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Are mobile apps the future of banking?

Mobile-banking explores the future of banking and whether technology will replace traditional banking.

December 18, 2013 12:13 by

If you are out and about, and are suddenly reminded that you’ve forgotten to pay your credit card bill, help is at hand. Yes, you could call your bank or log onto your online account, but why not keep things simple and make the payment on a mobile banking app?

With all of us becoming increasingly reliant on mobile phones and smart devices, banks are aware that they must embrace new technology to reach and satisfy their customers. From drive-through bank branches to new accounts being opened on tablets and more, financial institutions are increasingly aware that providing digital services not only helps them keep up with their competitors, but also ensures they gain and retain new customers.

Mobile penetration and usage in the UAE is among the highest in the world. According to a recent survey by Bain & Company, 15 per cent of UAE consumers said that they used smartphones, tablets and computers for their daily transactions, while 40 per cent of respondents claim that using online or mobile banking would be their preferred way to bank.

To take advantage of this shift in the way customers carry out banking transactions – a shift that’s apparent among wealthier customers who demand even more direct channels with their bank – financial institutions need to move fast to ensure they are keeping up with the pack.

As a result, numerous UAE banks have launched mobile banking apps, enabling customers to manage their bank accounts using their smartphones – carrying out basic transactions, such as checking balances, paying bills and transferring money.

Will we see an end to bank branches?

As technology and mobile banking evolves, does this mean branches could die out as consumers carry out all of their transactions on their mobile phones? Well, perhaps one day, but not just yet.

A bank considering an app would be wrong to assume that simply having an app available is enough to keep their customers happy. They need to ensure that their app is safe, secure and effective. While providing an app that allows a customer to see how much is in their account is great, not offering the facility to make bank transfers or pay credit card/utility bills is not. In other words, customers want the same transaction options on their phone as they have online or in a branch.

There will be less bank visits, as customers handle more and more of their transactions remotely. There’s no doubt it’s far more convenient to pay a credit card or transfer cash while on the go. After all, who wants to drive 20 minutes to the nearest bank branch when they could simply tap on their smartphone and get the job done?

How traditional banking will evolve

In recent months, the UAE Central Bank, Etisalat and du agreed to work together on mobile banking technology to make mobile banking easier, cheaper and more accessible.

This will help to boost this area of customer service. However, before you panic, fearing that your nearest bank branch will close tomorrow, you can relax.

Branches may be downsized with less physical customer service staff on hand – instead allowing customers to carry out transactions through self-service machines or virtual banking terminals that connect them to advisers onscreen – but advisers will still be needed to assist customers with more complicated procedures, such as a complaint or a mortgage or loan approval. Of course, someone will have to be nearby to help customers struggling to operate these new technology intensive branches.

Remember, banks can only more forward if their customers want them to. According to a survey by the banking software solutions provider SunGard, 95 per cent of respondents from six nations across the Middle East region, including the UAE, still regularly visit their local bank branch.

Interestingly though, when asked what improvements they would like to see, more than four in ten said they wanted better mobile banking services from their financial institutions. Perhaps, one day, we will never need to go to the bank.


Ambareen Musa is the founder and CEO of Dubai-based financial comparison website,


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