Mobile banking is the act of making financial transactions on a mobile device (cell phone, tablet, etc.). This activity can be as simple as a bank sending fraud or usage activity to a client’s cell phone or as complex as a client paying bills or sending money abroad. Advantages to mobile banking include the ability to bank anywhere and at any time. Disadvantages include security concerns and a limited range of capabilities when compared to banking in person or on a computer.
Mobile banking is a service provided by a bank or other financial institution that allows its customers to conduct financial transactions remotely using a mobile device such as a smartphone or tablet. Unlike the related internet banking it uses software, usually called an app, provided by the financial institution for the purpose. Mobile banking is usually available on a 24-hour basis. Some financial institutions have restrictions on which accounts may be accessed through mobile banking, as well as a limit on the amount that can be transacted. Mobile banking is dependent on the availability of an internet or data connection to the mobile device.
Transactions through mobile banking depend on the features of the mobile banking app provided and typically includes obtaining account balances and lists of latest transactions, electronic bill payments, remote check deposits, P2P payments, and funds transfers between a customer’s or another’s accounts. Some apps also enable copies of statements to be downloaded and sometimes printed at the customer’s premises. Using a mobile banking app increases ease of use, speed, flexibility and also improves security because it integrates with the user built-in mobile device security mechanisms.
From the bank’s point of view, mobile banking reduces the cost of handling transactions by reducing the need for customers to visit a bank branch for non-cash withdrawal and deposit transactions. Mobile banking does not handle transactions involving cash, and a customer needs to visit an ATM or bank branch for cash withdrawals or deposits. Many apps now have a remote deposit option; using the device’s camera to digitally transmit cheques to their financial institution.
Mobile banking differs from mobile payments, which involves the use of a mobile device to pay for goods or services either at the point of sale or remotely, analogously to the use of a debit or credit card to affect an EFTPOS payment.
Steps financial advisors can take to protect their clients against cyber-attacks include:
- Helping educate clients about the importance of strong, unique passwords (e.g, not reusing the same one for every password-protected site), along with how a password manager like Valt or LastPass can add an extra layer of security.
- Never accessing client data from a public location, and being sure the connection is always private and secure.
Types of Mobile Banking Services
- Account information access
Account information access allows clients to view their account balances and statements by requesting a mini account statement, review transactional and account history, keep track of their term deposits, review and view loan or card statements, access investment statements (equity or mutual funds), and for some institutions, management of insurance policies.
Transactional services enable clients to transfer funds to accounts at the same institution or other institutions, perform self-account transfers, pay third parties (such as bill payments), and make purchases in collaboration with other applications or prepaid service providers.
Investment management services enable clients to manage their portfolios or get a real-time view of their investment portfolios (term-deposits, etc.)
- Support services
Support services enable clients to check on the status of their requests for loan or credit facilities, follow up on their card requests, and locate ATMs.
- Content and news
Content services provide news related to finance and the latest offers by the bank or institution.
- Account Balance Enquiry
- Account Statement Enquiries.
- Cheque Status Enquiry.
- Cheque Book Requests.
- Fund Transfer between Accounts.
- Credit/Debit Alerts.
- Minimum Balance Alerts.
- Bill Payment Alerts.
- Bill Payment.
- Recent Transaction History Requests.
- Information Requests like Interest Rates/Exchange Rates.