How are Technological Advances in Mobile Banking Transforming the Financial Ecosystem?

Highlights:

• Introduction
• Recent trends in mobile banking
• SBI’s new handheld device
• Profitable acquisitions in the domain

In recent years, rapid digital explosion has reshaped several businesses and lives of individuals significantly. The banking and finance industries have also undergone transformative change to meet the evolving demands of the consumer base. Nowadays, most people prefer smartphones to manage their finances and avoid inconveniences of traditional banking since they are also accessible and hassle-free. This has paved the way for the rise of mobile banking concept. Mobile banking is a financial service that includes the use of mobile devices such as smartphones and tablets to access and manage one’s banking accounts and various financial transactions.

Latest trends in mobile banking reshaping the financial ecosystem

Mobile banking landscape is constantly evolving over the years. Biometric authentication has emerged as one of the latest trends in mobile banking services. Now, various mobile banking apps include fingerprint and facial scanning to offer added security measures for their customers. This type of authentication process ensures customers access mobile banking services securely.

Furthermore, incorporating bots in mobile banking apps is expected to be the primary channel for the adoption of conversational technology in the future. According to a study, it is found that chatbots interactions will be deployed among 79% of businesses around the world in the coming years. These apps are utilizing this new technology to improve customer experiences by maximizing the use of machine learning and artificial intelligence algorithms to anticipate customer needs.

Moreover, blockchain technology has emerged as a key tool in the banking and finance sector, enabling users to make transactions by eliminating the need for physical third parties. This technology allows for the monetization of data securely with statistical analysis which plays an important role in mobile banking services. Additionally, as this technology is developed using cryptography methods, banks and financial companies are expected to maximize its use for protecting sensitive data across the domain.

SBI’s mobile handheld device

In October 2023, SBI, an Indian multinational public sector bank announced the launch of its new Mobile Handheld Device to provide banking services to its financial inclusive customers. By launching this product, the bank aimed to enhance accessibility, and offering convenience to its customers in availing banking services and empower financial inclusion. This handheld device is set to revolutionize banking accessibility by providing kiosk banking solutions directly to customers at their finger touch. It offers greater flexibility to customer service point agents, enabling them to reach out to customers wherever they are. This initiative will benefit customers with health issues who face challenges in accessing customer service point outlets. Such kind of innovative steps taken by leading banks in India, the mobile banking sector in the country is expected to rise at the fastest CAGR of 23.8% from 2022 to 2032.

Key alliances by top players that businesses in this sector should look into

To foster the industry’s competitiveness, several leading players in the mobile banking industry have made alliances such as mergers, acquisitions, partnerships, and collaborations. For instance, in June 2023, UBS, a global firm providing financial services announced its acquisition of Credit Suisse, a global investment bank and financial services firm. With this acquisition, the organizations aimed to start operating the consolidated banking group to serve their clients with excellence. The firms also envisioned presenting their clients with an enhanced global offering, broader geographic reach, and access to even greater expertise by offering unparalleled digital platforms.

Similarly, in February 2024, MUFG Bank, a renowned Japanese bank acquired a huge share in robo-advisor WealthNavi to expand its digital financial services. By making such heavy investment and business alliance, MUFG Bank aimed to enhance its financial offerings by embracing digital transformation and improve customer experience through advanced technology. Moreover, WealthNavi would also help individuals build diversified investment portfolios for long-term wealth growth.

To conclude, continuous investments made by top banks in the boosting their mobile banking applications, owing to the rise of cutting-edge technologies such as bigdata, blockchain, and chatbots is expected to bring new opportunities for the sector in the coming years. Furthermore, the increase in the prevalence of digital transactions has prompted the development of advanced cybersecurity measures within mobile banking apps, continuing the growth and importance of mobile banking sector.

To identify emerging opportunities in the mobile banking industry, feel free to talk to our industry analysts today! They can also help you identify potential investment opportunities across several regions.

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