China - Mobile Banking Leader

Asia has embraced m-banking

Despite every major banking and telecom provider seemingly getting on the mobile banking bandwagon, the US is still lagging behind in the world of mobile finance.

According to a new survey by KPMG, China has taken the lead with 77 percent of consumers utilizing their phones to carry out financial transactions. Over the last 18 months, the global percentage of people who used their phones for banking has more than doubled, going from 19 percent to 46 percent.

Using phones to purchase goods has also increased, with service purchases rising from 10 percent to 28 percent.

As such, mobile banking has been described as the world's fastest-developing economies.

Chinese growth

The KPMG survey stated that in China, 77 percent of respondents said that they used their mobile phones for banking while 44 percent used it for retail transactions.

Compared to India, where 43 percent used their phones for financial business and 38 percent used them for purchases, it is quite a large lead.

If anything the survey revealed that users in the Asian-Pacific region have taken to mobile banking much more readily that those in the US and Western Europe.

As a comparison, only 19 percent of US users have done a banking transaction on their mobile, but this is still double the amount that was measured 18 months ago.

However, there are reasons for the difference in usage. In the US and Europe, privacy concerns and security issues are a major concern to many users with 52 percent stating this as the reason why they hadn't embraced mobile banking fully.

Lack of service availability was also a factor with nearly three-quarters of US respondents saying that their current bank either does not offer banking through a mobile device or that they did not know if their bank offered this service.

Speaking about the survey, Carl Carande a Principal at KPMG Banking and Finance Advisory Practice, said, "To continue to spur adoption, banks may need to continue to educate consumers about the security of the mobile banking environment and further promote the availability of this vehicle that helps make banking more accessible and convenient."

Boiled down, US banks are seriously going to have to up their game if they are to compete in the global market, especially as the use of smartphones has made it noticeably smaller.

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