Australia’s Mobile Banking Users to Outnumber Desktop-Based Users by 2018

Tue, Jan 8, 2013

Financial News

Various recent statistics informed, on the one hand, that Australians are much more likely than British and American citizens to use mobile banking apps, and, on the other, that Australia is a major market for Wi-Fi and 3G-ready smart phones, it’s no wonder that the official news has finally emerged. The news comes from Westpac, which has recently informed that, by 2018 mobile banking services users will outnumber online banking services. The announcement was made by Jason Yetton, the bank’s business banking group executive, during talks at the FST Media 7th Annual Technology & Innovation Conference, which took place in Sydney in early November.

According to Yetton, at the moment Australia can boast well over 3.4 million customers who are active in the online banking sector. Of these 3.4 million, half are using mobile financial and banking apps, for all sorts of specific activities, which range from checking their credit balance to paying their utility bills via an Internet connection, be it mobile or not. In the words of the same Westpac official, the bank is expecting the number of mobile banking service users to close in on regular online clients over the coming six years. On an equally optimistic note, Westpac forecasts that by 2018, it will have some five million active mobile and online banking services users.

One factor that will contribute to the significant improvement, says Yetton, is the increased availability and adoption of mobile tablets, which will help drive usage upward. By 2016, he predicted, half of all Australians will own such a device, and it is a likely assumption that many of them will be using their tablets to conduct banking transactions. This, of course, also means that the bank will be enjoying a significantly boosted number and total value of transactions—upward of one billion transactions, whose worth has been predicted to surpass six trillion dollars. If this amount seems astronomic, consider the fact that, at the moment, there are three times as many online transactions processed via Westpac than via the bank’s offline branches.

Westpac and other major players in the financial sector are currently faced with new and increasingly difficult challenges. Although the local economy has been showing consistent signs of improvement over Q3 of 2012, consumer sentiment indices remain relatively low. In the face of consumer conservatism, banks are finding themselves faced with the issue of having to identify new ways of acquiring capital and liquidities. One possible direction for growth, spurred by the improvement on Australia’s real estate market, would be a return to promoting home loans. Our research revealed that several such products are currently being offered at Bankwest and the rates provided indicate that the market is growing increasingly competitive by the minute.

While some banks will try and devise ways to wrest clients away from their competitors, the Westpac executive suggests that his bank will be predominantly focusing on innovative advertising, as a means to boosting its profitability. According to Yetton, it is highly important for banks and other business ventures to concentrate on building their social media platform presence, since social media represents a move away from static online content, and into a new digital era, where client and lender are freely conversing and generating online communication about the brand. Facebook and Twitter were cited as relevant examples by Yetton, who stressed the importance of realizing that social media is still in its early days. As such, it holds an advertising, marketing and communication potential that has yet to be harnessed. Since mobile banking seems to be the sure-fire, immediate future for Australia’s big four, and not only, it is only logical that banks should be focusing on such innovative methods for advertising.

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