Banking Goes Mobile, With a Few Hitches

Dan Brower fished a much-awaited check from his mailbox but didn’t have time to swing by his bank’s branch.

So the Kansas City resident fired up his 2-week-old Smartphone, and with just a flick of his finger – disappointment. Commerce Bank’s mobile banking application doesn’t accept deposits.

“It’s funny because with PayPal’s app, you can take a picture of your check and put it in your PayPal account,” Brower said.

Mobile banking apps are widely available even if all of them don’t do the same things. A photo-based check deposit tool is coming soon to Commerce’s bank app.

New mobile banking ideas are popping up, too.

One banking app maker offers a feature that shows shoppers just what their planned purchase will do to their bank balances, taking into account those coming bills.

“We’re not very rational creatures when it comes to shopping,” said Lee Wetherington, director of strategic insight at ProfitStars, a division of Missouri-based bank technology company Jack Henry & Associates Inc.

And what about those who don’t have a bank?

No problem. There’s a mobile banking app for that, too. It’s a new mobile wallet feature on Boost Mobile phones from Sprint Nextel Corp., that taps into a venture backed by Leawood, KS-based Euronet Worldwide Inc.

Cool. Convenient. Time-saving. Free (mostly). Oh, and a little scary.

A survey last fall found that security concerns are one reason mobile banking has yet to catch on as much as banking from the home computer has.

Banking through a computer is nearly as popular as stopping at a branch. And shopping by phone is nothing new.

But mobile banking is relatively new, and consumers are still getting used to the idea.

A Federal Reserve survey last November found that only 29 percent of cellphone users had done any mobile banking in the preceding 12 months. Fewer than half of smartphone users had.

Those who do tap in from their phones find standard features. Apps allow users to check their account balances, whether a balance is in a checking account, savings account or credit card. Apps typically let customers transfer money between accounts at their bank, too.

Apps let users see recent transactions and find out whether a particular check has cleared. Some offer email alerts to remind you that the bills are coming due, so you don’t forget to pay.

And you can pay those bills using some banks’ mobile apps.

Many of these tools are possible with older style phones that don’t link to the internet, but can communicate with the bank’s computer through text messages.

It’s the camera that makes smartphones handier with money these days.

Increasingly, banks’ apps allow a customer to take a picture of a check – both sides, please – and remotely deposit it into his bank account.

U.S. Bank is putting the camera to work for bills, too.

Bill-paying features in bank apps generally require the customer to set up each biller by typing in key information, such as whom to pay and the customer’s billing account number.

U.S. Bank’s add-a-biller feature does all that from the smartphone’s photograph of the bill.

The bank recently went a step further. Its latest app feature uses that photograph of a bill to set up and make the payment.

Would that be enough to get customers to switch to U.S. Bank?

“We think there’s a lot of opportunity there,” said Chris Peper, vice president of mobile banking for the Cincinnati-based bank.

Commerce built its first banking app in-house, and has been letting customers find them, rather than promoting them actively. It launched an app for iPhones last summer, and its Android version began early this year.

“We don’t rush products or services to our customers until we’re sure those products will offer the best experience that our customers expect,” said Cindy Tetrault, website and online banking manager at Commerce.

Customers are responding. Mobile apps are one reason Commerce has customers in all 50 states, though its branch network is limited to six Midwestern states.

Commerce said it sees fewer customer visits to its branches, but Commerce customers bank more than ever, thanks to online and mobile banking.

“We’re looking right now at our next generation of mobile apps,” Tetrault said.

Some bankers remain in a wait-and-see mode.

“As a small bank, it’s hard to be on the cutting edge of technology,” said Travis Hicks, president and chief executive of Great American Bank.

Great American, with $79 million in assets, is among the smallest banks in the Kansas City area.

Hicks said customers like Great American’s online banking, but he will wait until mobile banking finishes dealing with the “trials and tribulations” that come with new products.

“It’s a product that, eventually, like online banking, almost every bank will have,” Hicks said.

One of the unsettled issues is price. Would you pay 50 cents to deposit a check by phone?

You will if you’re a U.S. Bank customer.

Peper said this feature means customers can skip the trip to a branch, or avoid the cost of a stamp. It becomes a “fee opportunity” for the bank because customers see that extra value, he said.

Tetrault said Commerce was assessing whether to charge a mobile deposit fee when it introduced the feature through its mobile banking app.

Fee decisions are subject to change. Tetrault notes that online bill paying wasn’t always free but has become a no-charge feature. Customers ultimately will decide what they’re willing to pay for.

Technology also means that being first with an app feature may not be a big advantage for a bank.

Two companies have teamed up to offer a mobile banking option for consumers without a bank.

It’s a mobile wallet that is now available on phones from Boost Mobile, a pay-as-you-go cell phone brand from Overland Park, Kan.-based Sprint.

A typical mobile wallet allows a consumer to use his smartphone to pay with his credit card, debit card or bank account. For example, Sprint offers the Google wallet on its phones.

Many consumers, including many Boost customers, don’t have a bank account or credit card.

A Boost Mobile wallet customer can load cash onto his phone and use its mobile payment feature to shop. The phone does this through technology developed by Wipit, a California company backed by Euronet.

Euronet mostly operates automatic teller machine networks around the world.

Kevin Caponecchi, a Euronet executive, said the company invested in Wipit because it was the only mobile wallet aimed at consumers who don’t have banking services and essentially live on cash. They wait in lines a lot to cash checks and pay bills.

Boost’s mobile wallet allows them to step out of line and pay bills using their phones. A photo deposit feature to load checks onto the phone is coming soon.

The Boost wallet also comes with a companion pre-paid debit card. The card allows the customer to tap into the same cash loaded on the phone whenever mobile payments aren’t available at a store.

Other new ideas coming to mobile banking include opening new accounts and helping consumers when they shop.

New accounts are trickier in the mobile world, because the bank has to be sure about with whom it’s dealing. And the customer needs to sign a signature card.

Wetherington said some banks’ apps include opening a new account.

Mobile And Safe

• Use your phone’s keypad lock, so others can’t tap into your bank application.
• Rely on Wi-Fi connections that are encrypted and require a password to use.
• Know how to report a lost or stolen phone promptly

Lost Or Stolen Phone?

Memorize the customer service number to call your wireless carrier (on a borrowed phone) so it can shut down your missing device.

• AT&T: 800-331-0500
• Sprint: 888-211-4727
• T-Mobile: 800-866-2453
• Verizon: 800-922-0204

Banking On Apps

Many banks offer customers a smartphone application that allows users to bank on the run. Here are some common features banking apps offer.

• Check account balances
• Review recent transactions
• Transfer money between accounts
• Find a nearby branch or ATM
• Receive alert when a check clears or as a bill reminder
• Send money to others
• Pay bills and make loan payments
• Deposit a check

How Do You Bank?

A survey last November showed far more cellphone users had been to a branch in the past 12 months than had tapped their mobile phones to do their banking.

• Branch: 85 percent
• Online: 74 percent
• ATM: 74 percent
• Telephone: 34 percent
• Mobile: 29 percent

Source: Federal Reserve