Banking apps must up their game to grab Millennials' interest
Sep. 14, 2016
While mobile devices continue their triumphant advance in the digital arena, the world’s leading retail banks are struggling to keep up with the fast-paced development of the innovative digital features their customers demand. This innovation gap poses significant risks for established financial players as they face increased pressure from new digital challenger banks and a customer generation of digital natives that quickly lose patience when their digital needs are not met.
These are key findings of the report of the report “Mobile Apps for Banking 2016 – Tech-Savvy Clients Let Down by Shortcomings” that analyzes and ranks, for the fifth year running, the mobile apps of 35 leading retail banks worldwide and, where applicable, the Apple Watch apps. In total, 140 apps were assessed according to 49 criteria for mobile apps and 11 for Apple Wantch apps. The report benchmarks, among others, core functions for customers; innovative add-ons; content and features for marketing and strategy and navigation. The apps offered by seven digital challenger banks were evaluated as well.
The research data reveal that most banks have a solid track record for many of the must-have features, such as account overview (79% of maximum possible benchmarking points) and convenient payment methods (88%). However, there is a pronounced lack when it comes to innovative features like chat and messaging functions (29% of the maximum points), interactive content to help and educate customers (31%) and digital tools to help customers get a grasp on their personal finances (41%). The report details the strengths and weaknesses for all relevant features and functionalities for the banking sector overall and separately for each analyzed bank.
Majority of retail banks at risk of losing out to digital challenger banks
The majority of retail banks are not responding adequately to their target clients’ digital expectations, which are driven by the strong trends detailed in the reports. For example, banking clients are switching from being passive consumers of account information to actively managing their personal finances through powerful mobile apps. Banks must respond effectively to these trends and the report outlines how they should adapt their mobile app offerings accordingly.
At present, the banking sector shows in many respects an inability to innovate and catch up with society’s wider trends of digital innovation. This is an alarming development, as gaps and shortcomings in retail banking apps expose a clear risk that new nimble competitors, so-called digital challenger banks or neo-banks, will take advantage of the established players’ weakness and make substantial inroads – particularly with the Millennial Generation. The report profiles seven digital challenger banks and explains which innovations are required to appeal to this new generation of clients.
BNP Paribas, Société Générale, UBS and Deutsche Bank top overall ranking
The top performers in our analysis continue to enhance and evolve their mobile apps in an effort to keep pace with new technologies and the steadily rising bar of client expectations. This year’s winner in MyPrivateBanking’s benchmarking is again BNP Paribas with 70 points out of 85. Three banks share the second rank this year: Société Générale, UBS and Deutsche Bank, each of which achieved 68 out of 85 possible points. The fifth rank goes to DBS (66 out of 85 points).
Full rankings of the 35 wealth managers’ mobile app offerings and their performance for each of the 49 evaluation criteria are detailed in the report and in a comprehensive data appendix. In addition, the results for each wealth manager are summarized in individual profiles, including specific recommendations for improving their mobile apps. Seven digital challenger banks’ offerings were evaluated along the same criteria.
Banks should start today to take critical action in respect of their mobile app portfolio to prevent new competitors from gaining further inroads and meet fast-changing digital consumer needs. It is crucial to provide a seamless customer journey; tools that give clients the power to manage their finances and measures that make sure clients love to use the apps. The best mobile banking app is worth nothing if clients don’t want to use it due to inferior usability, lots of web-based content, slow and cumbersome navigation and non-optimized content copied from the bank’s websites.
Analyzed Banks: ABN AMRO, ANZ, Bank of Amercia, Barclays, BBVA, BMO, BNP Paribas, Caisse d'Epargne, Capital One, Chase, CIBC, Citibank, Commerzbank, Credit Suisse, Danske Bank, DBS Bank, Deutsche Bank, First National Bank, HSBC, ING, KBC, NAB, Nationwide, NatWest, PNC, RBC, Santander, Société Générale, Standard Chartered, TD Bank, U.S. Bank, UBS, UniCredit, Wells Fargo, Westpac.
Analysed digital challenger banks: Atom, Monzo by Mondo, N26, digibank! by DBS (India), Monese, Simple.
About the report: The report “Mobile Apps for Retail Banking 2016 – Tech-Savvy Clients Let Down by Shortcomings” analyzes the strengths and weaknesses of the mobile apps of 35 leading retail banks worldwide. In total 113 mobile apps and 27 Apple Watch apps were assessed according to 49 respectively 11 criteria and grouped into nine main categories of evaluation: availability of mobile apps; core functions for customers; innovative add-ons; security and privacy; content and features for marketing; contact options; technical features and support; strategy and navigation; and best practice.