Javelin’s fifth annual “2012 Mobile Banking Financial Institution Scorecard: Three Keys to Mobile Money Movement Success” report looks at how the top financial institutions are using mobile apps, SMS and mobile Web to help clients manage their finances. The study surveyed 24 banking services from the the top 25 financial institutions in the United States.

“Those who rose to the top of the list started by providing wide access for their customers by offering mobile banking through SMS text, mobile Web and downloadable app,” said Mary Monahan, executive vice president and research director for mobile at Javelin Research and Strategy, Pleasanton, CA.

“They must provide coverage for all the major smartphones and tablets — Android, Apple, Windows and BlackBerry,” she said. “Those are the basics.

“But to go to the top of the list, they must go above and beyond the basics, by providing cutting edge services, such as mobile deposit, mobile person-to-person, near-real-time alerts, actionable alerts and mobile banking for businesses.”

Best in class
Chase was singled out by Javelin for the second year in a row.

In particular, it is Chase’s advanced features that stand out in its comprehensive mobile strategy.

For instance, Chase offers real-time alerts, mobile deposit and person-to-person transfers.

Bank of America placed second in the report. Bank of America’s wide mobile accessibility by device and mode is what grabbed Javelin’s attention.

Bank of America offers 81 percent of the features that Javelin scored companies on.

Capitol One, USAA and Wells Fargo scored the same and round out the top five banks surveyed.

Five financial institutions — Sovereign, TD Bank, BMO Harris, Comerica and HSBC — do not include mobile alerts or notifications into their strategies.

When it comes to types of mobile alerts that financial institutions are using, 80 percent use text message alerts. Seventy-two percent of banks surveyed offer a text banking option.

Sixteen percent of financial institutions surveyed used push notifications.

“Services that truly hit at the core capabilities of mobile phones are those that create the biggest demand,” Ms. Monahan said.

“A customer can now snap a picture of a check that they want to deposit using the camera function of their smartphone and instantly send it to their bank using a mobile banking app,” she said. “If you look in the app stores, you will see many complaints by customers whose banks are not yet offering this service. Customers really love the convenience.

“Mobile financial services are just paving the way toward mobile shopping. Last year, consumer spent over $20 billion using their mobile phones in the U.S., and that number is only going to rise.”

Banking demographics
Roughly 39 percent of smartphone and 50 percent of tablet bankers claimed to be early adopters of mobile, compared to 17 percent of all consumers.

Generation Y in particular is a sweet spot for banks and payment companies.

Twenty-one percent of mobile bankers inside the Gen-Y demographic identified themselves as early adopters.

Additionally, 84 percent of Gen-Y users surveyed said that they had sent text messages in the past week, and 48 percent said that they had checked into a social media site on their mobile device in the past seven days. This points to how plugged-in younger consumers are.

Seventy-six percent of mobile bankers are aged between 18 — 44 years old.

Women skew slightly higher than men as mobile bankers, representing 53 percent of mobile bankers.

Additionally, approximately 52 percent of mobile bankers are caucasian, 24 percent are latino, 11 percent are African-American and nine percent are Asian, according to Javelin’s findings.

Similarly, consumer income plays a big role in how financial institutions should be targeting consumers.

Forty-three percent of mobile bankers reported an annual income of $75,000 or more. Twenty-one percent of users fit into the $50,000 – $75,000 annual income bracket.

One area of improvement for banks is with mobile enrollment. Eight percent of the financial institutions surveyed by Javelin allowed for mobile Web and app banking to be completed over a handset.

Furthermore, only one bank — ING, which is now part of Capitol One — allowed for users to set up a new account via mobile.

When it comes to SMS banking, only three companies surveyed offered mobile enrollment — Wells Fargo, U.S. Bank and Bank of America.

Mobile banking
According to Javelin, banking and financial services are now used by 33 percent of mobile users, which is an increase from 24 percent in 2009.

Twenty percent in mobile consumers in 2010 used their mobile banking. Twenty-nine percent of mobile users in 2011 said the same.

These numbers represent mobile banking used in the past year.

With this increase, banks and financial institutions are getting savvier with their mobile features.

For example, Javelin found that of the top 25 financial institutions in the United States, roughly half offer either remote deposit or person-to-person mobile services. The finding more than doubled in 2012 versus 2011.

App banking has steadily been growing in the past three years while mobile Web banking has dropped, per the report.

Additionally, more than two-thirds of financial institutions surveyed said that they offered mobile banking through applications, optimized Web sites and SMS.

Sixty-eight percent of financial institutions offer business mobile banking.

However, the introduction of more mobile features by financial institutions has also increased the number of problems to account access from consumers.

In 2009, four percent of mobile banking consumers cited access as their reason to not use their handsets to help manage their money. In 2010, seven percent of consumers said the same.

In 2011, 12 percent of consumers said that access to their account was a reason to not use mobile banking. In 2012, the number hit 14 percent of mobile banking users.

“The biggest issue is how to find an ROI for providing secure, convenient mobile banking services for the extremely wide variety of devices and operating systems that their customers want to use,” Ms. Monahan said.

“We see that each year more consumers are saying that ‘My bank provides mobile banking, but I can’t access it,’” she said.

“The demand is there, but not a way to satisfy it yet.”

Final Take
Lauren Johnson is associate reporter on Mobile Commerce Daily, New York