Young European Social Media Users Pick Up Mobile Banking

By Chanel Smith, EMEA Editor (@PYMNTS_EMEA)

Banking transactions that once required us to make a trip to a brick and motor branch is now accessible with a few taps of the finger.

Mobile banking allows customers to access bank account details and make transactions on the go. Popularity is picking up across Europe with a third (37 percent) of consumers already logging into online banking accounts via mobile device. However, a new survey by ING International predicts that younger consumers will soon dominate the market as more banks allow transactions through social media applications. The study surveyed over 12,000 European consumers across 12 EU countries that use mobile banking, and revealed which countries are home to consumers who use mobile banking the most.

Mobile Banking In Europe

ING defines mobile banking as using any mobile device, such as a smartphone or tablet, to manage finances. At present, there about one-third of Europeans claim to have used mobile banking services. The study was taken in May 2013, and indicates that Turkey is the leading country in Europe with the highest percentage of Internet users who use mobile banking (49 percent). Spain and the Netherlands tied for second (each with roughly 44 percent), followed by Poland and Luxembourg, who also reported equal figures (each 41 percent).

Consumer Profiles

 The consumers who are most frequently engaging with mobile banking services are Internet users aged 25-34, ING’s study reported. Fifty percent of users in this age group said they use mobile banking apps, compared to the average 37 percent across all respondents. Moreover, the study showed that the most frequent social media users are also the consumers who are most likely to use mobile devices for financial services. On average, 33 percent of participants said they agree that they “expect banks to make it possible to do payments through social media” in the future. Consumers in Italy and Spain were the most enthusiastic, as 40 percent (Italy) and 42 percent (Spain) of respondents in said countries agreed with this statement.

Mobile Motivation

ING reports that consumers enjoy mobile banking because they feel it allows them to be more conscious of spending. For example, shoppers can access banking account information while at shopping centers. Seventy-five percent of British consumers said they use mobile banking because they think it gives them better control over their money. Across all European consumers, 73 percent said they same. Eighty-four percent said mobile banking causes them to check their account details more often, 62 percent said it helps them pay bills on time more often, and 55 percent said that thanks to mobile banking, they no longer overdraw from their accounts as often.

“People who use mobile banking feel more in control of their money,” said Ian Bright, ING senior economist. “Most of them say they pay their bills on time more often and are overdrawn less often. This is perhaps because 84 percent of mobile bankers check their balances more regularly since using mobile banking.”

Many Europeans admitted to finding mobile banking useful as it helps with monitoring spending. Yet, despite digital technology, cash is still the most popular method that consumers use to help with spending control. Fifty percent of respondents told ING they prefer cash when they shop because having tangible money they can see helps them know their limits. Spaniards are particularly fond of using cash whilst shopping (61 percent) – a number that jumped to 64 percent of for Spanish consumers ages 25-and-under.

The Future Merging Of Social Media And Mobile Banking

ING further questioned young social media users who mobile bank and asked what they expect to see in the future of mobile banking on social media websites. The most popular response (with 70 percent who agreed) was the service of banking management tips and advice. Secondly, with 61 percent, consumers expect that banks will use social networks to communicate corporate social responsibility (CSR) activity. However, responses varied drastically between various countries. For example 79 percent of Turkish consumers believe CSR will be strongly used in social media, while only 34 percent of French respondents said the same.

Fifty-six percent believe banks will release information on “how the economy affects me” for consumers, which they expect will be the third biggest option. Interestingly, few Europeans said they expect payments via social media accounts to become popular, as the study shows only 40 percent of those aged under 34 said this would become a popular option.

Europeans across the region are warming up to mobile banking and are aware of the advantages it offers in terms of convenience and money control. Cash still remains the preferred method for keeping track of shopping budgets, but as popularity continues to rise amongst younger social media users, mobile banking has an opportunity to offer other unique services that can improve customer value.

To read the full report at ING click here.