

I am reading an interesting book titled Bank 3.0 by Brett King.  In this book King discusses the revolution and upcoming demolition of traditional banks in light of mobility.  Here are some interesting numbers from the book:
  • In 1980 - credit cards took 14 days to approve, personal loans 7-14 days, home mortgages 30+ days.
  • In 2008 - credit card were instantly approved, personal loans pre-approved/24 hours, home mortgages 24 hours.
The increase in speed between 1980 and 2008 was primarily the result of the internet evolution and e-commerce.  Now jump forward to 2013, and mobility is the cause of the next increase in tempo.  People with mobile devices want instant access to their personal account information.  They want their business relationships and shopping experiences to be wonderful, convenient, digitized and instant.  

My wife is my guide in this area.  She wants a great mobile app from any company we work with.  She directly associates the brand quality with the mobile app quality.

We are quickly coming up on a time when banks need to completely rethink their purpose and retool.  Many of us receive our paychecks electronically.  We receive and pay our bills electronically.  We use debit and credit cards for most transactions, and checks are nearly obsolete.  This is the digitization of banking.  The less cash we use, the less need for ATMs, and the less need for bank buildings. 

Our mobile banking apps become our bank, and banking is a service that is offered by our mobile apps.  Research shows we access our banking information many times more in a year via a mobile app than through our bank branch.  The unstoppable trend is already here.  

King points out in his book, that once banking becomes "unhinged" from a physical building, banking becomes a "thing" that can be offered by many different kinds of companies.  Suddenly banks find themselves competing with a new and massive number of different companies offering a variety of traditionally bank only services.

Traditional banks need to immediately understand the mobile app is the new bank, and services will include mobile banking, mobile payments, e-wallets, financial services, advice, social interactions, guidance, gamification of our financial plans, Big Data comparisons with others in our demographic etc. Competition will come from companies far outside of traditional banking circles.
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Kevin Benedict, Head Analyst for SMAC, Cognizant
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Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I am a mobility and SMAC analyst, consultant and writer. I work with and have worked with many of the companies mentioned in my articles.

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More Stories By Kevin Benedict

Kevin Benedict is the Senior Analyst for Digital Transformation at Cognizant, a writer, speaker and SAP Mentor Alumnus. Follow him on Twitter @krbenedict. He is a popular speaker around the world on the topic of digital transformation and enterprise mobility. He maintains a busy schedule researching, writing and speaking at events in North America, Asia and Europe. He has over 25 years of experience working in the enterprise IT solutions industry.