Mobile Banking Trends: Find Out What is Hot and How to Stay Protected

We’ve all seen the TV commercial where the attractive couple is in bed, taking a picture of their check with a smartphone to make a mobile deposit.

The not-so-subtle subtext of the ad equates mobile banking with a sexy, idyllic lifestyle. Is it all hype, or is it as hot as the banks would like us to believe?

2011 was a watershed year for mobile banking trends, and it’s safe to say that the trendsetters among us are ready to make it serious. Banking transactions via smartphone led the way with such services as:

  • Mobile payments and transfers

  • Context-aware capability such as locating the nearest ATM

  • Mobile remote check deposit

  • Access to balances/account activity

  • Payment due reminders

Mobile - it has that special something

While early-technology adopters have been seriously flirting with transaction-based mobile banking, there are many mobile-inspired paradigmatic shifts underway:

  • Overall mobile growth is 10% a year and is rapidly overtaking the Web for online banking.

  • The global mobile banking industry will grow to 1.1 billion customers by 2015.

  • App stores are the new delivery model for just about everything (except for babies) and 75 percent of American banks have developed free mobile banking apps for their customers.

  • Tablets are coming out of the woodwork. It’s estimated that 39 percent of new tablet users will use them for banking.

Banking is getting social, too. Financial institutions are using social media to handle customer service issues, pump up their brand loyalty and build relationships. Twitter is the channel of choice for banks like Wachovia and Bank of America; the platform suits the immediacy of customer care issues and feedback. Citibank members can use the micro-blogging site to make transactions (although, many people question the privacy of this method and are unsettled by the thought of their financial info being displayed for the world to see).

You’re ready to jump into bed, but are you protected?

Before getting hot and heavy with mobile banking, you need to ask yourself, "What about security?" Sure, you find its handiness irresistible, but mobile banking safety trumps convenience every time when you consider the implications of opening your financial data to hackers.

By employing common sense and taking a few precautions, you can make banking-on-the-go a safer, viable choice. Here are several protective measures, not just for mobile banking but for smartphone security in general:

  • Never use public Wi-Fi when banking via your mobile device; opt for the 3G or 4G connectivity of your own smartphone. (Although those algorithms can be hacked, any respectable mobile commerce site will have SSL encryption in place for further protection.)

  • Only download a banking app through your bank’s Website to be sure it is legitimate.

  • Don’t open phishing emails that mimic your bank’s look and feel. Be familiar with your own bank’s Website so you can discern a fake. Typos and wonky design choices are dead giveaways.

  • Don’t click on links in a suspicious email, type your bank’s URL in a browser and login from there.

  • Though SMS (text messaging) is the easiest way for banks and customers to communicate, this channel is relatively unsecure and should not be used for money transfers or logging in.

  • Install mobile anti-virus software which will protect against malware and lock or wipe your device in the event it is misplaced or stolen.

Making a commitment

The security precautions for smartphone and tablet banking are the same as those for your PC. Smartphones are not inherently more risky, except for one important thing: It’s a heck of a lot easier to lose a phone than a computer.

The likeliest way for a hacker to access your bank account information is if they have your phone in their hands. To guard against this, always maintain a password protected system, and if you have to, use security software to wipe the phone clean so valuable data can’t be stolen.

If your phone happens to fall into the hands of a hacker who manages to drain your bank account, it’s not necessarily an unmitigated disaster. Most banks have a zero-liability guarantee that protects you from unauthorized charges. Check with your bank to make sure they offer this service for smartphone banking.

Mobile banking will likely become the preferred choice for consumers. Trends will push to make it the easiest and most cost-effective way to take care of your finances. Just make sure to do your due diligence before getting involved with this new banking method.

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