Mobile Payments

Bank of America CEO Talks Mobile Payments

While it’s well-known that mobile banking is on the rise, it’s not until quarterly earnings figures come out that the industry really gets to gauge just how much it’s growing.

And this week, for three big banks, the financial world got a taste of just how much that side of banking is growing.

For JPMorgan Chase, which reported on Wednesday (April 13), its mobile banking figures grew 19 percent from the year prior — up to nearly 24 million active mobile customers.

Bank of America saw similar growth on its mobile side and reported that its mobile banking figures grew 15 percent from the year prior — up to 19.6 million active users. For Wells Fargo, which reported along with Bank of America yesterday (April 14), it saw a 6 percent growth YOY on its digital banking side — up to 27.2 million. As for mobile, its growth was in the double digits — up to 17.7 million mobile active customers.

For BoA, CFO Paul Donofrio shared a bit of insight into the company’s branch cuts and its plans to consolidate its larger branches into more efficient ones that act more as customer service centers, which seems to be the growing trend among bigger banks.

“I think the branches are not going to be places where people come to transact. They’re going to come for a product they need because something changed in their life,” he said during a call with analysts.

BoA CEO Brian Moynihan also spoke about the bank’s plans to invest in its technology side — including putting $3 billion into technology-related growth initiatives, particularly digital.

“Focusing on Mobile Banking users … we added 910,000 net new mobile users this quarter. We now have nearly 20 million active users, and deposit transactions from mobile devices now represents 16 percent of deposit transactions … The online mobile part of the spend is now up to 20 percent of the spend, and it’s growing 15 percent per year versus the 4 or 4.5 percent growth on the total,” Donofrio said during the call.

Still, mobile wallet payments only make up less than 0.2 percent of the total payments made with Bank of America cards. Moynihan also spoke about the bank’s own P2P payments plans.

“Part of what you hear about is the new consortium to build a new P2P deployment for the banking system. We’re up and operating that, and we still have a few more months before the rest of the colleagues and the consortium get up and then we’ll start to push that out in the market heavily. I think it’s a tremendous improvement over what we have today, even though we have a fair amount of volume on it today through clearXchange and that was an effort to get us all together so we could have a very interoperable payment network.”

Perhaps by next quarter we’ll hear more about that.


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