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ICBA Payments Survey: Number of Community Banks Offering Mobile Payment Services on the Rise

Washington, D.C. (Nov. 12, 2013)—The number of community banks that offer mobile payments is increasing, according to a nationwide survey released today by the Independent Community Bankers of America®  (ICBA). The 2013 ICBA Community Bank Payments Survey, the latest edition of ICBA’s biennial survey, revealed that 37 percent of community banks offer mobile payments, an increase of 23 percent over 2011, and that another 43 percent intend to offer mobile payments to their customers by 2015.

“The 2013 ICBA Community Bank Payments Survey confirms what we are seeing anecdotally in the marketplace—that community banks are increasingly offering mobile banking services to meet the evolving needs of their customers and enhance overall customer service,” said Viveca Y. Ware, ICBA executive vice president, regulatory policy. The survey also reveals that community banks are increasingly seeing payments as a relationship-builder—something that is right in line with the community bank relationship lending model.”

Larger community banks are leading the way in mobile banking, with 54 percent of banks with $501 million or more in assets offering mobile payments. Community banks with $251 million to $500 million in assets are not far behind, with 46 percent offering mobile payments.

Community banks also see payments as a way to build lasting customer relationships. In fact, only 59 percent of community banks indicated that increasing profitability is one of their most important payments strategies. This is down from 70 percent in 2011. While 55 percent of community banks continue to see payments as a source of efficiency, a greater number now see payments as a way to improve customer service.  

“Community banks, by definition, are customer and community driven,” said Samuel Vallandingham, president and CEO of the First State Bank in Barboursville, W.Va., and chairman of ICBA’s Bank Operations and Payments Committee. “According to this year’s survey, most community banks set their bank’s strategic direction in payments by listening to their customers.”

Other key findings and trends from the 2013 ICBA Community Bank Payments Survey include:

  • The percentage of community banks experiencing payments revenue growth increased more than those that achieved revenue growth in 2011 (36 percent versus 31 percent) but remained well below the percentage of community banks that increased their payments revenue in 2009 (50 percent).

  • Increases in revenue are mostly driven by business payments products. Community banks with less than $100 million in assets were least likely to experience revenue increases this year and were most likely to experience a revenue decline.

  • Electronic person-to-person payments (P2P) are now offered by 40 percent of community banks, up from 27 percent in 2011. Another 28 percent of community banks planned to implement P2P in the next two years, with higher rates of planned deployment among larger institutions.

  • The implementation of consumer remote deposit capture (RDC) seems to have peaked among community banks overall. The results suggest that many banks have determined that the risks related to this product outweigh the rewards, while others seem to be waiting for the product to mature before making the decision to offer RDC to their customers.

  • Debit cards continue to be seen as essential to community banks’ customer relationships, with 99 percent rating them as important and 87 percent rating them as very important.

  • Nearly every bank surveyed was affected by debit card fraud losses, with 94 percent indicating they have suffered a monetary loss due to debit card fraud. The percentage of respondents reissuing debit cards as a result of these losses, however, was down to 84 percent in 2013, compared with 92 percent in 2011.

For more information, visit www.icba.org/paymentssurvey.

About ICBA
The Independent Community Bankers of America®, the nation’s voice for nearly 7,000 community banks of all sizes and charter types, is dedicated exclusively to representing the interests of the community banking industry and its membership through effective advocacy, best-in-class education and high-quality products and services. For more information, visit www.icba.org.

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