Digital banking success is critical for financial institutions in 2017.
But, that customer engagement and brand loyalty that accompany digital banking have fallen off, according to a new study from ath Power Consulting, a leading financial services research and strategy firm.
The report, The ath Power Consumer Digital Banking Study™, provides a detailed assessment of digital banking usage, offerings, delivery methods, and customer experiences at financial institutions nationwide.
Based on more than 3,000 survey responses collected in January 2017, study findings revealed that almost 80 percent of respondents consider digital banking their preferred way to bank, while 91 percent feels that digital banking is important to their overall banking needs.
Further results, however, reveal that 65 percent of consumers are highly satisfied with their digital banking solutions, which is a decline from 73 percent in last year’s study.
“The heightened expectations of today’s tech-savvy consumers combined with the lack of advancement and improvement of their financial institution’s digital solutions have certainly contributed to this drop in satisfaction,” said Frank Aloi, ath Power Founder and CEO. “To maintain a competitive edge, FIs must move beyond basic functionality and accelerate their pace of innovation. For those already offering advanced capabilities, our research revealed that some solutions are not yet acceptable in terms of usability, causing frustration among consumers.”
Study results found that online account opening is a desired feature with 81 percent of respondents likely to open a loan account online and 69 percent likely to open a checking account online if the options were available.
More than half attempted the process, however, almost 30 percent had to abandon it at some point. The primary reasons for abandonment included the application process being too lengthy (42 percent) and too complex (39 percent). If the process could be simplified, FIs would see higher rates of completion, the study says.
Of those who completed the process, 85 percent did so on a computer and 12 percent used an FIs’ website via their mobile devices; only 3 percent of applications were submitted via a mobile app.
What’s more, 64 percent of consumers are interested in using all types of mobile payments.
Specifically, person-to-person payments (P2P) are growing in popularity, with 44 percent already using this feature. Clearly, consumers are more trusting of their financial institutions, but many still choose non-bank providers for their fast, free, user-friendly mobile apps.
“In our study, just under three-in-10 respondents indicate a likelihood to leave their current financial institution,” said Ed O'Brien, ath Power’s EVP Research and Strategy. “With this potential for attrition in addition to competition from alternative solutions that rival traditional bank digital offerings, it has never been more critical for financial institutions to deliver advanced, well-designed digital platforms.”