Cyber-risks hinder mobile banking growth

The growth of mobile banking services is being strongly held back by security issues, as mobile users say they'd be using them more if they were more secure.

This is according to a new report by security researchers Kaspersky Lab and IDC Financial Insights, who polled 1,015 individuals (515 from the United States and 500 from the United Kingdom) on their attitude towards mobile banking.

Out of those that are not using mobile banking (36 per cent), a vast majority (74 per cent) said security is the main reason they're staying away.

But even those that are using the service, share the same fears. Out of both users and non-users, 85 per cent said they'd increase, 'to some extent', their mobile banking usage, if there was more security. Almost half (44 per cent) would increase their usage 'significantly'.

Banks and other financial insitutions would benefit greatly from a greater use of mobile banking services, primarily as that could mean an increase in revenue, and the reduction of transactional costs. That's why it is particularly alarming to find out that almost a third (32 per cent) said they can't see themselves using such services – ever.

“Consumers are concerned about security on their mobile devices, which has limited adoption of high margin mobile banking and payment activities including account opening, payments and transfers using a mobile phone,” says Marc DeCastro, research director IDC Financial Insights.

“As the next generation of online, mobile first and mobile only customers begin to explore digital banking choices, financial institutions that have and promote stronger security will attract and retain these customers more easily than those who do not.”