Weighing the pros and cons of mobile banking

Cheques could soon to be a thing of the past as more and more banks develop mobile banking apps.

Mobile banking lets you bank without a branch or computer. Most smart phones with an internet connection will let you keep track of your finances on the go with a range of products, tools, calculators and services to access your account on your mobile. You can find ATMs, branches or banker locations as well as online investing tools with some mobile apps.

What is mobile banking?

It’s a system that lets you, the customer of a financial institution, to process financial transactions through a mobile phone or device. This is not to be confused with contactless payments, which involves using the actual mobile device to pay for goods at services by ‘tapping’ it with another device. Mobile banking has been most successful with the iPhone and some Google Android devices.

What are the types of banking apps available on mobile?

Almost all financial institutions in Australia now have a mobile banking app that allows their customers to conduct their banking online. Here are the mobile banking apps that the big four have to offer;

• CommBank Kaching. Do your everyday banking basics like checking your account balances and transferring money. You can also pay anyone at anytime through your mobile, email or Facebook contacts. Login requires a 4-digit PIN instead of using your online banking password, and you can also pay new and existing BPAY billers.

• ANZ goMoney. Login requires a 4-digit PIN and you can securely access your ANZ account balances and transaction history. This app lets you transfer money between your ANZ accounts and pay bills with BPAY. You can also transfer funds to anyone if you have their Australian mobile phone number.

• NAB. Be able to access NAB services with a 4 digit passcode and check your account balance and transaction history. You can also transfer funds to linked accounts, or anyone else if you have their banking details as well as pay bills and view past and scheduled payments.

• Westpac Mobile Banking. View your balance, see past and future transactions and transfer money with this app. You can also schedule and pay bills using BPAY as well as save and view your eStatements. Also, you can use the Westpac home loan and personal loan borrowing calculator to see what your repayments will be.

How does mobile banking work?

To access mobile banking, you will first need to download the appropriate app that corresponds to your bank - usually your bank’s website will have a link for you to download. After you’ve downloaded the app, follow the prompts to set up your account. It may ask you to confirm your username and password as well as send you an SMS to confirm your identity. If you have any problems with setting it up, it’s best to go into a branch for assistance. When you’ve finished setting it up, you’ll be able to perform banking services as you would on a computer.

Some typical services include:

• Accessing your account information

• Making payments and transferring funds

• Monitoring investments

• Customer service and support

How to compare apps for mobile banking

• Security. Security of financial transactions are paramount to any mobile banking app. Ensure that all your financial details are kept safe with authentication by having a user ID, password and PIN. Encryption of data is also important so that hackers won’t be able to access your information - the same applies if you lose your phone.

• Compatibility. With the number of different mobile phone devices available today, you need to ensure that your bank has created a banking solution that suits your particular mobile phone. Some mobile phone models may only cater for a number of the functionalities that the banking app is capable of.

• Reliability. Banks have a lot of customers, so they need to able to produce a mobile-banking infrastructure to handle large volumes of transactions at a time. Services should be available 24/7 and all systems should be working within the app.

• Your bank. Your bank will be the main decider as to what mobile banking platform you should be using. This is because you can’t access your bank account details through another bank. If you’re looking to switch bank accounts then the quality of mobile banking provided by other financial institutions could be a factor in your decision.

Pros and cons of mobile banking

Pros

• Time saving. Instead of allocating time to walk into a bank, you can check account balances, schedule and receive payments, transfer money and organise your accounts when you’re on the go.

• Convenient. Do your banking at a time and place that suits you, instead of waiting in queues.

• Secure. Generally, good mobile banking apps have a security guarantee or send you a SMS verification code you need to input to authorise a payment for added security.

Cons

• Technology. Most mobile banking apps need an internet connection to be able to operate, so if you live in a rural area or experience problems with your internet connection, then you won’t be able to access your account. The same applies if your mobile phone runs out of battery.

Things to avoid when it comes to mobile banking

• Ignoring security measures. Mobile phone apps can only do so much on their own to ensure you’re secure, such as logging you out after a certain amount of inactivity or making you provide password or SMS codes. If you’re careless about your own security, such as doing your banking on a public wifi connection, then you risk your details being stolen regardless of how secure a mobile banking app is.

Frequently asked questions about banking on your mobile

• Where can I find more information about mobile phones? Please see our mobile phone comparison.

• I’m having trouble setting up my mobile banking system, where do I go for help? Please contact your bank directly via telephone or in-branch.

• Where can I download mobile banking apps? Mobile apps are available from the iTunes app store or Google Play. Some mobile banks apps aren’t available through phones that operate on the Windows or Blackberry system, so it’s best to check with your bank.

Mobile banking is used in many parts of the world and can be a great financial tool if used properly and securely. While you can enjoy doing your banking when you want where you want, always remember to always be cautious of your security.

This article was originally published  on Finder.com.au. You can read the original article here.