'A tailored experience is absolutely key' in mobile banking: Fiserv

Nurdianah Md Nur

The banking space is also moving so fast - especially with payments, technology options, competitive launches, and retail expectations being created by Amazon and others - that it can be bewildering as to where to start. My advice to bankers is to pick a segment, work out what is important to that demographic, create a minimum viable product, launch and then be prepared to iterate relentlessly to add necessary capabilities. This is not a "once and done" for five years technology proposition, it requires constant development.

Are third party payment solutions posing a threat to mobile banking? If it is, how should banks steer their customers to use their own mobile banking apps instead of these alternative payment solutions?
I don't think third party payment solutions are a threat to mobile banking in its broadest sense. However, it is more a threat to certain specific sources of bank revenues.

I think we also need to understand that developments in the area of mobile payments are seismic and in their early stages. Not only banks, but also the big networks such as Visa, MasterCard and AMEX are impacted. The power is shifting to the customer and merchant to dictate the payment instruments they want to use and accept.

Banks need to find a way to exist in this new ecosystem, and this may mean providing their own payment options, as well as partnering with multiple organisations to allow payments to be directly "pushed" by the consumer from their account to the merchant in a secure way. Celent, a research and advisory firm, calls this concept "contextual payments" and I highly recommend their whitepaper Top Trends in Retail Payments: A year in review. A really thought provoking piece of research.

It is crucial for banks to be able to offer payment services, such as person-to-person (P2P) payments, themselves so that they are not left out when their customers begin to look for these capabilities. Furthermore, banks can generate more transaction-based revenue, attract new accounts and increase loyalty among existing customers. Consumers prefer to use their existing bank accounts for P2P payments as it provides them with an added sense of security when making financial transactions. P2P payments or mobile payments should be seen as a natural extension of existing mobile banking services. All of these new payment options create the need for secure transactions and protection of customer information. Banks can leverage their privileged trusted history with the customer and create local payment networks.

There were numerous news articles last year on how mobile devices are vulnerable to malware. How should banks assure their customers that their mobile apps are secure?
Unfortunately, the more popular a channel is to consumers, the more popular it is to criminals. In addition, the sheer growth of the channel and the speed of technological development can lead to potential risks.

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