Transactions on Mobile Devices Will Rise to 25% in 5 Years: Report

NEW YORK (TheStreet) -- While only 15% of financial transactions today take place on a mobile device, that number is expected to grow to 25% in five years, according to a new report from The Economist Intelligence Unit. The EIU ran two surveys to get a sense of how mobile is playing a role in banks and financial transactions. One surveyed 111 banking executives, and the other talked to 1,827 consumers from 48 countries around the world. The surveys looked at feature phones, as well as smartphones like Apple's iPhone and Google Android devices and tablets. According to the report, 82% of retail bankers believe that "in the next five years mobile devices will become the number one channel for millennials and younger consumers." Consumers in the survey said they use mobile banking primarily because of the ability to bank from anywhere at any time, and the easy access mobile banking provides. As mobile transactions become more popular, banks are being forced to acknowledge the new channel and integrate new technology to meet consumer demands, especially from younger audiences. "Increasingly, users rightly expect to be able to do whatever they need to do on whichever device they happen to be using at that particular moment," said Andres Wolberg-Stok, global head of emerging platforms and services at Citigroup . "If you can explore new types of services as well as providing more convenience, then you have a chance to leverage mobile to really create differentiation." Seven out of 10 retail bankers believe consumers "expect banks to provide the same quality of experience big Internet companies provide." They need to match the level of quality on digital wallets coming from places like Google and Apple. Banks are aware that they need to step it up on mobile, and to do so, they may have to partner with players like mobile-phone companies, retailers and social-media firms. All told, 71% of banks surveyed said they considered mobile phone providers to be potential partners, and 60% considered partnering with social media firms like Facebook . Plus, 54% saw big retailers like Wal-Mart as potential partners, and 51% thought Internet retailers like Amazon could become partners. Online payment firms like eBay's PayPal worried some banks, with 42% viewing it as a potential rival. And 50% of banks worried that Internet-only banks would become big rivals. "Banks and their regulators are going to have to embrace technology-driven innovation," said Peter Sands, chief executive of Standard Charted . "Otherwise it will simply happen by stealth, driven by players outside the industry." Must Read: 10 Most Popular Messaging Apps --Written by Rebecca Borison in New York >Contact by Email. Follow @borisonr // 0;if(!d.getElementById(id)){js=d.createElement(s);js.id=id;js.src="//platform.twitter.com/widgets.js";fjs.parentNode.insertBefore(js,fjs);}}(document,"script","twitter-wjs"); // ]]>

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