The lead author of the ING International Surveys, ING senior economist Ian Bright, talks through some of the highlights of a major, new survey of 12,000 people on mobile banking and social media; A very revealing and quite enlightening piece that's worth sharing (and "Twitting" and "Facebooking").
What makes this ING International Survey worth looking at?
Several times a year, we research how people spend, save and feel about money. We routinely look at the topics of savings and homes and the latest is a special topic on mobile banking and social media. The surveys are a collaboration between ING's group research (based in the bank's economics department), customer intelligence and retail banking units in 12 countries, a partnership that brings together expert skills and local knowledge to create a really insightful mix. Mobile banking and social media was a departure from our usual topics. The team put in a lot of hard work to devise a thought-provoking survey – and was rewarded with some fascinating results.
What findings surprised you the most?
There are a lot of interesting results but if I had to pick the most surprising for mobile banking, it is that half of the people we surveyed who use mobile banking actually use it while they are at home. This seems counter intuitive in many ways because the thing about mobile is that you can do it anywhere. It makes more sense if the speed of mobile banking is a factor driving use in the home – perhaps it is quicker to log in using a mobile app than power up a home PC and use traditional online banking. On the positive side, two-thirds reported feeling more in control of their money and 84 per cent were checking their balance more often, so mobile banking appears to be changing some of the behaviour around managing money for the better. Our respondents who do not use mobile banking are most likely to say they don't know where they would use it or how (if they would check balances, move money or do something else). My reading is that mobile banking is not really on their radar. They haven't thought about it. Not surprising, I guess, but maybe they are missing a trick.
Where are the future mobile banking hotspots?
The Netherlands is the most developed mobile banking market of the 12 countries we surveyed. This measure is created by multiplying the number saying they use mobile banking with internet penetration – a step we took because the survey itself was internet-based. Turkey is our pick for the future hotspot for mobile banking. It has the greatest share of internet users who also use mobile banking. It shows great potential for growth as internet access becomes more widespread. Spain and Poland also showed large potential for future mobile banking growth.
Are there any differences in the types of people who use mobile banking?
We found that more men use mobile banking than women. And it was most popular among slightly older age group – the 25-to-34s and stretching up to people in their mid-40s. It might be because the technology needed, smartphones or tablet computers, tends to be quite expensive. If we do this survey again, we will be looking in particular to see if there is growth in the older demographic, people aged 55 years and above, because that would be an interesting indicator.
What other interesting issues came up?
The reasons people gave for not using mobile banking were very interesting. Number one was not having the technology required (a smartphone or tablet computer). However, distrust of the security of mobile banking was top in five countries in the survey – Germany, Austria, Luxembourg, the United Kingdom and Spain. The affordability of mobile devices might not be such an issue in these places but perhaps there needs to be more education about how mobile banking works and the security measures in place. Also, we see that people with low social media use also seem to be less keen to use mobile banking. It might be that it just doesn't suit their sensibilities in the tech sphere right now.
And what about findings about social media and banks?
We devised a series of questions to try to work out if social media was being used to inform decisions. The decisions ranged from less important choices around where to go for dinner, though to bigger ones, such which whiteware or car to buy. Financial decisions about whether to open a bank account or get a mortgage were included as well. We found traditional word of mouth – recommendations from family and friends – is still a major influence, bigger than social media. However, social media is playing a role: a quarter of our 12,000 respondents say they would often or sometimes use it when deciding to open a new bank account and a similar proportion if they were deciding whether to switch banks. Of people in Europe who use social media platforms to seek advice on financial matters, blogs were the most popular option followed by forums.
What do people expect to hear from banks on social media?
There is a great demand for banks to give tips for saving via social media. In total, 70 per cent agreed they expected this from their bank. This was much more than the number who expected banks to make it possible to do payments on social media or offer products and services on social media. It reinforces the message that social media is not simply an extension of advertising space and suggests people want relevant information and a two-way, interactive exchange.
Making payments by social media is a hot topic. What did you discover?
A third of the 12,000 respondents agreed they expected banks to make it possible to do payments though social media. Digging into the data a little further, some interesting demographic splits become apparent. Demand is much higher among heavy social media users and for people age under 35. These group are often seen to indicate future trends. It suggests demand is set to grow in the future. There are already financial institutions with a "social" backbone emerging in Turkey and elsewhere. Looking at the breakdown of responses by country on this question, Romanians and Turks were the most eager to make payments by social media – with more than half of the respondents in Romania and Turkey expecting banks to make it possible. The Dutch and the French were at the other end of the spectrum, with less than 20 per cent in the Netherlands and in France agreeing.
Is it out with the old and in with the new?
My favourite part of the survey, from my slightly nerdy point-of-view, was about the way different payment methods can influence emotions we feel about spending. We found 50 per cent preferred to use cash when shopping because it was easier to see if they were spending too much. When you think about it, using cash is a very traditional method and these survey results indicate there is still a lot of love out there for printed currency. Under 25s were actually more likely to have this point of view than some of the older age groups. Our "Millennials" want to mix the old with the new. They want to be able to make payments by social media and also see the appeal of tangible cash. It's about getting the best of both worlds.
You also asked about contactless payments. Do people trust them?
Contactless payments allow people to pay by waving their money card (or other device) over a reader at the point of sale – removing the need to enter a pin or sign and speeding up transactions. Several measures are in place to make payments secure. However, our survey found that the security of contactless payments is a concern to many, with 45 per cent disagreeing they would feel confident their money is secure if they used contactless payments. I like to think of contactless as the latest step in a long evolution of money. We moved from a world of mainly cash payments to one of ATMs and debit cards. Now we have apps, online and mobile banking. And contactless payments. It pays to remember though that as our use of money has evolved, so too have the ways we protect it.