with Jeff Wray

It is safe to say that online and mobile banking have hit mainstream. Today, more than half of all adults with a bank account in France, Germany, Italy, Netherlands, Spain, Sweden, and the UK use banking services — which we define as information requests, transactions, or alert delivery — on their PCs, tablets, or mobile phones. The uptake of tablets and smartphones gives banks an opportunity to engage their customers deeply across platforms. Our recently published Forrester Research Digital Banking Forecast, 2013 To 2018 (EU-7) explores how each Internet-connected device will drive future online and mobile banking adoption across seven key European markets.

The forecast identifies some key trends in the European digital banking market.

1. Mobile banking adoption continues its sturdy growth. As recently as 2009, mobile banking activity was negligible, representing fewer than 5% of all adults with accounts. Adoption has risen nearly fourfold since and will continue to grow at double-digit compound annual growth rates through 2018. However, consumer concerns about device security will restrain growth: In all the European countries we track other than Italy and Spain, consumers are more than twice as likely to cite security concerns as a reason for not using mobile banking than for not using PC/tablet online banking.

2. Mobile banking users are becoming increasingly sophisticated. While the vast majority of early mobile banking usage came via SMS services, mobile Internet adoption is today, and will remain, the critical lever for mobile banking growth. In 2013, nearly three of every four European mobile banking users engaged with their banks via mobile websites or applications. Today’s mobile bankers also use more advanced services: Nearly half conduct transactions such as funds transfers, rather than simply checking account information or signing up to receive low balance alerts.

3. Users are twice as likely to bank on their tablets as on their mobiles. The uptake of banking activities is much higher among tablet owners than among mobile owners today; however, the total number of mobile bankers far outstrips that of tablet bankers due to device adoption trends. With tablet ownership more than tripling by 2018, this will begin to reverse: In 2016, we forecast that more consumers will bank on their tablets than on mobile phones in every European country except France.

Mobiles and tablets offer banks a variety of benefits but in different ways. While widespread mobile and smartphone adoption presents banks with a large opportunity to engage consumers today, surging tablet ownership rates over the next few years will demand a robust tablet banking platform as well. However, neither platform will cannibalize the other, as consumers will want to engage across multiple devices. Companies need to realize how customers move between channels during complex sales and service interactions. As my colleague Cathy Graeber says, “The next generation of digital banking will identify when human assistance is needed and help customers start a process in one channel and finish in another, gracefully passing information between the channels.”