The Evolution of Mobile Banking: Innovations and User Experience

The trend towards digital and mobile banking has been among the most profound technological shifts of recent decades. 

The scope for further innovation in these settings—for fintech startups and neobanks, as well as established players and their partners—remains enormous, with the emphasis falling typically on further advancing user experiences, keeping pace with emergent consumer demands, and making services yet more accessible and ever more seamless. 

Advancing interfaces

Chatbots and virtual assistants such as Capital One’s ‘Eno’ tool, have been around for some years already, but the latest upgrades to tools of this type are helping to significantly evolve mobile banking app interfaces. Bank of America’s ‘Erica’ offering, for example, now available to 25 million or so of the bank’s mobile app users, is an AI-powered chatbot designed to deliver highly personalised customer support.

Erica uses predictive analytics and natural language systems to function effectively as every mobile banking app user’s personal assistant. As such, it works as a conduit between a consumer and all their own banking information. It can also carry out a variety of transactions on request, by voice command or by text instruction, including via Zelle – a lightning quick digital payment solution becoming an increasingly common feature of mobile banking apps globally.

And while big banks like BofA and others are eagerly upping their game around mobile banking apps and their interfaces, startups too are aiming to meet growing demand for smart banking solutions accessible from anywhere. Cleo, for example, is a mobile app that deploys clever AI tech to support users in managing their money, in saving for the future, building up their credit ratings and avoiding expensive debt. The fast-growing fintech startup focusses primarily on Gen Z audiences and has found most of its several million users to date in the US despite having been founded in the UK.

Apps that do everything 

Crucially for banks and rival app-based service providers, consumers globally are increasingly coming to expect that they can carry out any banking task via their mobile device. Indeed, a recent research report from Forrester suggests that across US, UK and Australian markets, roughly two thirds of all consumers think that mobile apps should cater to a full array of their banking needs.

That growing expectation underscores the importance of open banking to the future of digital finance, allowing as it does for consumers to open up access to their own financial data to trusted third parties in return for access to newer, more integrated financial solutions. 

Crucially, secure APIs mean that only authorised service providers are ever allowed to access consumer data but the potential for openness within those strict parameters creates space for banks and fintech startups to meet demand for ever more personalisation, integration and empowering mobile banking solutions. 

The transparency encouraged by open banking and embedded within a growing variety of mobile banking interfaces also serves to streamline processes involving credit checks and loan applications. Indeed, the in-built transparency that underpins many of the latest mobile banking apps creates opportunities for consumers to access credit options that might otherwise have been unavailable to them. 

Seamlessness and convenience

Digital wallets too have contributed massively to putting smartphones at the heart of relationships between contemporary consumers and their finances. The associated technology, now a common feature of mobile devices worldwide, enables billions of payments and other transactions annually and has quickly transformed the ways that millions of people pay routinely for goods and services online and in person.

Importantly, digital wallets offer enormous flexibility of function, with users able to keep all manner of digital assets in them, and on their mobile devices, from plane tickets and boarding passes, to gift cards and drivers’ licenses. All such items being available digitally in the same ‘wallet’ while also being transferable from one wallet to another, or one device to another, creates incredible flexibility and convenience for consumers. 

Alongside the evolution of mobile banking apps, digital wallets have helped turn smartphones into personalised financial management hubs, opening up vast opportunities for fintech innovators to deliver increasingly powerful and impactful financial solutions at everyone’s fingertips.

Powerful personalisation 

Digital banking as a general phenomenon has become almost ubiquitous in recent years and its spread globally has made access to basic financial services a reality for billions of previously underbanked people. That evolution is sure to continue as the few remaining parts of the world where a lack of banking remains a real problem start accessing and integrating digital banking services.

Within that broader trend, mobile banking advancements are expected to set the pace and increasingly define what it means to bank as a contemporary consumer, right across the globe. Allied Market Research estimates that the digital banking platform market will grow from a value of around $30 billion in 2023 to around $168 billion in 2032. 

The research company points to mobile banking as the segment of the wider market set to grow fastest over the next few years, partly because smartphone use is sure to continue growing, but also because innovation around AI and smart bots is expected to lead to more enhanced personalisation and higher standards of real-time customer service.      

Undoubted demand

There is certainly no shortage of demand for mobile banking apps that deliver high levels of seamlessness and convenience. A recent PYMNTS Intelligence study found that over half of all consumers across Gen Z, Gen X and Millennial age brackets already use mobile apps as their primary banking tool, with 81 per cent using mobile devices to manage their bank accounts at least once a month.

The same research found overwhelmingly positive views among consumers generally on the impact of digital banking solutions and the associated technologies. However, there remain lingering concerns among consumers across the board about issues of cybersecurity and fraud, an area of consideration always high on the agenda for any banking sector service provider. 

Revolution plus evolution equals opportunity 

Digital banking has transformed the global financial sector in recent years, changing the ways in which billions of people relate fundamentally to their own money along the way. Mobile banking is well-established at the heart of that digital banking revolution, and further change across the landscape appears inevitable.

Smart collaborations and adaptations will likely be necessary for traditional banks to survive and to thrive in that environment, while for the sharpest of innovative fintech startups and their investors there is no doubting the potential of mobile banking to represent fertile terrain well into the 2030s and beyond.