Asia Pacific is leading the way in finance apps, with over 110bn sessions taking place in 2016, compared to Europe and US clocking in slightly over 50bn and 75bn respectively, according to an App Annie research report.
This might come as little surprise as consumers are now spending more time in app than ever, and set to spend over $139bn on app stores by 2021.
The surprising thing then, is the fact that finance apps are the fastest growing non-game category in APAC, according to Al Campa chief marketing officer, App Annie.
“Bigger than social, the only one faster than that is gaming. That’s surprising but it makes sense, if you think about where the world is with mobile phones, there’s 3bn mobile phones right now and that’s going to grow to 6bn in the next three years,” said Campa.
“You start to see phones being used for more basic everyday life transactions like banking. The trust level is now there with mobile banking, which maybe wasn’t there three to four years ago, where people were worried about the security of the transactions,” he added.
Finance apps might be sitting pretty on the rocket ship up, banks across the region have made different approaches to apps, from bundling all functionality into one app to having standalone apps for specific or combination of banking services.
This is in part due to the different levels of maturity across the region according to Campa.
“You see a mature market for example Australia, deregulated in terms of banking, you see Australia have the highest number of sessions per user, over 25, everyday that Australians use their app for banking, and their apps are very rich in what they can do, from checking balances to moving money to even investments,” said Campa.
“In less mature markets like China and South Korea, you see the apps are smaller in terms of what they can do, there are numerous apps to do what in Australia would be in one app, that’s partly due to maturity and partly due to regulatory reasons, regulations have restricted the ability to do online-based banking,” he added.
This differences also reflect in the age of the users, with Australia seeing mostly 13 to 24 year olds using finance apps, while Japan sees the opposite with the majority of users being 44 years old and above.
Financial technology (fintech) players have also made their mark, with over two-thirds of WeChat users having a bank account associated with their WeChat account according to App Annie’s research.
This has positioned WeChat as a potential AliPay competitor, and provides a glimpse into how fintech players can impact conventional banking businesses.
One of the key lessons for financial institutions in launching their own apps and increase customer stickiness then is in reducing friction. Doing that while allowing customers to securely log in will be key and there are new technologies that these institutions can latch on to according to Campa.
“The banks are trying to do is build really good apps with good customer experience, to engage in whatever service it might be, in the simplest and easiest way with minimal amount of friction,” said Campa.
“So if it is really tough to log in to something and really tough to do things like transactions, you’ll maybe try the app but never go back. Things like Touch ID, some companies are using retina or facial scans to recognise [customers] so you don’t have to type in passwords to log in.
“They make it easier to perform transactions, reducing friction and increasing adoption, it also has a cool factor,” he added.
Empowering users through financial advisory and providing visibility are also key lessons, as the online and offline converge according to Campa.
“Making investments is the next level, [in China], investment apps are making incredible growth, 318% in the last two years. This is a big area, the automating of financial and investment advice, do you trust it to a machine learning engine, is the money you’re paying to the stock broker or financial advisor worth it in the advice you’re getting,” said Campa.
Ultiamtely finance apps are now an irresistible force after gaining the trust of customers in APAC, with sessions skyrocketing past other regions.
“It’s kinda hit a tipping point where people are comfortable with it, they see other people using it, banks are reinforcing it and guaranteeing transactions if something happens, and that’s why its fuelling adoption,” said Campa.