Mobile Banking Uptake: Bank of America Closing in on 1 million Mobile Users

Bank of America iphone mobile bankingIn its latest quarterly financial results (here), Bank of America said it signed up 224,000 new users during the quarter to bring its active mobile banking base to 840,000. Assuming the 75,000/mo pace continues through second quarter, the bank should be over 900,000 now and will surpass 1 million in the next few weeks.

Although it’s a nice milestone, it’s only 4% of the bank’s 23+million active online banking users (here). Given that mobile is pushed frequently in the bank’s online banking area, one could argue that 4% adoption is pretty anemic. But according to M:Metrics, less than 14% of U.S. mobile phone users accessed info via the mobile Web in February. So 4% of a 14% universe is much more impressive, indicating the bank has tapped almost 1/3 of the short-term potential for mobile Web-based services, a good start.

To really goose adoption, text-based solutions may need more emphasis (see Chase screenshot below). According to M:Metrics, U.S. text users outnumbered mobile Web users almost 4 to 1 in February, 110 million to 30 million.

Industry forecast update
These adoption rates are about what we expected. In the forecast published a year ago in our Online Banking Report on Mobile Banking, we were relatively bearish short term, projecting 900,000 mobile users by year-end 2007 growing to 2.5 million by the end of 2008.

With BofA reporting 840,000 and assuming they have about half of all users, the U.S. market has likely already passed the 1.5 million mark and will end the year at more than 3 million.

The adoption rate depends on how hard banks push mobile options. Along with BofA, Chase has been one of the most aggressive, showing mobile use in its advertising for several years now (previous coverage here). I love its “Text your account. It texts you back.” Just seven words conveying more than most 3-minute demos.


Chase Bank Text Mobile banking

Online Financial Services Scorecard: March 2008

Compete Netbanker Online Financial Services Statistics March 2008

According to data from Compete’s consumer panel, March rebounded from the lower traffic in February. Every product, except standard savings accounts, posted increases in the number of applications. Credit cards were the biggest gainer (up 24% in shoppers, up 13% in applications) following sharp declines the past few months. Home loans market performed similarly, with double-digit increases in applications for both purchase (up 15%) and refinances (up 12%). 

New this month, we have valid year-over-year comparisons shown (see note 1). Compared to a year ago, both checking and credit cards applicants and shoppers have risen significantly. Home loan shoppers are up slightly, but applications are up. 


  • Credit cards saw a large jump in both shoppers and applicants. The credit crisis seems to have benefited the credit cards market as applications, especially for balance-transfer cards, have increased. Compared to a year ago, shoppers are up 47% and applicants are up 53%. However, conversion dropped by 2% from February.
  • Deposits saw overall shopper loss in all three segments during March, but applications for checking were up 2% as were high-yield savings (up 8%). Last year at this time, deposits were increasing across all segments. In March of 2008, however, applicant levels are below what they were in 2007 with 31% drop in high-yield savings applicants and a 7% decline in all savings accounts.
  • After a terrible February, refinance mortgages posted a 27% gain in shoppers as well as a 12% gain in applicants. Year-over-year refinance applications are up 32% from a year ago. Purchase mortgages also saw a similar improvement from last month with a gain of 23% over last year. Home equity had the largest gain in applications in the month of March as leads/applications (note 2) grew 34%. Year over year, however, applications are down 32% due to the housing crisis of the past few months.

About the Financial Services Scorecard
A year ago, we introduced the Financial Services Monthly Performance scorecard produced by Compete. It summarizes the overall performance of 23 large U.S. financial institutions and lead-generation sites. Refer here for the detailed methodology as well as companies tracked.

1. New this month: Year-over-year comparisons are now included in the monthly table. Because of ongoing methodology tweaks, the percentages in this table may be slightly different than if you went back to the data from a year ago and calculated the change. 

2. Leads/applicants = Leads or applications depending on whether the site being tracked is a lead-generation site or an actual lender.

13% Would Use Banking in Facebook

In an unscientific poll of 500 Facebook users (see note 1), we found that 13% of respondents are interested in accessing their bank balance through their Facebook account (red bar below).

Source: Online Banking Report, 9 April 2008, n = 500

While that’s not exactly a ringing endorsement of the idea, it’s potentially enough early adopters to get the service rolling. Most of the interest emanated from younger segments. For example, 18% of 18-to-24 year-olds said they’d probably use Facebook banking (gray bar below) compared to about 5% of the 25-49 group (green and yellow bars below).

Source: Online Banking Report, 9 April 2008, n = 500

But it will take education to move “Facebook banking” into the mainstream. The majority of respondents, 70%, said there is “no way” they’d bank within Facebook and another 13% said probably not, resulting in a strong 83% negative rating. Given well-founded concerns surrounding online security, that’s not surprising. 

For more information:

1. Survey was conducted April 9 through Facebook’s polling mechanism. Total respondents = 500. Respondents are self-selected so the results should not be used to forecast specific demand.

Facebook Financial & Banking Apps Have Only 263 Daily Users

image It's been a while since we looked at the actual usage of payment, personal finance, lending, and banking apps on Facebook (previous coverage here; see note 1). And assuming the numbers provided by Facebook are accurate, it's not good news. 

Overall, the banking and personal finance apps have anemic usage levels totaling just 263 daily users (for apps with more than 1 daily user). That does not include virtual currencies or stock tracking/investing applications (see note 2). In comparison, the most popular general Facebook app, FunWall, has more than 3 million daily users.

But the number will grow rapidly if major financial institutions add balance inquiry functionality such as (#4) MyMoney from Fiserv's Galaxy unit (previous coverage here) and mShift's Key Point Credit Union app discussed here (only 1 daily user, so it did not make our table).  Activity in Facebook personal finance apps yesterday (13 March 2008):

Name (parent) Daily Users
1. PayPal (eBay) 80
2. Billmonk (Obopay) 55
3. LendingClub* 26
4. MyMoney (Fiserv) 17
5. PayMe 14
6. Debt Manager 10
7. Prosper 7
8. FriendFunds 7
9. UPside Visa Card Balance Reader 6
10. Web Money 6
11. Buxfer 5
12. IOU (Sanjay Madan) 5
13. Split It (TD Bank) 4
14. MoneyExchange (Revolution Money) 4
15. IOU (Jonas Neubert) 3
16. Mortgage Calculator 3
17. BillTrack 3
18. Insurance Marketplace 2
19. Wesabe 2
20. FB E-Wallet 2
21. Intuit Tax Tips 2
TOTAL 263**

*See comment 1

**Does not include apps with less than 2 users


1. You cannot make a meaningful comparison with last summer's activity because Facebook changed the way it reports usage. Previously, the company reported the number of application downloads and now it shows the much, much smaller "active daily user" total. For example, in July 2007, LendingClub had already had more than 11,000 downloads. Under the new measurement system it tallies just 26 daily users which puts it in third place (see table below).

2. The leading stock tracking app, Fantasy Stock Exchange, has 7,990 daily users. The most popular virtual currency AceBucks has 11,300 daily users.

Online Financial Services Scorecard: November 2007

Compete Online Banking & Financial Services Scorecard: Nov. 2007

The revolving credit season was off to a quick start as credit card applications posted a double-digit increase. However, all other product categories declined.

  • Monthly credit card applications rose 11% in November and conversion was up for all but one tracked company. Almost all companies experienced double-digit application growth as well.
  • Several key companies in the mortgage refinance space experienced significant losses among both shoppers and submitted leads/applications. Purchase shopper activity dropped 8% from October while applications saw a 19% drop.
  • Home equity saw a 27% decrease in shoppers, and a 13% decrease in total leads and applications.
  • In deposits, there was a slight decrease from last month in shoppers and applicants for savings and checking accounts. High-yield savings had 13% fewer shoppers. However, with large application growth turned in by several companies, total application volume slipped just 1%.

About the Financial Services Scorecard
In April, we introduced the Financial Services Monthly Performance scorecard produced by Compete. It summarizes the overall performance of 23 large U.S. financial institutions and lead-generation sites. Refer here for the detailed methodology as well as companies tracked.

Online Financial Services Scorecard: October 2007

Update, Dec. 10: The original chart, published Dec. 7, contained a mistake in the home equity application count. The correct number, shown above, is 82,362 instead of the 111,139 in the previous chart. NetBanker and Compete regret the error.

In April, we introduced the Financial Services Monthly Performance scorecard produced by Compete. It summarizes the overall performance of 23 large U.S. financial institutions and lead-generation sites. Refer here for the detailed methodology as well as companies tracked. 

Online credit card applications were up as consumers prepared for holiday shopping. In contrast, home loans continued their downward trend.

  • Monthly credit card applications rose 4% in October and conversion was up 5 points, reversing the prior month-over-month trend. 
  • Several key competitors in the home loans refinance and purchase categories saw significant losses among both shoppers and submitted leads/applications bringing total submitted mortgage activity down 11% from September.
  • Home equity saw a 14% decrease in shoppers and a 14% decline in total leads and applications submitted. Both direct lenders and lead aggregators saw declines this past month.
  • In deposits, there were 4% more shoppers across all categories (checking, savings and high-yield savings).  Only checking, however, was able to convert that into more online applications with a 7% increase.

Bank of America’s Online Banking Base Up 11%

The world's largest online banking base (note 1) grew an impressive 11% year-over-year, rising to 22.8 million active users, an increase of 2.2 million from 30 Sep 2006 (note 2). 

Bill payment grew slower, up 7% or 800,000 users, ending the period at 11.6 million active users. Overall bill pay volume is $224 billion annually, or $1,600 per user per month. Bill pay as a percent of online banking fell more than one point to just under 51% (note 3).  

Online Banking     Bill Pay     % of OL using Bill Pay

2007        22.8 mil            11.6 mil              50.8%

2006        20.6 mil            10.8 mil              52.4%

Change    +2.2 mil            +800,000            (1.6%)
                +10.7%               +7.4%

1. As far as we know, no bank in the world has more active online users; however, one could argue that PayPal, with 37.5 million active users in the latest quarter, is larger. Interestingly, ING Direct is closing in on BofA on a worldwide basis. With its Sharebuilder acquisition, ING Direct has 20 million accounts worldwide, about 30% in the United States, although not all are active, which BofA defines as being online within the past 90 days.

2. According to Doug Brown, Bank of America's SVP Product Innovation E-Commerce Channel Services, as cited during his BAI Retail Delivery presentation.

3. See Online Banking Report #137, p. 28, for totals back to 2000. 

Online Financial Services Scorecard: September 2007

Compete online financial sales chart

In April, we introduced the Financial Services Monthly Performance scorecard produced by Compete. It summarizes the overall performance of 23 large U.S. financial institutions and lead-generation sites. Refer here for the detailed methodology as well as companies tracked. 

In September, leads for home equity, mortgage purchase and refinance continued to decline. Regular savings accounts also dropped significantly, although the high-yield version savings booked an 8% increase.

Other highlights in September:  

  • Within the deposit category, checking accounts and regular savings declined; however, the high-yield category showed good growth with 137,000 online applications from two million shoppers, 11,000 more than last month.
  • While there were 8% more online credit card shoppers this month, lower conversion rates resulted in a 3% decline in submitted applications. 
  • On the loan side, both home equity and purchase mortgage categories experienced more shopping activity. But once again, a decline in conversion rates resulted in fewer submitted leads/applications. 
  • Refinance mortgages continued to slide in both online shopping activity (down 14%) and submitted leads/applications (down 8%). Several lenders saw double-digit percentage declines.

Web 2.0 Takes Over the Top-10 Internet Domains

Here's a great slide from Mary Meeker's Web 2.0 Summit presentation (download at Morgan Stanley) showing the dominance of social networking sites. If you haven't been able to get management to buy off on your social media plans, circulate this slide.

These are the top 10 domains now compared to two years ago as measured by Alexa. The red sites on the left have dropped out of the top 10 giving way to the green sites. Web 2.0-oriented sites can now claim six of the top-10 slots, including four social networks: FacebookOrkut (Google), Myspace and Hi5, and two user-generated sites:  YouTube and Wikipedia.    

Also according to Morgan Stanley, worldwide Internet use passed the 1 billion mark early last year, and is estimated to hit 1.3 billion this year. The chart also shows the distribution of Internet users by region. Note the dominance of the red part of the bar, and, no, that's not Republicans, it's Asia/Pacific.

Online Financial Services Scorecard: August 2007

Compete's online financial services purchase activity

In April, we introduced the Financial Services Monthly Performance scorecard produced by Compete. It summarizes the overall performance of 23 large U.S. financial institutions and lead-generation sites. Refer here for the detailed methodology as well as companies tracked. 

In August, the continued rise in interest rates led to a drop in home equity, mortgage refinance, and credit card applications while deposit accounts and purchase mortgage applications were up.

Some highlights from the monthly activity: 

  • Credit Card applications were down 2% overall, but Chase (27%) and Capital One (5%) grew applications and conversion compared to July
  • Savings applications were up across the group with the exception of Citibank which posted a 13% decline
  • For high-yield savings, only HSBC and ING Direct saw both application and conversion growth
  • Home equity application/lead volume and conversion dropped across the group with declines observed at 9 of 16 providers
  • Purchase mortgage  application/lead volume was up over July with Countrywide and Capital One both showing notable growth
  • The refinance mortgage market was flat overall, masking strong application/lead growth at Countrywide, E-Loan and NexTag while declines were recorded at LendingTree/GetSmart, LowerMyBills and Traffic = $17 billion bank

Compete's latest data confirms the spike in traffic at three-week old online personal finance startup Mint. The startup created considerable buzz after winning the $50,000 grand prize at TechCrunch in September (see previous coverage here).  

According to Compete, Mint's 200,000 unique visitors in September equaled that of $17-billion Webster Bank, the 64th largest U.S. bank or thrift holding company according to American Banker (Q1 2007). It will be interesting to see if Mint experiences a dramatic traffic decline after the publicity-driven visits slow down.   

Traffic at (blue) vs. Webster Bank <> (red)

Mint vs Webster Bank traffic