What is Mobile Banking? | Definition, Working, vs Types

Mobile/Cellular banking is operating your bank account via a mobile device. Phone banking allows the customer to perform the same tasks which can be done by visiting the branch. Phone banking not only saves time but also improves financial decisions. The bank provides an app on the store. It lets you make transactions, find nearby ATMs, check your bank balance, deposit checks, etc. Cellular banking offers various kinds of services:

1. Account information can be obtained, like balance, history, and e-statement.
2. Transactions can be made via the app.
3. Cellular banking also helps to open an online account for fixed/recurring deposits and mutual funds.
4. For other services like locating nearby ATMs and issuing/stopping a cheque.

Key Takeaways

1. Mobile banking is a digital banking service allowing customers to conduct financial transactions using mobile devices.
2. It offers balance inquiry, funds transfer, bill payments, and remote check deposits.
3. Mobile banking provides convenience, accessibility, and flexibility to customers, allowing them to manage their finances anytime and anywhere.

Features/types – Phone banking

1. Account information data

Cellular banking gives a mini-account statement

2. Transactions

Cellular banking enables users to transfer either to themselves or a third party. It also aids in bill payments.

3. Investments

Cellular banking is essential for managing investments (term deposits, etc.)

4. Support services

Customer support services aid in checking the status of loans or credit facilities.

5. Content and news

The latest bank-related services and other financial services are provided by cellular banking.

Advantages and Disadvantages of Mobile banking:

Advantages	Disadvantages
Examine your account all day, 24 x 7 services are provided by online banking.	Cellular banking is largely dependent on the bank’s app, which may not always work in order when required while making emergency transactions. This leads to a frustrating experience.
Time convenience for carrying out operations without visiting the branch, like cheque clearance.	The banks keep adding new features, creating a more complicated user experience. According to J.D. Power’s studies, more features decrease user satisfaction. The elder age group is most affected by it.
Paying IOUs gets easier and faster; payments get done without needing cash. You can also send a payment request as a reminder.	Mortgage through cellular banking is less preferable due to complicated bank terms; people prefer face-to-face banking.
Online banking has security measures to guard against cybercriminals. These security measures work even if a mobile phone gets stolen.
Banks like Ally and Bank of America allow customers to remotely disable credit and debit cards. Users don’t need to call and wait to follow the steps.
Transaction and low balance alerts are also added features with cellular banking.
The convenience of entering a bank account with just the tip of a finger is possible via cellular banking.

How does it work?

1. Any device with an internet connection is needed for making a transaction.
2. The account number is mandatory for transactions that are available at the bottom of a check, deposit slip, or front page of passbooks.
3. Then, log into your bank’s website via the device available.
4. Create an online account by filling in the details and creating a password.

Example

Bank A has a feature to help its checking account customers. It organizes and optimizes digital money. Plus, tips to save money or alert during risk of overdraft are also given.

References

1. https://www.sciencedirect.com/science/article/abs/pii/S0957417409002735