The Future of Mobile Banking
I’m really a patient guy. Everybody tells me so. But sometimes my patience is tested to the brink. Last week, I was standing in line at the grocery store. I was running a little late, but no problem. There was just one person ahead of me, and the cashier was scanning her last item. Then cashier said, “That will be $23.52.”
I guess that was a surprise to the customer because only at that point did she start to search her massively huge purse. After a while, she located her CHECKBOOK. I am also a really polite guy, so I kept the groan inside my head. You know the drill. We have all been through it. Another several minutes for filling out the check. Another few minutes locating the driver’s license, etc.
After she finished reloading her purse and chatting with the cashier about what a nice day it was, she moved on. I walked up, tapped my credit card for my purchases, grabbed my stuff and left.
I made it to lunch with friends a few minutes late, and I told them what happened at the store. My friend Joe brought up an interesting point. He said I had just witnessed history. That was a perspective I had not considered. Then Imelda said that in the future my “card tap-and-grab checkout” will probably be too slow and irritating to people when new mobile banking apps come out.
When it was time to pay the lunch bill, Tony asked if he could use his credit card to get some more airline points. We all said sure, took out our smart phones and zapped him our share of the bill.
As I drove home, I pondered the idea of future banking products. When I got home, I called an old boss who is currently Chief Innovation Officer at one of the largest banks in the country. I asked him what those new mobile banking apps may be and heard some fascinating new possibilities. Since this is a subject near and dear to his heart, I listened to an enthusiastic monologue on the future of banking. Let me summarize the key points.
Consumers are demanding self-service and immediate assistance when they need help. Product development is moving toward making banking easier and faster. This trend has been happening for a long time, and the pace is picking up.
There are some interesting concepts being developed such as card-less ATMs that use your fingerprint and a temporary pin sent to your smart phone. Voice and biometric authentication will become more widespread as credit and debit cards with passwords and pin numbers fade away. Digital wallets will make the leather wallet go the way of the plastic coin purse.
Blockchain, a term that is usually associated with bitcoin and cryptocurrency, may be one of the most influential technologies making mobile banking easier and faster. It is a digital ledger system that holds transactions securely and with maximum transparency. Remember when my lunch gang all transferred money to our credit-card-miles guy with our phones? We were using a peer to peer transfer. Only it wasn’t directly peer to peer because the transaction goes through a third-party company. Blockchain banking platforms will allow direct transfers.
The nice thing about these upcoming changes is very few will have any additional fees since banks have invested in the required hardware already. In fact, most of the new apps will generate cost savings to the banks without significant capital investments. That means the banks save money as they add these new services. However, as mobile banking gets easier and more convenient, your lizard brain might take over. That is the part of the brain that allows you to do anything you want in the spur of the moment. You will want to make sure that you are using your analytical brain to overcome the new painless ways to spend your money.
And finally, the most exciting new mobile banking innovation is called the MTP — the Mind Transfer Process. With this app you will have your smartphone nearby and wear a special ear bud. This ear bud works just the opposite of current ear buds. Instead of transferring sound from the smartphone to your ear, this ear bud picks up your thought process and transfers it to the smartphone. So, if you want to transfer money, you just think, “Bank, send $20 from checking to Tony,” and it’s done. Probably better not to use this app when in a bar.
Actually, I just made that last one up, but who knows?
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Written by Dave, an Accredited Financial Counselor® who has been helping families plan their finances for more than 30 years
