Small Businesses Underserved by Mobile Banking

February 24, 2014 – A report released by the Aite Group, based on a September 2013 survey of 1,003 U.S.-based businesses generating less than US$20 million in annual revenue suggests small business are currently underserved through mobile banking offerings, which are often simply rebranded versions of consumer mobile banking apps with limited capabilities.

To accommodate the underserved small business sector, the Aite Group says banks should consider offering enhanced small-business mobile banking capabilities, designed for both smartphones and tablets, such as initiating and approving ACH (automated clearing house) and wire transfers. Specialized features specific to small business that aren’t included in consumer banking apps would encourage small businesses to use more mobile banking.

51% of surveyed business ranked a bank’s mobile offerings as “important” or “very important”. 32% currently use mobile banking and 31% said they plan to adopt mobile banking during the next year. The primary reason small businesses cited not using mobile banking was concern over security; however those worries are being assuaged by education and tighter controls.

Additionally, investing in small business mobile banking has pay-off potential for banks; The Aite Group reported that 45% of small businesses with annual revenues of under $20 million using mobile banking spend more than $50 each month on banking products or services, making them some of the bank’s most valuable customers.

ETA, the Electronic Transactions Association, recognizes the inherent value of underserved markets, including the small business sector, and is making efforts to promote effective mobile tech solutions.

During our recent Strategic Leadership Forum (SLF)in October, ETA hosted the Payments Next Zone (PNZ), made possible through the Bill & Melinda Gates Foundation, which awarded $10,000 to the startup company judged to have the most innovative new electronic payments technology product or service with the greatest potential to make a profound impact on the global market delivering financial services to unserved / underserved individuals or communities worldwide.

You can access The Aite Group study here.

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