Jeremy Pollack reveals statistics that show mobile banking uptake among the elderly, according to a US Federal Reserve study.
Mobile banking may be on the rise, but only 18% of American consumers over the age of 60 utilise it. The US Federal Reserve recently published a report called Consumers and Mobile Finance Services 2016, which looked at consumer use of mobile technology in regard to financial services and related decisions. Despite the low percentage, mobile banking use has actually increased among older Americans; usage has increased from 5% in 2011 and 13% in 2014.
So what’s behind the lag? One potential reason why older people eschew mobile banking options is the main reason among all age groups for not using such technology: it’s just easier to pay with cash or credit card. Mobile banking use is highest among American millennials (67%), with the report citing “love of tech” and “convenience” as reasons for use.
Similar findings in the UK
A UK survey by Compass Plus concerning age and consumer payment habits came up with similar findings. The survey of 650 UK residents found that age plays a significant role in financial decisions, with mobile/internet banking being most popular among those 45 years old or younger. Some 71% of consumers in this age group utilise internet banking options.
The percentage was about the same for the 30-45 age group and the under-21 group, at 57%. Survey participants over 45 said they preferred banking at their local branches (43%). The over-60 group wasn’t particularly interested in mobile banking, and said they opted for telephone banking over internet/mobile options. The under-21 group was unsurprisingly the least interested in telephone banking.
Still using smartphones
Despite the seeming lack of interest in mobile banking, 87% of the US adult population owns a mobile phone, and 77% of those own smartphones, compared to 71% in 2014 and 61% in 2013. As mentioned previously, mobile banking use has also increased over the last few years. For example, 53% of consumers with bank accounts had used mobile banking a year prior to the Federal Reserve report, compared to 52% in the previous year.
Despite changing percentages in the mobile banking world, use of some things remains the same. These include checking account balances and recent transactions, receiving alerts such as emails, text messages, and push notifications from banks, and transferring money between accounts.
Reaching older Americans
Smartphone use will probably continue to rise among older generations, a fact that presents banking institutions with great opportunities to reach these consumers. How can banks encourage their older consumers to try mobile banking? Emphasise its ease of use. The elderly have resisted various technological innovations, often because they appear too difficult to learn and use. However, this has changed in recent years. A 2013 Statistics Netherlands report found that the majority of 65-to-75-year-olds in the Netherlands were actively using the internet. Such activity had doubled since 2005.
Simplifying online/mobile banking as much as possible is undoubtedly a great way to entice older consumers. Text messages are still a favourite method of receiving notifications about (practically) everything, as people almost always have their phones with them. Marketing SMS is subsequently a viable way to reach the elderly population. Other tactics include loyalty coupons and incentives, ATM locator functions, and remote deposit options.