The analysis and conclusions set forth in this presentation - - PowerPoint PPT Presentation
The analysis and conclusions set forth in this presentation represent the work of the author and do not indicate concurrence of the Federal Reserve Board, the Federal Reserve Banks, or their staff. Mention or display of a trademark, proprietary
The analysis and conclusions set forth in this presentation represent the work of the author and do not indicate concurrence of the Federal Reserve Board, the Federal Reserve Banks, or their staff. Mention or display of a trademark, proprietary product, or firm in the presentation by the authors does not constitute an endorsement or criticism by the Federal Reserve System and does not imply approval to the exclusion of other suitable products or firms. 1
– Rapid increase in use of mobile banking and mobile payments in
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33% 51% 17% 24% 28% 48% 15% 24% 21% 42% 12% 23% 0% 10% 20% 30% 40% 50% 60% Mobile banking users Mobile banking users (smartphones) Mobile payments users Mobile payments users (smartphones)
Change in mobile banking and mobile payments
2011 2012 2013
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33% 51% 28% 48% 21% 42% 0% 10% 20% 30% 40% 50% 60% Mobile banking users Mobile banking users (smartphones)
Change in mobile banking and mobile payments
2011 2012 2013
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11.4 39.1 20.6 22.3 33.7 26.1 31.7 20.7 28.1 34.5 6.6 25.2 10 20 30 40 50 60 70 80 90 100 % % % No Yes Total
Mobile banking by age
18-29 30-44 45-59 60+
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73.8 62.5 70 7.4 11.1 8.6 5.6 5.9 5.7 11.8 19.2 14.3 10 20 30 40 50 60 70 80 90 100 % % % No Yes Total
Mobile banking by race
White, Non-Hispanic Black, Non-Hispanic Other, Non-Hispanic Hispanic 2+ Races, Non-Hispanic
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17.1 10.4 14.9 16.3 16.5 16.4 27.1 27 27.1 14.9 17.4 15.7 24.6 28.8 26 10 20 30 40 50 60 70 80 90 100 % % % No Yes Total
Mobile banking by income
Less than $25,000 $25000,- $39,999 $40,000 - $74,999 $75,000 - $99,999 Greater than $100,000
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9% 20% 31% 31% 8% 0% 5% 10% 15% 20% 25% 30% 35% In the last 6 months 6 to 12 months ago 1 to 2 years ago More than 2 years ago I don't remember
When did you start using mobile banking?
*n=640
11
1% 2% 4% 6% 16% 32% 37% 0% 5% 10% 15% 20% 25% 30% 35% 40% To receive fraud alerts or check my account for fraudulent transactions Other There is no bank branch or ATM near my home or work I became comfortable with the security of mobile banking My bank started offering the service I got a smartphone I liked the convenience of mobile banking
What was the main reason why you started using mobile banking when you did?
*n=640
12
38% 41% 43% 44% 57% 72% 93% 21% 24% 29% 27% 53% 49% 87% 11% 21% 33% 26% 42% 48% 90%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Deposited a check using your mobile phone camera Located the closest in-network ATM for your bank Received a text message alert from your bank Made a bill payment using banking website or app Transferred money between your bank accounts Downloaded your bank's mobile banking app Checked an account balance or recent transactions
Using your mobile phone, have you done any of the following in the past 12 months?
2011 2012 2013
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4% 7% 12% 17% 35% 44% 44% 69% 75% 89% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% I don't have a bank account My bank charges a fee for using mobile banking I don't do the banking in my household It's too difficult to use mobile banking I don't trust the technology I don't have a smartphone The mobile phone screen is too small I'm concerned about the security of mobile banking I don't see any reason to use mobile banking My banking needs are being met without mobile banking
What are the main reasons you have decided not to use mobile banking?
*n=782
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25% 26% 26% 27% 29% 39% 51% 0% 10% 20% 30% 40% 50% 60% Make bill payments Deposit a check electronically using your mobile phone camera Download your bank's mobile banking app Transfer money between accounts Receive text message or e-mail alerts from your bank Check an account balance or check recent transactions None, I don't want to use mobile banking
Assuming that the concerns that you have about using mobile banking were addressed, would you be interested in doing any of the following activities with your mobile phone?
*n=782
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7% 23% 31% 39%
Age distribution for individuals who would not mobile bank, even if their reasons for not mobile banking were addressed
18-29 30-44 45-59 60+
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17
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4% 8% 25% 38% 41% 42% 49% 52% 0% 10% 20% 30% 40% 50% 60% Other Saving reminders Credit card balance alerts Fraud alerts Deposit or withdrawal alert Payment due alerts Statement available notification Low-balance alerts
What kinds of alerts (text message or email) do you receive?
*n=400
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19% 32% 37% 47% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% None Deposited money into the account with the low balance Reduced my spending Transferred money into the account with the low balance
Thinking of the most recent low-balance alert you received, which of the following actions did you take after receiving the alert?
*n=201
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Mobile payments are purchases, bill payments, charitable donations, payments to another person, or any other payments made using a mobile phone
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18.9 35.7 21.8 25.3 32.6 26.6 28.6 21.4 27.4 27.2 10.4 24.3 10 20 30 40 50 60 70 80 90 100 No Yes Total
Mobile payments by age
18-29 30-44 45-59 60+
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72.1 49 68.1 8.2 21.2 10.5 5.8 5.3 5.7 12.8 22.1 14.4 10 20 30 40 50 60 70 80 90 100 No Yes Total
Mobile payments by race
White, Non-Hispanic Black, Non-Hispanic Other, Non-Hispanic Hispanic 2+ Races, Non-Hispanic
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17.8 13.8 17.1 16.4 19.3 16.9 25.4 28.4 25.9 15.3 14.6 15.2 25.1 23.9 24.9 10 20 30 40 50 60 70 80 90 100 No Yes Total
Mobile payments by income group
Less than $25,000 $25000,- $39,999 $40,000 - $74,999 $75,000 - $99,999 Greater than $100,000
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18% 20% 18% 15% 25% 0% 5% 10% 15% 20% 25% 30% In the last 6 months 6 to 12 months ago 1 to 2 years ago More than 2 years ago I don't remember
When did you start using mobile payments?
*n=372
25
2% 4% 4% 7% 7% 14% 26% 37% 0% 10% 20% 30% 40% A store I visit started offering the service To take advantage of loyalty or rewards points and discounts Refused to answer Other I became comfortable with the security of mobile payments The ability to make mobile payments became available I got a smartphone I liked the convenience of mobile payments
What was the main reason why you started using mobile payments when you did?
*n=372
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14% 8% 29% 39% 21% 64% 59% 8% 6% 15% 30% 9% 42% 35% 16% 2% 8% 21% 1% 23% 36% Made a payment using a text message Waved or tapped my mobile phone at a cash register Received money from another person's bank or other financial account Transferred money directly to another person's bank or other financial account Scanned a barcode or QR code using mobile phone to make a mobile payment Paid bills online through a mobile web browser or app Made an online purchase
Changes in types of mobile payments made (Among those who made mobile payments)
2011 2012 2013
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15% 12% 17% 4% 24% 5% 13% 30% 0% 5% 10% 15% 20% 25% 30% 35% Transferred money directly to another person's bank or other financial account Received money from another person's bank or other financial account Paid for a product or service at a store Paid for parking, a taxi, or public transit using an app Paid bills online through a mobile web browser or app Made a payment using a text message Used an app to receive loyalty or reward points Made an online purchase
Using your mobile phone, have you done each of these in the past 12 months? (Among smartphone users)
4% 5% 5% 9% 40% 42% 54% 0% 10% 20% 30% 40% 50% 60% Charges to your phone bill Other General purpose prepaid card Account at a non-financial institution Bank account Credit card Debit card
When making mobile payments, which of the following payment methods do you use?
*n=372
29
3% 14% 18% 39% 0% 10% 20% 30% 40% 50% Other Waved or tapped my mobile phone at a cash register Used a mobile app that doesn't require tapping the phone at a cash register
Scanned a barcode or QR code using mobile phone to make a mobile payment
When you used your mobile phone to pay for something at a store, did you use it in any of the following ways?
*n=206
30
0.1% 0.9% 1% 1% 5% 7% 11% 14% 0% 4% 8% 12% 16% LevelUp Dwolla Isis Tabbedout Square Wallet Google Wallet PayPal In-Store Payment Starbucks mobile payments
Have you used any of the following mobile payment services in the past 12 months? (Among those who made a mobile payment and own a smartphone)
*n=331
31
77% 40% 4% 68% 40% 5% 66% 45% 8% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% Credit card, Debit card, or Prepaid card Bank account Charged to phone bill
Funding method for mobile payments
2011 2012 2013
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23% 27% 34% 37% 44% 46% 61% 63% 76% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% I don't need to make any payments or someone else pays the bills The places I shop don't accept mobile payments It's difficult or time consuming to set up or use mobile payments I don't really understand all the different mobile payment options I don't trust the technology I don't have the necessary feature on my phone I don't see any benefit from using mobile payments I'm concerned about the security of mobile payments It's easier to pay with cash or a credit/debit card
What are the main reasons you do not use mobile payments?
*n=1,956
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1% 4% 11% 12% 13% 16% 17% 20% 21% 22% 62% 0% 10% 20% 30% 40% 50% 60% 70% Refused to answer Transferring money to someone in another country Making payments to another person Accepting payments from another person Using your mobile phone as a "virtual wallet" Using my mobile phone to pay for purchases at a store Buying goods or services online Receiving specials and discount offers Paying bills online Receiving/using coupons on your phone None, I don't want to use mobile payments
Assuming that the reason(s) why you do not currently use mobile payments was addressed, which of the following activities would you be interested in doing with your mobile phone?
*n=1,956
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15% 22% 30% 33%
Age distribution for individuals who would not use mobile payments, even if their reasons for not using mobile payments were addressed
18-29 30-44 45-59 60+
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17% 33% 16% 12% 22% 17% 33% 16% 12% 22% 17% 41% 13% 10% 18% 0% 10% 20% 30% 40% 50% Very likely Likely Unlikely Very unlikely Don't know
How likely do you think it is that mobile payments will become a major way people make payments in stores in the next five years? (Asked of those with mobile phones)
2011 2012 2013
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1% 10% 23% 22% 42% 1% 8% 19% 27% 44% 2% 6% 15% 30% 45% 0% 10% 20% 30% 40% 50% I already use it Very likely Likely Unlikely Very unlikely
If you were offered the option of using your mobile phone to pay for purchases in store, how likely would you be to use it? (Asked of those with mobile phones)
2011 2012 2013
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2% 15% 44% 38% 0% 10% 20% 30% 40% 50% Definitely will use Probably will use Probably will not use Definitely will not use
Do you plan to use your mobile phone to make a payment in a store in the next 12 months? (Asked of those with a smartphone)
*n=1,145
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1% 15% 19% 25% 28% 34% 50% 0% 10% 20% 30% 40% 50% 60% Refused to answer Organize, track, and store gift cards, memberships, loyalty and reward points To receive offers and promotions based on your location To receive and manage discount offers and coupons Track your finances Compare prices when shopping None of the above
Would you or do you already like to use your mobile phone for any of the following purposes, assuming they were made available to you?
*n=2,341
39
40
41% 27% 34% 42% 32% 44% 44% 31% 42% 0% 10% 20% 30% 40% 50% Used mobile phone to comparison shop over the Internet while at a retail store Used a barcode scanning app on mobile phone while shopping at a retail store to find the best price for an item Used mobile phone to browse product reviews or get product information while shopping at a retail store
Shopping Behavior Using Mobile Phone
2011 2012 2013
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34% 64% 70% 33% 69% 74% 0% 10% 20% 30% 40% 50% 60% 70% 80% Scanned a QR code to obtain information about a product on mobile phone Use of a mobile phone to compare prices while shopping has changed where purchase was made Reading reviews on mobile phone while shopping has changed which item was purchased
Use of Smartphones when Shopping
2012 2013
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64% 53% 69% 50% 0% 10% 20% 30% 40% 50% 60% 70% 80% Used mobile phone to check account balance or available credit before making large purchase Decided not to buy item because of the amount of money left in account or available credit
Using Just-in-time Financial Information while Shopping
2012 2013
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5% 31% 33% 29% 0% 5% 10% 15% 20% 25% 30% 35% Strongly agree Agree Disagree Strongly disagree
Willing to allow my mobile phone to provide my location to companies I shop with regularly so that they can offer me discounts, promotions, or services based on where I am
*n=1,365
44
3% 16% 38% 41% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% Strongly agree Agree Disagree Strongly disagree
Willing to allow my mobile phone to provide personal information to companies I shop with regularly so that they can offer me targeted discounts, promotions, or services
*n=1,365
45
46
6% 32% 26% 18% 17% 0% 5% 10% 15% 20% 25% 30% 35% Very safe Somewhat safe Somewhat unsafe Very unsafe Don't know
How safe do you believe people's personal information is when they use mobile banking?
*n=2,341 61% 38% 0% 20% 40% 60% 80% Yes No
Do you password protect your smartphone?
*n=1,365
47
27% 52% 8% 3% 9% 2% 15% 17% 15% 50% Very safe Somewhat safe Somewhat unsafe Very unsafe Don’t know
2012
Not a mobile banking user Mobile banking user
How safe do you believe people's personal information is when they use mobile banking?
15% 56% 17% 4% 7% 2% 22% 30% 25% 20% Very safe Somewhat safe Somewhat unsafe Very unsafe Don’t know
2013
Not a mobile banking user Mobile banking user
48
How safe do you believe people’s personal information is when they use mobile banking?
15% 56% 17% 4% 7% 27% 52% 8% 3% 9% 0% 10% 20% 30% 40% 50% 60% Very safe Somewhat safe Somewhat unsafe Very unsafe Don’t know
Mobile banking users
2012 2013 2% 22% 30% 25% 20% 2% 15% 17% 15% 50% 0% 10% 20% 30% 40% 50% 60% Very safe Somewhat safe Somewhat unsafe Very unsafe Don’t know
Not a mobile banking user
2012 2013
49
11% 51% 17% 8% 11% 3% 26% 29% 22% 20% Very safe Somewhat safe Somewhat unsafe Very unsafe Don’t know
2013
Not a mobile payments user Mobile payment user
How safe do you believe people’s personal information is when they use a mobile phone to pay for a purchase at a store?
50
1% 2% 3% 5% 8% 12% 25% 45% 0% 10% 20% 30% 40% 50% Other Malware or viruses being installed on my phone Companies misusing my personal information Someone using my phone without permission to access my account Losing my phone
phone stolen My phone getting hacked Someone intercepting my data All of the above
Specific security concerns with mobile banking (Among those who expressed a concern about security)
*n=538
51
1% 2% 4% 9% 10% 22% 52% 0% 10% 20% 30% 40% 50% 60% Other Malware or viruses being installed on my phone Companies misusing my personal information Losing my phone or having my phone stolen My phone getting hacked Someone intercepting my payment information
All of the above
Specific security concerns with mobile payments (Among those who expressed a concern about security)
*n=1,258
52
– Use of remote deposit capture has nearly doubled in past year (going from 21% of mobile banking users in 2012 to 38% in 2013)
– However, use of mobile phones to make point of sale purchases has almost tripled in past 12 months (from 6% to 17% of smartphone owners)
past year among both users and non-users
– Large shift from people not knowing how secure the services are to thinking that they are unsafe
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54
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96.7% 41.4% 61.4% 3.3% 58.7% 38.6% Feature phone Smart phone Total underbanked population
Mobile banking use by underbanked population
Mobile banking user Not a mobile banking user
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96.7% 41.4% 61.4% 3.3% 58.7% 38.6% Feature phone Smart phone Total underbanked population
Mobile banking use by underbanked population
Not a mobile banking user Mobile banking user