Going mobile: what is the future for bank accounts?

In recent months and years, we've seen real changes in the way people do their banking, or at least in how they plan to do it. With the rise of smartphones, mobile banking is starting to become more than just a nice idea, while many people nowadays wouldn't even know how to manage their money without online banking.

So what's next for banking? What can we expect to see in the future, and what parts are likely to die out?

Mobile banking

Mobile banking - that is, managing your finances using your mobile phone - still hasn't quite taken off, but it's well on its way. It's perhaps difficult to understand why banks haven't been quicker to meet the demand for online banking 'apps', but a few are now starting to emerge.

A few bank account providers offer apps that allow account holders to check their balance, see recent transactions and make payments to friends, family and bills. However, none of these apps allow you to do everything you can do on a computer - probably because of the potential security risks involved - and it may be a little while before mobile banking functionality catches up with internet banking.

Another recent development is the 'Pingit' app from Barclays, which allows customers to make payments of up to £300 a day to anyone else with the app. 20,000 people downloaded the app in the first two days, which is sure to have got other banks thinking about launching similar services.

And the Payments Council recently revealed that a system will be launched this year that will allow customers of any bank account provider to make payments from their mobile phone.

Contactless payments

NFC, or Near-Field Communication, is a new technology used in some debit/credit cards and mobile phones that allows users to make payments by swiping over a payment point. It's designed to be quicker than the current chip and PIN payment method.

Contactless payment technology hasn't quite taken off just yet, but several banks are offering the technology with new debit and credit cards, and many of the latest smartphones are NFC-enabled (including the Samsung Galaxy Nexus and the forthcoming Sony Xperia S). Contactless payment points are being pushed at this year's Olympics in London, which could lead to a surge in popularity, and they already exist at a number of retailers including McDonald's, Subway and Cafe Nero.

Bank branches

Some of us would no longer dream of going to a bank branch to withdraw cash or check our balance, but they still serve a purpose. Some people much prefer going to a branch to discuss taking out a mortgage or loan, for example - and some people, particularly the elderly, still use their branch for all their banking needs.

Bank branches are also key to many banks' visibility to potential customers on the High Street - as evidenced by the recent launch of Metro and Virgin banks, both of which have put a lot of time into making their branches look modern and welcoming.

Then again, for those who are happy to do without a branch, there are a number of online-only banks that often provide very competitive deals. 

Cheque books

There's been a lot of debate in recent months over whether cheques should still be used. It was announced back in 2009 that cheques were to be phased out by 2018 due to falling popularity, but it was later decided that this could disadvantage many people who are still used to making or receiving payments this way.

However, if mobile payments really take off, it could be that there is no real use for cheques within a few years.

Paper statements

Paper statements have been dying out for a few years now, with internet banking growing in popularity, and growing pressure for companies to become more 'green'. However, they still play a role for people who prefer not to use the internet to manage their money. Some banks also send them to customers who are overdrawn, presumably as a physical reminder for them to pay back what they owe.

It's possible we could see paper statements disappear within the next few years, but not before an overwhelming majority of people are using online banking.

Image © iStockPhotos / TommL

Tags: mobile banking, bank accounts, bank, contactless payments, contactless, payments, bank branches, cheque books, paper statements, printed statements

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