How Covid And Ongoing Investment Are Making Mobile Apps Stickier for Banks

The Covid-19 pandemic has helped fuel consumer adoption of mobile-banking apps by 67% of retail bank customers in the United States, up seven percentage points from 2020. And now no significant drop in consumer usage of these apps is expected as Covid-19 restrictions ease, says the J.D. Power 2021 U.S. Banking Mobile App Satisfaction Study.

A key factor in retaining new users is that banks have been investing significant resources in developing more consumer-centric user experiences. During the past two years, 40% of national banks and 29% of regional banks upgraded their mobile apps, according to J.D. Power.

“Several banks were investing a lot in their digital platform [which includes mobile apps] pre-pandemic, and it positioned them to capitalize quickly on that investment once the pandemic hit,” says Jennifer White, senior consultant, banking and payment Intelligence, for J.D. Power. “Going forward, you won’t see the number of branch-only consumers increasing. The digital channel has a strong foothold.”

From a customer-satisfaction perspective, large, national banks saw an eight-point increase in overall customer satisfaction with retail banking apps in 2021 on a 1,000-point scale, compared to 2020. Meanwhile, regional banks have seen their mobile-app satisfaction scores decrease 17 points in the past year. The disparity is being driven by large banks’ willingness to develop more sophisticated and personalized user experiences, says J.D. Power. 

Among national banks, Bank of America’s mobile app ranked first in customer satisfaction with a score of 871 points, followed closely by Chase with a score of 870. Capital One ranked third with score of 864. The industry average consumer satisfaction score for mobile-banking apps was 860. 

Ways large banks are enhancing the user experience on their app include advanced features such as proactive guidance, real-time alerts, and financial-planning tools that replace in-person interactions. By comparison, regional banks have focused on simpler, easier-to-use digital tools. 

“Banks needs to personalize their digital services to consumers’ needs,” says White. “Alerts should be connected to customer behavior. Account-management tools need to be reflective of how consumers use the digital tool, whether it’s an app or online. A consumer’s satisfaction with their last experience in a bank’s digital channel will influence their satisfaction [with] their next experience.”

Finally, the report points out that consumer adoption of mobile-banking apps is being spearheaded by more tech-savvy consumers, which in turn is leaving fewer savvy customers behind. Hence, banks looking to develop better user experiences for their mobile apps should consider bifurcating their designs to meet their customers’ technical capabilities.