Feature

Banking: Meeting the mobile challenge

Like so much else, banking is going mobile.

Like so much else, banking is going mobile, said Ann Carrns in The New York Times. As fees and other restrictions start piling up at traditional banks, an increasing number of consumers—“especially 20-somethings or ‘Millennials’”—are migrating to mobile banking. And while many “old-fashioned banks” now offer mobile banking apps, a few nimble upstarts, such as GoBank, Simple, and Moven, have begun to “appeal to younger customers and others on a tight budget because they shun most fees, including the dreaded overdraft fees, and have no minimum balance requirements.” These banking services “all aim to simplify payments” and to help customers track their spending, and because they work with traditional banks to store your cash, the money is still federally insured. But these services still aren’t perfect. Funds deposited by personal check can take several days to become available, and mobile banking services rarely pay interest.

You’d better get used to mobile banking, said Hanah Cho in The Dallas Morning News. It’s grown by 50 percent in just the past year, according to the consulting firm Accenture, and “banks are scaling back their traditional branch networks as consumers increasingly turn to their smartphones and tablets to bank.”

New gadgets can help ease you in to the new mobile reality, said Ellis Hamburger in TheVerge.com. Take the San Francisco startup Coin, for example, “a credit card–size device that digitally stores up to eight credit, debit, gift, or membership cards,” which you can toggle between by using a simple button. The Coin card can be swiped “in any conventional reader or ATM machine as if it were the original card itself.” Coin comes bundled with a reader that can scan your cards’ data into a mobile app for your phone, which then syncs with the card using Bluetooth. The Coin card’s magnetic strip changes on the fly to impersonate any of the original cards.

But “don’t cut up your credit card” just yet, said Colleen Leahey in Fortune. “You might think that Coin, Square,” and other mobile wallet apps would “threaten the dominance of leading credit card companies,” but Visa, MasterCard, and American Express “remain the connective tissue between consumers and merchants.” Those companies are trying to get into the mobile game, too, proposing the use of scannable codes that act as payment tokens. It’s possible that such innovations will make transactions even easier. But for the next little while, consumers and vendors may be left “confused by the diversity of payment options.”

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