Asian banks playing catch-up with mobile banking apps

30 June 2020 Consultancy.asia

In a new report by Sia Partners, the firm’s consultants have shed light on the state of the international mobile banking space, pinpointing the need for Asian banks to ramp up their game. 

Global management consulting firm Sia Partners benchmarked the mobile banking applications of 60 banks internationally, mainly in Europe and Asia. The researchers assessed the apps on 80+ criteria, including customer experience, ease of use, navigation and security, in the process identifying what leaders are doing to stand out in a crowded market.

Overall, the researchers found that Asian banks are still playing catch-up to their European counterparts, and can learn across a number of areas where they underperform. Mobile banking apps of European banks are for instance richer in their functionalities, and are easier to use and more often customisable. They also typically also offer better in-app advice, for example on investments and banking products. 

Notably, European apps tend to score higher in app stores (Apple, Android) than the apps of Hong Kong and Singaporean banks, suggesting that European users are – disregarding cultural differences in expectations and ratings – to a higher extent valuing the apps being offered.

Mobile banking apps - App Store Rating

Investing in mobile banking

Against the backdrop of the rapidly proliferating market for banking apps, which Sia Partners now describes as the “single most important channel between a bank and its customer both in Europe and Asia”, Asian retail banks are advised to step up their game. This need is further exacerbated by the increasingly tech-driven and design-savvy demands of the information-hungry younger generations.

Meanwhile, traditional banks such as HSBC, Hang Seng Bank, Standard Chartered Bank and Bank of China are facing mounting competition from neobanks (digital and agile banks also known as challenger banks), fintechs, new entrants with a big tech heritage, and other non-banking players.

“Investing heavily in the mobile channel and having the best app in the market will increasingly result in a major competitive advantage,” said Vincent Kasbi, a partner at Sia Partners and Head of its Asian division. 

“It not only results in a considerable competitive advantage today, but is also a must-have for mitigating the risk of customer disintermediation by both new entrants and historical competitors,” added Etienne Ranwez, a Manager at Sia Partners based in Hong Kong.

Functionalities - Features vs UX - UI

The region’s top banking apps

In Hong Kong, the apps of HSBC and Hang Seng Bank are found to be the most comprehensive and user-friendly, while ZA Bank is lauded by the benchmark for a number of “innovative features and a leading user experience.” DBS takes home the credits for providing the best user experience with its iWealth and Digibank apps. 

The latter bank however leads the pack in Singapore, on the back of its ability to provide a modern app which is adapted to the diverse and international banking needs of customers, according to Sia Partners. The silver medal goes to the UOB app.

But it’s not all catch-up for Asia’s banks. Especially in the area of payments Hong Kong and Singapore receive more plaudits than European banks. Thanks to FPS in Hong Kong (Faster Payment Scheme) and FAST in Singapore (Fast and Secure Transfer), Asian customers can enjoy instant payments solutions based on a link between bank accounts and phone numbers.

Moreover, integration with ancillary applications for P2P (Peer-to-peer) and POS (Point of Sales) payments is well-developed too in the region, and so are various other payments methods based on QRcodes and the Pay functionalities of top smartphone providers such as Apple and Samsung.