The Emergence of Mobile Banking in Ghana

By: WAYNE NYARKO

Times have changed so fast that people hardly ask of radio and camera futures in mobile phone before buying them. Mobile phone operating systems like Andriod, Widows, and IOS, are the critical futures mobile phone lovers ask when buying any mobile device.

Mobile devices are changing the world and transforming our lives, our daily behaviors, and how we do business with banks. Customers are abreast with time and changes as mobile technologies progress, pushing banks to be more consumer-driven.

According to BIZTECH Africa, an online technology portal, advanced mobile technology will be commonplace around the globe by the year 2020 with smartphone subscribers reaching 6.1 billion. The report further suggests that 70 percent of the world’s population will be using smartphones.

In Africa, mobile subscription in the first quarter of 2015 was around 910 million. The total number of mobile voice subscribers in Ghana alone stood at 37.3 million as at the end of October 2016, according to figures released by the National Communications Authority (NCA), the industry regulator.

Satisfying Customer Needs

The traditional ways of going to the banking hall to transact banking business is gradually fading away in Ghana with the acceptance of technology by customers. Today’s mobile phone devices have made life so simple for bank customers and, for that matter, banks are forced to offer more simple ways of doing business to these ever-growing customers.

Banks operating in Ghana like Stanbic, Ecobank, Barclays, Stanchart and Access Bank have taken the lead in ensuring their customers enjoy that simple and stress-free way of banking by introducing mobile banking to them. With a tap of an application (app) on their smartphones, customers can now open bank accounts, transfer funds from account to account, make interbank transfers, and pay bills without being physically present in the banking halls.

The way banking transactions are done today has changed and, for banks to survive in a mobile-first customer environment, it is important that they keep up with mobile trends by tailoring their products, services and businesses to suit customers’ needs and creating customer-focused mobile apps.

Beyond Basics

Prior to the invention of the mobile phone devices, banks had only one touch point to manage: the branch. Since then, new channels just keep on coming: Automated Teller Machines (ATMs), online help desks, call centers, Point-of-Sale (POS) devices, and social media. The number of customers who do not see (and never want to see) the four walls of a bank branch again continue to grow.

Mobile banking is gradually gaining grounds in Ghana and it is beginning to play a major role in how financial institutions interact with their customers. Formerly, it was not an uncommon practice to walk straight to any bank’s branch to make a simple transaction or do funds transfer. Even though some banks continue to design their mobile banking apps to give convenient banking, most of these mobile banking apps being offered only provide basic tasks like checking account balances, making transfers and opening bank accounts.

It is, however, important for banks to admit and accept that the branch is no longer the epicenter of their delivery model. Branches now exist as part of the broader ecosystem that includes all channels, with digital touchpoints taking the lead. That’s not to say branches are irrelevant; branches are still part of the customer experience equation. Customers, especially older customers like pensioners and people not familiar with technology, will still prefer brick-and-mortar branches. However, banks must go beyond simple transactions on the mobile banking apps if they hope to stay connected with their ever-growing, technology-savvy and younger customers.

Value added services

The banking industry is dealing with hyper-informed customers who are constantly looking to get more from their mobile devices. Mobile banking can be used as a springboard to extend the portfolio of services offered by mobile apps to create new sales and communication channels.

The ability to use mobile apps to check account balances and doing interbank funds transfers offers customers some added services from their banks. There should be more complex services available on mobile banking apps such as requesting loans or making loan applications and other web-based payments.

Reducing operational costs

Mobile banking services not only fill the need for “anytime” banking for customers, they also have the potential to reach out to a large un-banked population, thereby bringing more people onto the financial system and enhancing the reduction of poverty. A case in point is the surge in mobile money revolution in the country. The service does not only fulfillcustomer’s needs but also lower banks’ operational costs by reducing the need for setting up physical branches.

However, this does not mean that jobs at the bank branches will disappear. Employees will simply need to jump into different roles to build their careers. Customers will still have positive perceptions of physical branches due to the human touch they provide when it comes to long-term financial decisions, such as mortgages and financial advice.

Low operating costs and higher penetration rates of mobile phones across all demographics make this particularly attractive in developing markets. While mobile financial services offer an enhanced value proposition to current and future banking customers, the medium also provides a viable business case for banks through increased revenues.

Ecobank, Stanbic, Barclays, Access, and Standard Chartered banks, apart from providing their traditional physical branch services, also offer some form of mobile banking services with a smartphone app or a mobile website which have been launched in the past 18 months. The fact that the banking industry’s flagship awards programme-The Ghana Banking Awards-has award categories for ‘Most Active e-zwich Bank’ and the best bank for the ‘Promotion of Branchless Banking’, attest to the fact that mobile banking is here to stay.

Future of banking apps

There is much for the awe-inspiring world of mobile applications development. Apps are operating on smart phones and users are running with the smarter and better applications. Social media has also become arguably the biggest platform to market a bank and attract customers and banks should make it a part of their mobile banking solutions. The applications should provide customers with the facility to share messages and reviews on social media, especially at the end of successful sales processes and interactions. Social media is also a cheaper but effective means of gathering customer feedback and sentiment which banks must exploit.

There is yet to be seen any apps directly linked to social media, but apps should be a gamification. Customers should be rewarded for using the mobile app system which, in turn, would help to reduce demand on human resources and adding a new channel that customers of financial institutions will embrace.

Bankers must acquire a greater understanding of their customers and push services that go beyond transactional. Connecting data from third-party apps, learning customers’ saving habits, and analysing customer’s spending behaviours will allow banks to create complete profiles of individuals and lead to successful introduction of banking products to meet customer’s needs.

GB&F

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