The Revolution in Consumer Banking Consumer banking has been revolutionized by the advancement in information and communication technology. The modern approach to consumer banking is aimed at ensuring that the banking services are offered directly at the clients. This is where the consumers are able to execute transactions at their convenience without the manual process of visiting their banking institutions. In this regard, it is evident that technology as illustrated by the innovative smart phones is making it possible for transactions to be conducted by consumers from the palm of their hands (The Economist 1).
Other advancements such as multi processing computers which manage large amounts of data in a short time have also played a leading role in the revolutionized consumer banking. Consumer banking has also been motivated by the fact that customers are increasingly becoming willing to transact online (The Economist 1). It is the new trends in technology which have led to the assertion that banks will be transformed in the manner of providing consumer banking services to their clients. The future of consumer banking has been reflected to be characterized by very few bank branches across the streets because they are becoming less important with the application of technology in consumer banking (The Economist 1).
Mobile banking will completely replace the manual system of getting statements from banks and depositing their checks. Moreover, payments are speculated to involve money transfer of funds instead of the usual credit cards and cash payments at the shopping malls and supermarkets. In addition to the convenience in payments which would be achieved by mobile banking and transacting, financial relationships will be enhanced through avoidance of unnecessary fines and high interest rates which characterize credit card payment modes (The Economist 1). Furthermore, the fines in for inadvertent overdrafts are said to be forgotten with the emergence of mobile transacting.
The benefits of changes in consumer banking include the ability of customers to make deals via their mobile phones without being exploited by banks which aims at profiting from transactions. Migrants will benefit significantly through the mobile banking revolution in consumer banking (The Economist 1). This is illustrated by the fact that they would avoid the large sums of charges which regular banking imparts on them when they send money to their families back home.
The adoption of the smart phone in consumer banking has been said to override the old model of consumer banking in transacting accounts, personal loans, credit cards and debt cards (The Economist 1). Mobile banking is also a big opportunity for financial institutions especially banks. Banks will cut operational costs by closing their many braches. New revenues will also be enjoyed by companies in the increased transaction data and advertisements (The Economist 1).
More significantly, the advanced IT platforms and architectures in addition to the financial application software will enable banks to achieve economies of scale. Regardless of the benefits that have been revealed in mobile banking, it has been argued that the illiterate financiers may be eliminated by the new technologies. Moreover issues of security and privacy of consumer financial data and information has caused increased concern (The Economist 1). Work Cited The Economist. Consumer Banking: Counter Revolution. 2012. Web. 23 May 2012.