Mobile banking reached a threshold of acceptance in 2009 and has now become a service that consumers expect from their financial institution, according to a ClairMail executive.

Mobile Commerce Daily’s Dan Butcher interviewed Joe Salesky, founder, chairman and chief strategy officer of ClairMail, Novato, CA, to discuss his forecast for the mobile banking space in 2010. Here is what he had to say:

What is your outlook for the mobile banking, commerce and payments space in 2010?
Mobile banking reached a threshold of acceptance in 2009 and has now become a service that consumers expect from their financial institution.

The growth of mobile banking will continue to accelerate in 2010 as both banks and customers increasingly rely on it to proactively alert customers regarding transaction activity, enhance security and improve the ease and efficiency of account management.

We estimate that 50 percent of banks will select platforms and begin deploying mobile banking within the next year.
 
The greatest change we see for mobile banking in 2010 is its increasing strategic importance within the financial institutions. Banks are now realizing that mobile banking has the potential to reach 100 percent customer adoption and plays a central role in increasing customer retention and bank profitability.

To achieve this, banks must enroll customers at all points of customer interaction and help them adopt and manage new capabilities on a platform that integrates all modes of communication – voice, data and messaging –  into a seamless, converged and easy-to-use interface for the customer.

This convergence makes it necessary for banks to not only pick a mobile banking platform, but make sure the solution they choose has the essential capabilities required to improve the orchestration of interactions across bank channels necessary to converge the customer experience and deepen the relationship with the customer.
 
Integrated payments capabilities for both person-to-person and international remittance will also begin to emerge and take hold in 2010, as well as new technologies facilitate mobile payments such as Near Field Communications. 

What challenges do you expect and what opportunities? Trends?
Security is both a challenge and an opportunity for banks in regards to mobile banking and its adoption.

Banks will need to continue to educate the consumer on the critical role that mobile plays in improving their security while, at the same time, allaying perceived security concerns that may slow mobile banking adoption.

The mobile channel offers a tremendous opportunity to increase the customer detection of fraudulent transactions with real-time actionable alerts. Today 51 percent of fraudulent transactions are detected by the consumer.

Real-time transaction alerts have an unmatched potential to improve customer awareness of card-not-present and other at-risk transactions that allow the customer to respond directly to those that are questionable.
 
Mobile banking also presents an opportunity for banks to expand and deepen relationships with its customers, thereby increasing customer retention and profitability. Bank customers vary in their level of commitment to the institution, typically related to the number of products or services they use.

Most customers start out with one or two bank products and then deepen their relationship over time.

Nearly 65 percent of bank customers are under-committed with fewer than three products. These customers are the most difficult to retain and offer the greatest potential for the bank.

The challenge for banks is that there are limited opportunities to communicate with the under-committed customers other than statements and mass media.

Given that all bank customers, from the single credit card user to the five product customer, value proactive transaction alerts, mobile provides the most significant opportunity to expand the frequency of valued communication with the customer which improves servicing efficiency and converts increased product awareness into deeper, more committed customer relationships.             
 
What is your advice to marketers, advertisers, content providers, banks and retailers?
Universal enrollment and proactivity are essential. Some in the industry have approached mobile banking as an offshoot of online banking, assuming that mobile banking users will enroll for service via online.

Only 35 percent of bank customers currently use online banking, and the greatest ROI from mobile is generated by attracting customers that do not use an efficient electronic channel. Approaching mobile banking enrollment in this fashion or treating it as a veneer on top of online banking functionality is a recipe for turning a gold mine into a silver mine.
 
The mobile device offers an unprecedented opportunity to provide proactive bank interactions, convenient information and account management to all bank customers.

Only by offering mobile banking enrollment through all customer interaction channels – whether it be via the mobile phone, the bank branch, online, or via the call center – will banks achieve the greatest ROI.
 
While enrollment is critical to success, confusing or non-personalized generic service delivery will drive down utilization and consumer perception of both value and quality.

Financial institutions must be driven by a desire to simplify the customer experience by bringing together all mobile banking channels – Web, messaging, smart client applications and voice – into the most cohesive and compelling experience possible on the customers’ mobile device.

This requires a platform that can help orchestrate tasks across channels inside the bank and converge and optimize the experience at the handset. Smart client applications without integrated, actionable alerts or Web experiences that ignore the difference between a touch interface and a roller-ball are perceived as poor quality by customers and do a disservice to the bank brand.

The mobile phone is the most personal piece of technology used by the consumer, and exceptional service has the opportunity to drive a valued one-to-one conversation with the customer.