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Prospects for the Development of Mobile Banking

Mobile banking, or mobile banking services, has been rapidly gaining popularity in recent years.

Posted: 1st February 2024 by Finance Monthly
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It represents access to bank accounts and various financial transactions through smartphones and tablets. 

The advantages of mobile banking are apparent - it is convenience, speed, and availability of financial services anytime and anywhere. Therefore, experts predict further rapid growth of this segment of financial technologies and active development of its functionality. Let's take a closer look at the main trends and prospects of mobile banking.

Advantages of mobile banking

Mobile banking has several significant advantages over traditional banking. These advantages explain the current trends in mobile banking and its growing popularity.

Accessibility and convenience

The main advantage of mobile banking is the ability to make financial transactions 24/7 without visiting a bank office. It is enough to have a smartphone and the Internet. Mobile banking applications are very convenient to use.

Quick and easy operations

In mobile banking, you can make payments, transfers, purchases, and other operations much faster. There is no need to fill out receipts or stand in queues - everything is done in a few clicks.

Increased security

Mobile banking is constantly improving security measures. New systems of user authentication and data encryption are being developed. The leakage of confidential data is becoming less and less likely.

Financial analytics and convenient planning

Mobile applications offer convenient analytical tools - income and expense charts, reports, and financial planners. It makes it easier to control personal finances and budget.

Introduction of additional services

In addition to standard operations, new valuable functions appear in mobile banking applications. For example, services for selecting deposits, investments, and loan offers from different banks for a favourable choice.

Disadvantages and risks

Despite the numerous advantages, mobile banking has several disadvantages and is associated with certain risks.

Cybersecurity risks

The main danger is cybersecurity risks. Fraudsters regularly attack banks' mobile apps to steal money from users' accounts and obtain personal data. Social engineering and malware are also a threat.

Operational risks

Sometimes, erroneous, double, or unauthorized payments occur due to app malfunctions or user errors. This results in financial losses to customers.

Insufficient functionality

Some mobile banking apps still need more functionality than web-based online banking versions. For example, there is no option to make deposits, loans, or investment products.

Technical limitations

There are risks of mobile banking not working correctly due to poor internet connection or lack of space or capacity on the user's smartphone. It can hinder essential transactions.

Thus, banks should continuously improve mobile banking security systems and enhance application reliability to minimize the risks. And customers should take precautions and use digital services wisely.

Development prospects

Despite shortcomings, mobile banking has tremendous prospects for further development based on innovative technologies.

Introduction of artificial intelligence technologies

Implementing artificial intelligence (AI) and machine learning technologies will improve mobile banking, making it more intuitive and convenient.

Based on neural networks and deep learning, context-aware, self-learning systems will be created to automate many routine operations. It will allow banks to optimize business processes and reduce costs while maintaining high quality of service.

AI can analyze customer behaviour and preferences in real time to create personalized offers on deposits, loans, and investment products for a particular user, considering their financial profile. It will increase customer loyalty.

Voice Assistants

Voice financial management via Siri and other virtual assistants using speech recognition and synthesis technologies opens up a new convenient channel of interaction with the mobile bank.

Users can make payments, transfers, and purchases by voice commands. It is especially relevant for motorists, who will manage their account while driving without distracting from the road.

Voice control is also promising for people with disabilities who find it difficult to use touch screens or gadgets. For example, people who are blind or people with musculoskeletal problems.

Blockchain and cryptocurrencies

Blockchain technology opens up new prospects for mobile banking in payments, remittances, and lending by increasing transparency, security, and speed of transactions. Some banks are already developing blockchain-based applications.

More integration of services with cryptocurrencies and tokenizing banking assets through smart contracts is expected. It will facilitate cross-border transfers and payments and reduce costs compared to fiat money.

Security and regulation

One of the most critical trends in the development of mobile banking is increasing cybersecurity and regulation of this sphere by the government. Here are the main trends in this area:

  • Increasing the security standards of mobile banking applications. It concerns the development of more advanced data encryption methods, two-factor authentication of users, and protection against malware and fraud. 
  • Introduction of biometric systems. Using facial, fingerprint, and voice recognition when logging into a mobile banking application. It is a more reliable method of identifying the owner than passwords.
  • Development of artificial intelligence technologies to identify suspicious transactions and prevent fraud in real-time based on analyzing behaviour patterns.
  • Tightening state regulation of mobile banking to increase the responsibility of financial organizations for the safety of funds and confidentiality of user data. Introduction of more severe fines for violations in this area.
  • All mobile payments and banking services market participants must adopt industry information security standards.

Thus, implementing these measures will significantly improve the reliability and security of mobile banking, which will serve as an additional factor in its popularization among the general public.

Conclusion

Mobile banking is rapidly gaining popularity due to convenience, accessibility, and development of new technologies. The introduction of AI, blockchain, and other innovations will increase the functionality of mobile banking but require increased attention to cybersecurity. The development of mobile finance will continue to grow if this sphere is regulated to minimize risks.

About Finance Monthly

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Finance Monthly is a comprehensive website tailored for individuals seeking insights into the world of consumer finance and money management. It offers news, commentary, and in-depth analysis on topics crucial to personal financial management and decision-making. Whether you're interested in budgeting, investing, or understanding market trends, Finance Monthly provides valuable information to help you navigate the financial aspects of everyday life.
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