The document discusses the rise of mobile banking and how it has transformed consumer behavior, with bank visits dropping significantly from 1995 to 2012. It emphasizes the importance of mobile services, innovations, and convenience as key drivers for customer retention and satisfaction in financial services. Various case studies illustrate successful mobile banking strategies and platforms that cater to both banked and unbanked populations, highlighting the dynamic landscape of digital commerce.

1. Mobile and financial services
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@InnovationSoc
July 2013

2. The rise of
mobile banking

3. Experts are pointing at a ‚lossof physicality‛
In 1995 the average EU
consumer made 2.21 visits per
month to the bank.
By 2012, that figure had
dropped to 0.26 visits, which
equates to 3.2 visits per year.

4. Consumershave shownmountingenthusiasmfor mobile services
* TNS. Mobile Life. June 2012
‚All the figures are pointing to the fact
that we have reached a tipping point in
worldwide desire for mobile financial
services. Globally, people are opening
their minds to using their mobile to bank
or buy‛*.
James Fergusson, Global Head, TNS Connect

5. Mobilesare evendisplacingPCsfor the mostroutinetasks
‚Mobile banking is displacing online banking. Technologies
like apps let customers perform simple banking tasks
more quickly and easily on a mobile or a than on a PC. As
a result, banking on Smartphones and tablets is already
displacing banking on PCs for routine interactions.
Over the coming decade, Smartphones, tablets, and other
portable devices will become the dashboard through
which many customers, both rich and poor, manage their
money.‛
Forrester

6. Strategies being
employed

7. The challenge is to develop a strategy that creates value
Ultra convenience
and innovation
Capturing new
markets
Digital
commerce
Creating moments of
truth and delight
ACQUISITION
ADVOCACY
COST SAVINGS
Acting as the engine that
drives digital commerce
Develop alternative
offerings
NEW REVENUES
ACQUISITION
Forrester. Building A World-Class Mobile Banking Strategy. March 2013.
McKinsey. The current state and future of mobile banking in Europe. August 2011
Short term
imperative
Long term
Leadership
ADVOCACY
ACQUISITION
EQUITY

8. Ultra convenience and
innovation
Making the usual everyday business dramatically more convenient. Why?
Because nearly a third of mobile banking users are more likely to stay
with their bank as a result of their mobile banking experience.
BENEFITS
To increase satisfaction, retention and advocacy by deepening
relationship with customers
To acquire new customer with a distinctive proposition
To cut costs by directing everyday transactions from other channels
(e.g. Branch) to mobile
Forrester. Building A World-Class Mobile Banking Strategy. March 2013.
McKinsey. The current state and future of mobile banking in Europe. August 2011.
Bain and company. Customer loyalty in retail banking. Global edition 2012.

9. What are the
moments of Truth?
And how can we create
a ‚wow‛ effect?
What are the
biggest frustrations?
How can innovations
lead to improvements?
Those moments of truth (such as resolving a fraudulent transaction) and
‚digital delight‛ moments providing new, easy ways for customers to do
routine transactions (such as mobile bill pay) prove decisive in winning
either customers’ advocacy or their derision.
McKinsey. Retail Distribution 2015 – Full Digitalisation with a human touch. Dec 2011
Bain and company. Customer loyalty in retail banking. Global edition 2012.
How to consolidate
these positive
experiences into an
overall propositions?
Customers with a higher frequency of
mobile transactions are more likely to
recommend their bank than low-frequency
users. This is not about one-offs but
developing an overall vision.
Ultra convenience and
innovation

10. Inspiration: boosting customer service
IBM Watson
IBM's cognitive supercomputer Watson will
soon be helping several of the company's
most important customers like Australia’s
ANZ Bank and Royal Bank of Canada
Watson's new role, called "Ask Watson," is to
help brands answer customer service queries
via a combination of websites, cloud
services, email, SMS and Smartphone apps.
Companies will tap his ability to use semantic
searches to make him a formidable customer
service assistant.
‚From a consumer point of view, being able to
access a brand's customer service function via
a Smartphone app AND to have your query
dealt with efficiently by a super computer is
a compelling prospect.‛ Contagious
Contagious. Ask Watson. May 2013
Forbes. IBM's Watson Now A Customer Service Agent, Coming To Smartphones Soon. May 2013
Ultra convenience and
innovation

11. Digital commerce
Its not just about purchase:
- Pre-purchase phase - combining data to deliver event- and location-
based discount offers
- Purchase financing - instant credit available at point of sale via SMS
and mobile apps
- Transaction processing - bank-enabled mobile e-wallets replacing
cash and cards
BENEFITS
To generate increased revenue by
-Leveraging data to facilitate context-sensitive merchant offers
-Capturing share of increased digital payment volumes
Forrester. Building A World-Class Mobile Banking Strategy. March 2013.
McKinsey. The current state and future of mobile banking in Europe. August 2011

12. 1. Connect
merchants, brands
and shoppers through
buying and saving
opportunities
Only those who partner up will
survive – as only by partnering
can you create extended
experiences
2. Focus on
prepayment and
postpayment
activities
‚Before‛ services incl.
geolocation, targeted
ads, promotions, social marketing, services
raising awareness and influence purchase
preference.
‚After‛ services incl.
remarketing, loyalty programs, customer
support, and cross-selling/upselling
activities
Accenture. Mobile Commerce: A Roadmap for Banks and Mobile Operators. 2012
Digital commerce

13. A variety of new players are
entering the
market, including tech
specialists such as
Google, start-ups such as
Square, and established
online payment providers
such as PayPal.
Google in particular has bold
plans: It wants to close the
last mile and is willing to
give away everything to
merchants (including point-of-
sale terminals, digital
wallets, and Trusted Service
Manager [TSM] services) to
make this happen.
Digital commerce

14. New Markets
Key opportunity to use mobile to access the world’s 2.5 billion adults
who are either unbanked or underbanked.
Non-incumbent ‘attacking banks’ may more easily be able to build a
low-cost proposition in partnership with an established Telco.
BENEFITS
-Growing market share with a disruptive proposition
-This could support a broader vision and purpose and boost long term
brand equity
McKinsey. The current state and future of mobile banking in Europe. August 2011

15. M Pesa has led the way in
Kenya, making possible for the first
time person-to-person transfers and
facilitating international
remittances.
A striking 51% of Kenyan adults use this
system making it the most successful
mobile money deployment
worldwide.
New players in such markets are
integrating existing mobile payments
platforms with online
merchants, bank accounts, and
microfinance platforms.
Deloitte. Banking the unbanked Prepaid cards, mobile payments, and global opportunities in retail banking. 2012
New Markets

16. Case studies:
who’s innovating?

17. Chase:best in classfor overall visionand experience
Chase regularly tops the list of financial institutions that
provide the most comprehensive and intuitive mobile
banking offerings.
Chase Mobile includes the following features:
-Chase QuickDepositSM, the award-winning mobile
check deposit capability;
-Chase QuickPaySM, its proprietary person-to-person
payment service;
-Payment options such as bill pay, account transfers
and wire transfers;
-Mobile website access;
-SMS text messaging;
-Chase Instant Action Alerts to notify customers of a
low balance, and to allow them to transfer money by
replying to the text message.

18. Westpac:ImpulseSaver
INSIGHT:
Westpac bank promises to help New Zealanders use money to
get where they dream of being. But their appalling savings
behaviour was preventing this as they were 23rd out of 29 OECD
nations in terms of saving habits.
SOLUTION:
Inspired by a TED Talk by Rory Sutherland in which he noted
that "marketing has done a very good job of creating
opportunities for impulse buying … we've never created the
opportunity for impulse saving“, Westpac created an impulse
saving product.
The bank created an app that interfaces directly with online
banking allowing customers to transfer a predetermined amount
from their transactional account to their savings account at the
touch of a button.

19. Permata/ BlackBerry: BBM Money
INSIGHT:
People increasingly use their phones to manage many aspects of their
lives. Enabling users to make quick payments to each other – such as
splitting a bill in a restaurant or helping small traders to collect
payments from regular customers is an attractive prospect.
SOLUTION:
BlackBerry has partnered with Indonesia’s Bank Permata to develop a
mobile payment service.
The company is testing a system whereby Indonesians will be able to
use the chat service, BlackBerry Messenger, to transfer money to their
friends.
Users can send or receive money by downloading the BlackBerry
Money app. It is free to send money to BBM users who bank with
Permata, while it costs 5,000 rupiah ($0.52) to send money to
customers of other banks.

20. Barclays:Pingit
INSIGHT:
As per BBM
SOLUTION:
Barclays’ Pingit is an app that allows account holders to transfer
up to £300 a day to other people - using just their mobile phone
number.
It has stood out for its incredible simplicity:
First of all, customers download the app and link it to their
current account and UK mobile number.
To make a payment, you choose a recipient from your contacts
(or type in a mobile number), then select how much to send and
confirm payment.
People without Smartphones can still use the service via text
message, but first need to register online.
Non-Barclays customers can register online to receive Barclays
Pingit payments.

21. TheCommonwealthBankof Australia:PropertyGuide
INSIGHT:
CBA needed to counteract aggressive mortgage rate pricing by
targeting customers who weren't just searching for the lowest
home loan rate but also needed a trusted source of advice to
walk them through the buying process.
SOLUTION:
Using augmented reality and Google maps, the Property Guide
app gives home buyers a virtual insight into 95% of Australian
homes.
It maps data such as sales history and current property listings
on a real world view, and gives users key suburb insights such
as demographics, median price and buy/sell guides.
Financial tools and advice including calculators, videos and
guides are also featured to ensure that the home and loan they
choose is the right one for them.
Click to call and 'arrange an appointment‘ functionality allows
instant access to the Bank once the buyer is ready.

22. Aviva:Drive
INSIGHT:
Insurance is a competitive market with little
to differentiate between providers. Consumer behaviour is
now normalising towards seeking the lowest cost from price
comparison websites.
SOLUTION:
To stand out in this competitive market place Aviva
demonstrated that they recognise individuals and are able to give
policies and competitive prices that are based on individual
driving habits (for car insurance) rather than broad consumer
demographics and associated risk profiles.
The brand developed a mobile app that utilises telematrics on
Smartphones to record driving habits, in order to get a discount
on new insurance policies based on how you drive.
After driving for 200 miles you are given a score out of 10 and
this score is used to calculate discounts the motorist has earned.

23. Visa:MobileManagedService
INSIGHT:
Building on the success of M-Pesa, there is an opportunity for
financial services companies to help maintain these services as
demand grows.
SOLUTION:
Visa has launched a new off-the-shelf mobile money platform
that aims to make it easy and cost-efficient for financial
institutions and mobile network operators to offer mobile financial
services to the ‘unbanked’ consumers.
The Visa Mobile Managed Service allows those without a bank
account in developing countries and elsewhere to still make
payments, buy goods, send remittances and store value on their
mobile phone devices.
Unbanked consumers in India and Rwanda are the first to benefit
from the service.

24. Three golden rules

25. Think UsefulIt has become crucial to create valuable and useful product
experiences that enrich customers’ lives as they will reward
companies that help them to do more.
Companies address this shift by listening and working with
customers in order to become, and stay, useful.

26. Think relationships
Customer resentment was already running high
before the financial crisis. Since then, trust has
plummeted even further.
Re-instating relationships require words and actions
to rebuild both affective and cognitive trust. So we
need to look for more opportunities to interact and
each time make sure we add value.
Pace in
which trust
is restored
Quality of
interactions
Frequency
of
interactions
= X
Reinventing Financial Services: what consumers expect from future banks and insurers. Roger Peverelli, Reggy de Feniks.
McKinsey. Banking on customer centricity. Apr 2012

27. Think small
We learn in small steps. We need to experiment and place
lots of small bets. This should help shift emphasis from
saying to doing.

28. @NadsBads
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