Posts by Ed Kountz from May 15, 2008

Ed Kountz | May 15, 2008, 09:07 AM
BofA's M-Banking Advances - Wrapup from CTST

Bank of America's Q1 2008 earnings press release included a reference-worthy data point on mobile banking. as one of its first quarter 2008 business accomplishments, the firm noted that "Mobile Banking recorded approximately 224,000 activations reaching 840,000 active customers."

link

Clearly, mobile banking is still in its early days. But BofA's mobile growth--and, in contrast to mobile banking 1.0, willingness to report numbers--are an important market indicator. An upcoming JR report on mobile payments notes that just 16% of U.S. mobile users regularly use their phone's browser to access mobile data, indicating that, while mobile browsing remains sparse in the U.S., those who do find value in m-banking services. As these numbers expand, firms like Monitise Americas, Firethorn Mobile, Clairmail, and mFoundry stand ready to assist.

Translating this growth into success with mobile proximity payments will remain elusive in the U.S., however. CTST 2008 included a variety of views on the topics of mobile banking and payments. As previously noted, m-proximity remains thorny in the U.S., both due to the lack of NFC handsets and the need for resolution, with positive business benefits for all parties, of the surrounding business model issues.

link

So the potential of m-banking looks positive, in an early-stage sort of way (and given the need to toggle between SMS, browser-based and downloadable apps), and it increasingly appears that m-banking will serve as the back door into handset-based transactions in the U.S. But given the handset and business model issues that remain, translating excitement into services that resonate with the consumer will still take several years. In the interim, FIs, retailers and mobile operators should focus on interim steps ... gathering consumer opt-in permission for marketing and offers, as a foundation for emerging transactional demand.