Take On Payments, a blog sponsored by the Retail Payments Risk Forum of the Federal Reserve Bank of Atlanta, is intended to foster dialogue on emerging risks in retail payment systems and enhance collaborative efforts to improve risk detection and mitigation. We encourage your active participation in Take on Payments and look forward to collaborating with you.
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November 19, 2018
Smaller FIs Weigh In on Mobile Financial Services
I have previously written several posts on the Sixth District's 2016 Mobile Banking and Payments Survey results as well as the consolidated results of the 2016 survey involving financial institutions (FIs) in the Atlanta Fed's district and six other Federal Reserve districts. Readers will recall that the primary goal of the survey was to allow the Federal Reserve and industry stakeholders to better understand the status of financial institutions' strategies with regard to mobile banking and payments products and services.
As a follow-up to this work, the Federal Reserve districts of Atlanta, Boston, Cleveland, Kansas City, Minneapolis, and Richmond conducted a "quick-hit" survey in June 2018 of the FIs that did not respond to the detailed 2016 survey. The survey consisted of just five questions pertaining to mobile financial service offerings. It also gathered some demographic data. A total of 565 FIs responded, representing an 11.7 percent response rate. You can find a report that the Payment Strategies Group at the Federal Reserve Bank of Boston prepared on the Boston Fed website.
As a group, the FIs responding to the 2018 survey were smaller in asset size than were respondents to the 2016 survey.
Some of the key takeaways in the report include:
- Of the 2018 respondents, 88 percent of banks and 81 percent of credit unions currently offer mobile banking services or plan to offer them by the end of 2018.
- Fifty-five percent of the respondents reported that more than 20 percent of their customers were active mobile banking users.
- Surprisingly, 14 percent of the respondents indicated they have no plans to offer mobile banking services. All but one of the FIs that have no plans to offer mobile banking had assets under $500 million. These FIs were almost evenly split between credit unions (33) and banks (36).
- Not tracking or being unwilling to reveal customer usage levels of mobile banking services remains an issue; 29 percent of the respondents did not answer the question. My opinion is that it's the latter reason, given that a standard reporting option of mobile banking systems is to be able to track enrollment and unique sign-on activity.
- Offerings of mobile payment services continue to lag significantly behind mobile banking. Of the 2018 responses, 57 percent currently offer or plan to offer them, while 43 percent have no plans to offer them or were undecided.
We will be conducting the detailed Mobile Banking and Payments survey in early 2019 and look forward to sharing the results with you.
By David Lott, a payments risk expert in the Retail Payments Risk Forum at the Atlanta Fed
- A Look in the Rearview Mirror of Payments for 2018
- Building Blocks for the Sandbox
- Smaller FIs Weigh In on Mobile Financial Services
- In Payments, What I Say May Not Match What I Do
- Organizational Muscle Memory and the Right of Boom
- Remote Card Fraud: A Growing Concern
- Three Views of Noncash Payments Fraud
- An Ounce of Prevention
- Safeguarding Things When They’re All Connected
- Racing Ahead in the Wireless Space
- December 2018
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- account takeovers
- ATM fraud
- bank supervision
- banking regulations
- banks and banking
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- emerging payments
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