Nick Wilde, managing director of Fiserv Asia
Banks today should leverage the rapid proliferation of smartphones by rolling out or improving their mobile banking services or be at risk of losing part of their revenue to competitors. Nick Wilde, managing director of Fiserv Asia, talks about the current state of mobile banking in Asia, the possible factors hindering banks from entering the mobile banking space, and shares tips on how banks should secure their mobile apps.
What is the state of mobile banking in Asia today?
As a headline, I think the reality is starting to catch up to the hype. In fact, the move towards digital banking is happening much faster and more pervasively in Asia than in other geographies. This is due to a number of factors coming together to accelerate and emphasise the importance of mobile technology in banking. These factors include the availability of the "cheap" smartphones, the increasing ubiquity of wireless connectivity, demographics (skewed to young, digital savvy), growth of middle class and sparse infrastructure in non-urban regions. The combination of all these factors is a solid tailwind for the greatly enhanced deployment of this not-so-new solution.
In developed economies such as Singapore or Australia, there is already a mass adoption of smartphones. Hence consumers have been using mobile banking for a while. However, there is a growing realisation that mobile is not just another complementary service channel but a game changer which paves the way to develop new forms of relationships through interactivity, self-service, direct communication (such as instant messaging, alerts and Skype), and personalised offers and services.
On the other hand, digital channels open the door for non-traditional competitors to enter the market, disintermediate the financial institution and thereby siphon off customers and payments. Payments can contribute to about 25 percent of banks' revenues and is an area that is heavily under attack from non-traditional competitors, such as Paypal. The industry as a whole is also closely watching Apple and Google on whether they intend to enter the world of payments in a serious way.
In many areas of Asia, banks are forced to look to mobile not just as a complement to the traditional bricks and mortar but as the principal distribution channel for financial services. This recognition that the digital channel is the primary mode of customer contact then demands radical changes in the thinking about technology, risk as well as product and the need for a support ecosystem (agents and merchants).
It is my belief that Asia is not just keeping up with the more mature economies of USA and Europe but is also demonstrating leadership, often through necessity.