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Understanding the Digital Banking Trend – When banks must blend with Millennials’ lifestyle

DIGITAL VENTURES September 29, 2017 7:50 AM


In transactions such as paying bills, issuing checks, and P2P payment, undoubtedly, customers seek for the smoothest and most secure experience. Therefore, financial institutions need to adapt and pursue innovation that can develop services that best support consumer needs. Online banking is a tangible evidence of such gesture. Today, we will look into the digital age consumer behaviors in a tech-leading country such as the USA. What are the trends and where are they heading? USA-based, Fiserv, a leader in financial services technology solutions, has the research.

Digital Banking – The difference is in the platform

Internet banking is a service provided by the bank for customers to complete financial transactions on the bank’s website. Services range from balance inquiry, transfers, bill payment, and other transactions. On the other hand, Mobile banking is when customers complete their transactions via smartphones or tablets. These banks on mobile enhance convenience. The applications on mobile phones of different banks will have additional features along with the basic services. Both the internet and mobile banking are Online banking as they require the internet to access the services, the difference is in the platform.

Fiserv’s research reveals that today, users in the USA are gradually switching to online transactions. The top 5 transactions complete online are 1. Bill payment (75%) 2. Transfers (60%) 3. Online invoice request (35%) 4. Notifications (35%) 5. Loan payment (28%)

Mobile Payment – Shifting trend in the digital payment era

Although traditional payment via post or directly to another person still exists, today, online payment and mobile payment in the USA has increased to 59%. The shift to the digital platform has contributed to customer satisfaction. It has been observed that online payment users rate their satisfaction at 8 out of 10 for speed and convenience that surpass the traditional methods. Unquestionably, users enjoy the choice of payment via banks, service providers, or retailers such as Starbucks where only a mobile phone is required.

Different Generations, Different Behavior – Millennials prefer speedy transactions

Real-time transaction is what differentiates Internet and Mobile Banking from other platforms. While Gen X view real-time transactions as somewhat significant, 93% of Millennials from 18-36 years old, or those born between 1980-1999 see real time as a very important factor. They would say, “Whether it’s deposits, withdrawals, or anything, we want it now”.

This generation grew up with technology so they are not afraid to experiment new things. Researchers reveal that this generation significantly prefers online or mobile payment when compared to the previous generation. In services such as mobile payment, P2P payment, and digital wallet, this generation prefers them 3 times higher than the previous generation, as seen in the graph below.

What about mobile banking in Thailand?

In Thailand, online transactions are gaining popularity and the numbers are increasing. The Bank of Thailand reveals that, in 2016, Thais’ online transactions via mobile banking shows an increasing rate of 20.8 million bank accounts from 13.92 million accounts at the end of 2015. A survey of respondents residing in Bangkok discloses that most Bangkokians have used online transactions, mostly via mobile banking. Therefore, we see financial institutions become more aware of technologies and continue to develop applications to better serve customers and blend with their lifestyle. For instance, the SCB EASY Application by SCB is not only an application for financial transactions but they have added functions for easier payments such as the digital payment via QR code, cardless ATM, and providing discount promotions for products and services. Moreover, users can personalize the application to fit their personal preferences. These are examples of how a simple mobile banking service can become a lifestyle banking.

This is the time that industries need to better understand their target users, continue to update trends, and see where technology is heading. They need to always look to the future and speedily adapt. We have other interesting blogs about online transactions, learn more at An Overview of Mobile Payment in Thailand at the DV Blog.