“More people are turning to the convenience of mobile devices for their financial service needs, fueled in part by the adoption of smartphones, 3G devices and unlimited data plans,” said Sarah Lenart, comScore vice president.

“The ubiquitous nature of mobile devices affords financial brands an important channel to reach and engage customers, whether it’s at home, work or on-the-go. As brands compete for customer loyalty in this competitive market, marketers will need to focus on continually improving the mobile customer experience and adjusting to the changing landscape and consumer needs as they access their financial information.”

Mobile browsers were accessed by 18.6 million users to view financial information in the fourth quarter of 2010 , up 58 percent from the previous year, 10.8 million accessed their accounts via applications, up 120 percent. SMS (text message) represented the smallest access point for financial service audiences with 8.1 million users, up 35 percent.

Among mobile banking and credit card users, nearly half prefer going online via a fixed device as the main way to access their accounts, with 47 percent of mobile banking customers and 44 percent of mobile credit card users doing so. Mobile has become an increasingly important access channel with 36 percent of mobile credit card users and 26 percent of mobile banking customers indicating it is their primary method of accessing their accounts. Only a small segment of these users listed speaking with a representative in person or on the phone as their preferred access method.

comScore also looked at the reasons people do not use mobile devices for financial activities. The results indicated that preference for using a fixed online device topped the list for both smartphone and non-smartphone users at 53 percent and 45 percent, respectively. Security concerns were also rated highly as a concern among both smartphone users (33 percent) and non-smartphone users (30 percent). Nearly a third (29%) percent of non-smartphone users said cost was a reson for not accessing accounts, while only 10 percent of smartphone users said the same thing (as unlimited data plans void this concern for many smartphone users).

More than a quarter (26%) of smartphone users also said that slow connections speeds limited their mobile financail service usage. Only 6 percent of smartphone users and 5 percent of non-smartphone users said not knowing about these services was the reason why they did not access these accounts.

The study looked at how mobile users access their banking accounts and found mobile Web browsing to be the most popular way for both smartphone (44.1%) and 3G users (53.3%), followed by mobile applications (48.1 % of 3G users and 40.6% of smartphone users.

The relative balance among usage of browsers vs. applications for access to mobile banking indicates the growing importance of ease of use for accessing accounts and conducting transactions. The percentage of mobile bankers who used texting for access to their account information was significantly higher among 3G users (41%) than Smartphone users (25%).

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"The increasing adoption of smartphones and access to 3G networks, along with the rapid development of mobile apps, have created a fertile environment for the acceleration of mobile banking," said Marc Trudeau, comScore senior director. "

"A seamless mobile banking user experience is necessary for this behavior to take hold, and the convergence of the aforementioned technologies is now making mobile phones a viable access point for personal banking transactions. Financial institutions hoping to capitalize on this quickly emerging consumer banking trend need to be ahead of the curve and understand how consumers are using the mobile channel today and how they would like to use it in the future."

The largest percent of mobile customers, 31 percent, access their financial accounts from home, even though many households have Internet connections available. Another 25 percent conduct transactions when running errands, while 15 percent do so during their commute. Nine percent of respondents indicated that they primarily access their accounts while on vacation, and 8 percent do so primarily while traveling for business.

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The survey of about 500 U.S. consumers found the majority (91%) had never tried banking on a mobile device. Of those respondents who have never done banking on a mobile device, 48 percent said security and privacy were the main reason.

"Consumers value banking services that make their lives simpler and more manageable and mobile banking affords this convenience, so banks that address concerns over security, privacy, and costs may be better able to retain existing customers and attract new ones," said Carl Carande, a principal in KPMG LLP’s Advisory and Banking and Finance practices.

More than half (68%) of respondents said their current bank does not offer banking on a mobile device and only nine percent said they had tried mobile banking.

"The fact that the majority of U.S. consumers are not aware that their current banks offer mobile banking is clearly more perception than reality," added Carande.

"Banks will need to work harder to increase customer awareness of the availability of mobile banking and clearly articulate the value proposition of the service before consumers are willing to pay for it."

The majority (66%) of U.S. consumers also are not comfortable using their mobile device for financial transactions.

When it comes to payments, 95 percent said they never made a purchase using a mobile device on a retailers mobile Web site, indicating a lack of comfort in using a mobile device for transactions and payments.

"U.S. consumers — as well as worldwide — need to be convinced that new payment methods and banking vehicles are safe and secure for them to succeed," said Mitch Siegel, director of payment advisory services in KPMG LLP’s Financial Services practice.

"With high mobile device penetration rates, U.S. consumers are accustomed to using the mobile channel to access data," said Siegel. "And it may only be a matter of time before they grow comfortable with using — and potentially paying a premium to use — the mobile device for browser-based and point-of-sale, ‘contactless’ financial transactions."
 

The study found that 16 percent of mobile phone subscribers currently use mobile banking services, with 60 percent doing so at least once a week. Thirty-five percent of those who do not use mobile banking or buy on-the-go are interested in checking bank account balances and transferring funds using their mobile devices. Thirty-three percent said they would like to receive text messages from their banks.

Around 25 percent of mobile phone users with mobile access to the Internet use their devices to purchase goods and services online using a credit card. Twenty percent favored using their phones like a "mobile wallet" someday, with charges billed to their mobile accounts. Ten percent said they would consider wire transfers and stock trading using their mobile phones.

"Today’s mobile devices are the springboard for a whole raft of services, with huge pent-up demand for mobile commerce capabilities," said Joseph Porus, vice president, Harris Interactive.

"If security concerns can be quelled, the sky’s the limit with consumer acceptance of mobile banking and purchase transactions. It’s a very intriguing prospect for the near future, considering how people have already embraced a variety of mobile technologies beyond simple phone communications."

Security concerns are the biggest obstacle affecting users acceptance of mobile banking and commerce. Sixty-six percent were worried about using their mobile phone to transmit sensitive financial information, while 63 percent were concerned about fraud and financial scams. Sixty-one percent worry about losing a mobile phone containing personal financial information.

"While the survey indicates people have concerns associated with using mobile devices for financial transactions, it’s similar to the evolution of the Internet as a viable tool for banking and buying," Porus said.

"We expect mobile technology to only improve and become even more secure in the coming years. This should ease people’s fears and make mobile commerce appealing in the future."

Mobile banking will be appealing to 18- to 25-year-olds, or Generation Y. They will be early adopters of mobile banking with 40 percent indicating that mobile services will be a factor in their choice of bank.

Celent projects that by 2010, about 70 percent of bank center call volume will come from mobile phones. Fifty-percent of those calls will be related to basic balance inquiry information. A customer service inquiry via mobile banking will cost less and be a reason for banks to embrace the new channel.

"The mobile banking end game will not be about checking balances and paying bills. It will evolve into a mobile wallet, allowing banks to generate greater electronic payment volume through the combination of electronic loyalty programs, mobile marketing, and contactless payments," says Dan Schatt, author of the report and senior analyst at Celent.

"While loyalty and marketing applications are still largely confined to product roadmaps, they will make their debut in late 2008, and by 2010 we will see the fusion of mobile banking and mobile contactless payments."
 

The report said that one-fourth of mobile bankers would be customer who had not tried mobile banking previously.

"With mobile device penetration in the US at an all-time high and market dynamics shifting, mobile banking is finally poised to thrive," said Bob Egan, chief analyst at TowerGroup.

"Consumers view their phones as trusted devices, even more so than their desktop PC," Mr. Egan said. "This perception will help fuel the adoption of mobile banking among non-online banking users."

The TowerGroup also estimated that up to 30 percent of online banking users would start using mobile banking in the next five years.

The site features characters that lead users through interactive demonstrations of each online and mobile banking product. Customers can find information on how to access accounts, pay bills, transfer funds, locate branches or ATMs and receive account alert text messages on their mobile phone.

Customers can also see how to gather information and accounts for a clearer financial picture, all with layers of security to keep customers personal finance information protected.

Users can stay up to date on their finances by viewing checking, savings and credit card statements through online banking along with receiving electronic versions of current and past statements.

"Our customers lead mobile lives and they need a bank with options, products and features that can keep up with that fast pace," said Lance Drummond, eCommerce/ATM executive at Bank of America. "With Bank of America, all you need is Internet access through your computer or mobile phone to be connected to your finances anytime, anywhere."