Page 12 - Consumers and Mobile Financial Services 2014

4 Consumers and Mobile Financial Services 2014

at 95 percent confidence. Only questions pertaining Mobile phone and smartphone usage does vary with
to these topics are discussed in the report; however, the level of household income. In households earning
the complete survey questionnaire and the results of less than $25,000 per year, 74 percent of adults have a
the entire survey are summarized in appendix 2 and mobile phone of some type, and 44 percent have a
appendix 3. smartphone. Use of both mobile phones and smart-
phones increases nearly linearly with income cat-
egory, reaching 96 percent and 75 percent, respec-
Overview of the Mobile Phone tively, for adults in households earning more than
Market $100,000 per year.

As of December 2013, 87 percent of the U.S. popula- The relatively high prevalence of mobile phone and
tion ages 18 and above owned or had regular access smartphone use among younger generations, minori-
to a mobile phone. Of the mobile phone owners, ties, and those with low levels of income—groups
2
61 percent had a smartphone. While the percent of that are prone to be unbanked or underbanked—
the adult population with mobile phones has makes mobile phones a potential platform for
remained constant over the past year, smartphone expanding financial access and inclusion (see box 1
ownership increased substantially from the 52 per- for survey results related to the unbanked and
cent found in the 2012 survey. 3 underbanked).

Rates of mobile phone usage remain high and consis- Trends in the Utilization of
tent across demographic and socioeconomic groups. Mobile Banking and Payments
The prevalence of mobile phones demonstrates the
extent to which they have become engrained in mod-
ern culture. Mobile phone usage is approximately Services that allow consumers to obtain financial
91 percent for persons ages 18 to 44, and declines account information and conduct transactions with
only slightly to 87 percent for persons ages 45 to 59 their financial institution (“mobile banking”) and
and to 81 percent for persons ages 60 and over. How- that allow consumers to make payments, transfer
ever, smartphone adoption is higher among younger money, or pay for goods and services (“mobile pay-
generations: 79 percent of those ages 18 to 29 who ments”) have become increasingly prevalent over the
own a mobile phone have a smartphone, declining to past year. In the 2011 survey, for instance, 21 percent
77 percent of mobile phone owners ages 30 to 44, of mobile phone users and 42 percent of smartphone
58 percent of mobile phone owners ages 45 to 59, users reported that they had used mobile banking in
and only 33 percent of mobile phone owners ages 60 the past 12 months. By 2012, the prevalence of
and over. mobile banking had increased substantially, to
28 percent of mobile phone users and 48 percent of
smartphone users. In the 2013 survey, the prevalence
Mobile phone ownership is highest among non-
Hispanic whites and Hispanics at 88 and 89 percent, of mobile banking has continued to increase, reach-
respectively, relative to 80 percent for non-Hispanic ing 33 percent of mobile phone users and 51 percent
blacks. However, adoption of smartphones is higher of smartphone users (figure 1).
among minorities, as 73 percent of Hispanic mobile
phone users and 63 percent of non-Hispanic black Use of mobile payments has increased far less rapidly
mobile phone users own a smartphone, relative to than that of mobile banking. In 2011, 11 percent of
58 percent of non-Hispanic whites. mobile phone users and 23 percent of smartphone
users reported using mobile payments. In 2012, usage
of mobile payments had increased only slightly, to
2
The figures derived from the Board’s survey are nearly identical 15 percent of mobile phone users and 24 percent of
to the 91 percent mobile phone ownership rate and 61 percent
smartphone ownership rate reported by the Pew Research Cen- smartphone users. Mobile payments usage increased
ter in its June 2013 Smartphone Ownership—2013 Update, www among all mobile phone users from 2012 to 2013,
.pewinternet.org/files/old-media/Files/Reports/2013/PIP_ reaching 17 percent, but remained at 24 percent of
Smartphone_adoption_2013_PDF.pdf.
3 smartphone users. The higher rate among all mobile
While the majority of banks and mobile financial service pro-
viders offer apps for both Android and iOS devices, some apps phone users, but constant rate among smartphone
are only available for one platform. Among the operating sys- users, suggests that smartphone adoption substan-
tems utilized by smartphone users in the survey, Android is used
by 45 percent of respondents, Apple’s iOS by 44 percent of tially contributed to the increased use of mobile
respondents, and BlackBerry by 3 percent of respondents. payments.