Opportunities For Mobile 

Financial Services To Engage 

Underserved Consumers 

Qualitative Research Findings 

Susan Burhouse 

Benjamin Navarro 

Yazmin Osaki 

Division of Depositor and Consumer Protection 

Federal Deposit Insurance Corporation 

May 25, 2016 
4 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
1 

EXE CUTIVE SUMMAR Y
 

The FDIC recently conducted qualitative research on the potential for mobile financial services 

(MFS) to increase economic inclusion. This paper reports on the findings from this qualitative 

research with consumers and industry stakeholders and identifies a set of strategies for banks to 

consider that can better position them to meet underserved consumers’ needs.1 

The results of this research show that great potential exists for MFS to improve account 

sustainability by helping underserved consumers obtain more control over their funds and better 

manage their bank accounts. 

Consumers make trade-offs when selecting financial services or products based on a set of 

financial services needs that are important at a given time. The study identifies the following 

seven core financial services needs for underserved consumers: 

•	 Control over finances – Consumers want to know exactly when and why money is 

deposited and withdrawn from accounts; and they want to be certain about the terms 

and conditions of the product. 

•	 Access to money – Consumers expect financial providers to make their funds available 

quickly because they often need to use funds as soon as they are received to pay bills 

and make purchases. 

•	 Convenience – Consumers value features of a financial product or relationship that save 

time or effort when conducting transactions. 

•	 Affordability – Consumers are sensitive to the predictability and level of fees for account 

maintenance and everyday transactions, such as accessing cash. 

•	 Security – Consumers want protection from physical and electronic theft of funds or 

personal information. 

•	 Customer service – Consumers expect to have the ability to access live help through 

their preferred banking channel. 

•	 Long-term financial management – Consumers seek advice on money management or 

the availability of tools to meet financial goals (e.g., spending reports, savings trackers). 

Banks were perceived as strong in some areas, such as security and customer service, but weak 

in others, including control over finances and access to funds. Among study participants, banks 

were generally perceived to offer superior security, customer service, and long-term financial 

management, especially when compared to nonbank prepaid card providers. However, many 

felt financial institutions were not convenient because of limited operating hours or locations. 

Consumers also often felt that financial institutions did not afford them enough control over their 

finances or fast enough access to funds, noting a lack of clarity and consistency in timeframes for 

posting transactions and updating account information. 

Mobile banking helps meet consumer needs in areas where traditional banking is perceived to 

be weak. It improves the convenience of banking services, consumers’ control over finances, 

and in some cases the affordability of banking services. Some study participants reported that 

MFS alerts and monitoring tools have helped them reduce fees, better track their finances, and 

improve on-the-spot decision making. Mobile banking also increased their ability to keep records 

that can be easily accessed when disputes about payments arise. Mobile bill pay and peer-topeer (P2P) payments also help consumers manage payments conveniently and quickly. Some 

participants had experience with or expressed interest in using mobile features to help improve 

long-term financial management through tools that track account trends and products that 

encourage savings and build credit. Thus, MFS can potentially be used to grow consumer banking 

relationships. Challenges remain, though, to using MFS as an access point to banking, since many 

participants preferred to open bank accounts in person and are hesitant to open accounts using 

1 Underserved consumers are those whom the FDIC defines as either unbanked or underbanked. Unbanked 

households are those that do not have an account at an insured banking institution. Underbanked households have 

an account but also obtain financial services from nonbank alternative financial services (AFS) providers such as 

check cashers or payday lenders. 

1
their mobile phones. Further, financial and cultural obstacles to banking, such as lack of money 

and distrust of banks, remain firmly entrenched among certain customer segments and are not 

easily addressed by MFS in isolation. 

Banks can implement MFS in ways that better meet the needs of underserved consumers. 

As they continue to enhance and market their mobile banking features, banks will be better 

positioned to engage the underserved by considering opportunities for mobile banking to address 

the needs of these consumers. Underserved consumers repeatedly noted several opportunities 

for their financial providers to meet their needs more effectively. Though not a comprehensive 

list, several of the opportunities raised by consumers follow: 

•	 Increase consumer control over finances by improving access to timely account 

information 

• Post transactions in as close to real-time as possible and communicate more precise 

timing of when payments and deposits are expected to clear (as opposed to a 

range). 

•	 Clearly identify transactions not factored in the current available balance. 

•	 Expedite access to money 

•	 Clear mobile remote deposit capture (mRDC) deposits faster, while maintaining 

sound risk management practices. For example, offer mRDC with faster availability 

options in exchange for a reasonable fee. 

•	 Make banking more affordable through better account management 

•	 Promote the use of MFS as a tool to help consumers reduce unexpected fees. For 

example, low balance alerts or using MFS to conduct timely balance and transaction 

monitoring can help avoid overdraft or insufficient funds (NSF) fees. 

•	 Address real and perceived security shortfalls 

•	 Develop and communicate security measures to allay widespread fears about 

MFS, both real and perceived. Inform consumers about best practices they can 

implement to minimize MFS security risks, such as setting password protection on 

mobile phones and being mindful when using untrusted networks. 

•	 Increase awareness of mobile tools 

•	 Promote the use of MFS as a tool to help improve consumers’ control of their 

finances. Identify and target customer segments that might benefit from strategies 

to help them manage funds, reduce unanticipated fees, maintain minimum required 

balances, increase savings, or avoid having transactions declined. 

•	 Offer MFS set up as part of the account opening process and demonstrate available 

alerts and functions. 

•	 Encourage Long-Term Financial Management 

•	 Provide aggregate or trend account information that can be accessed through 

mobile tools to help consumers more effectively monitor progress towards fulfilling 

financial goals (e.g., spending, saving, budgeting). 

2 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
3 

I. INTRODUCTION
 

The FDIC is committed to increasing the participation of unbanked and underbanked households 

in the financial mainstream by ensuring that Americans have access to safe, affordable banking 

services.2 An inclusive financial system that serves the broadest possible set of consumers 

helps strengthen public confidence in mainstream banking, and ensures that consumers have 

opportunities to deposit funds securely, conduct financial transactions, accumulate savings, 

and access credit. In 2013, more than one in four households was unbanked or underbanked, 

obtaining some or all of their financial services outside of the mainstream banking system.3 

Recently the FDIC has been exploring ways in which mobile financial services (MFS) can help 

increase economic inclusion among unbanked and underbanked consumers, who this report 

will refer to collectively as underserved consumers. Mobile devices such as smartphones have 

emerged as a technology that has the potential to change the way consumers interact with banks, 

and banks are rapidly making MFS available to their customers. 

FDIC research has suggested that MFS may especially benefit underserved consumers. The FDIC 

National Survey of Unbanked and Underbanked Households found that three-quarters of all 

underbanked households have access to a smartphone, and more than one-third of underbanked 

households used mobile banking in the past year4

. In fact, underbanked households are more 

likely to have access to smartphones and to use mobile banking than fully banked households. 

In addition, a 2014 FDIC white paper concluded that MFS has the potential to be implemented 

in ways that address the specific financial needs of the underserved and help draw them 

more comprehensively into sustainable banking relationships, thus expanding the number of 

individuals who obtain financial services safely and securely.5 See Tables 1 and 2 in the Appendix 

for more detailed information about access to smartphones and mobile banking use. 

To gain a more in-depth understanding of the financial needs of underserved consumers 

and their perceptions of MFS in relation to these needs, the FDIC undertook a multi–phase 

qualitative research project as an extension of the survey research and white paper. This 

research project was designed to examine the potential for MFS to improve access to, sustain, 

and grow banking relationships for underserved consumers as well as to understand the factors 

limiting its potential. As part of this effort, the FDIC engaged underserved consumers in a series 

of focus groups. The FDIC then shared consumer impressions with financial services industry 

participants that develop, deploy and/or use MFS technology, including representatives of banks, 

credit unions, community groups, and technology service providers, to gather their reactions 

to some of the concerns and ideas arising from the consumer focus groups. This paper reports 

on the findings from the FDIC’s qualitative research with both consumers and other industry 

participants. 

The focus groups demonstrated that underserved consumers have diverse financial services 

preferences and needs and that MFS is well positioned to meet some of these needs. The 

results show great potential for MFS to improve account sustainability, in particular, by helping 

underserved consumers successfully manage and maintain bank accounts. Consumers reported 

that MFS helps to address weaknesses in traditional banking. Indeed, some focus group 

participants reported that MFS alerts and monitoring tools have helped them reduce fees, 

better track their finances, and improve on-the-spot decision making. Mobile bill pay and P2P 

payments also help consumers manage payments conveniently and quickly. Some participants 

had experience or expressed interest in using mobile features to help improve long-term financial 

management through tools that track account trends and products that encourage savings and 

build credit. Thus, MFS can potentially also be used to grow consumer banking relationships. 

2 Unbanked households are those that do not have an account at an insured banking institution. Underbanked 

households have an account but also obtain financial services from nonbank alternative financial services (AFS) 

providers such as check cashers or payday lenders. Fully banked households are those that have a bank account and 

do not use any nonbank AFS providers. 

3 2013 FDIC National Survey of Unbanked and Underbanked Households.
	 4 2015 FDIC National Survey of Unbanked and Underbanked Households (forthcoming October 2016).
	 5 “Assessing the Economic Inclusion Potential of Mobile Financial Services,” FDIC White Paper, June 2014.
	

3
However, MFS may not be the best or preferred solution for every identified need. In particular, 

challenges still exist to using MFS as an access point to banking, since many participants preferred 

to open bank accounts in person and are hesitant to open accounts using their mobile phones. 

Further, financial and cultural obstacles to banking, such as lack of money and distrust of banks, 

remain firmly entrenched among certain segments and are not easily addressed by MFS in 

isolation. 

The remainder of this report discusses the qualitative methods used; examines the core financial 

services needs of underserved consumers and the types of providers and products these 

consumers currently use to meet those needs; explores underserved consumers’ familiarity 

with and use of a range of MFS functions; and provides insights into consumers’ perceptions of 

MFS and how well it can meet their needs, relative to traditional banking channels. Consumer 

quotations from the focus groups are included throughout the report. In addition, reflections 

from financial providers are presented when relevant. Finally, the report identifies a set of 

strategies to better position financial institutions to meet the needs of underserved consumers to 

provide more opportunities for the underserved within the traditional banking system. 

4 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
5 

II. METHODS
	

From May to July 2015, the FDIC conducted consumer focus groups on the use of MFS among 

underserved consumers to gain a more in-depth understanding of its potential to increase 

the participation of these consumers in the financial mainstream.6 There were two rounds of 

consumer focus groups. The first round explored the topic at a high level, gathering information 

on consumers’ existing financial needs, the current ways in which they meet those needs, and 

consumers’ understanding and use of MFS in relation to these needs. Based on the results of this 

round, the FDIC selected specific MFS features for more in-depth discussion during the second 

round of consumer focus groups. The topics discussed in greater detail were account monitoring 

tools, bill pay, and peer-to-peer (P2P) payment tools. The main objective was to assess how 

various MFS features could improve access to banking, sustainability of accounts, and banking 

relationship growth. 

In total, across the two rounds of focus groups, eighteen were conducted in 3 metropolitan areas 

of different sizes. In the first round, eight total focus groups were conducted in Memphis, TN, and 

Los Angeles, CA, (including two Spanish language groups). In the second round, ten total focus 

groups were conducted in Kansas City, MO, and Los Angeles, CA, (including two Spanish language 

groups). 

All of the consumer focus groups targeted underserved consumers: those whom the FDIC 

defines as either unbanked or underbanked. All focus group participants owned smartphones. 

Previous FDIC research shows that three quarters of underbanked households have access to a 

smartphone, a higher share than the 71 percent of fully banked households with smartphone 

access. Focus groups included a greater representation from low- and moderate-income and 

younger consumers, relative to their population proportions, because these segments may 

represent the highest potential for MFS to improve economic inclusion. Participants were 

selected to ensure participation by Black, White and Latino consumers, and to include both male 

and female consumers. Both users and non-users of MFS were included. Some participants used 

bank-provided mobile technologies, while others, including some unbanked participants, used 

MFS from nonbank providers. Throughout the report, MFS refers broadly to services provided by 

banks or nonbanks or both, unless otherwise specified. 

In addition to consumer focus groups, the FDIC also conducted structured, in-depth interviews 

with industry executives about how financial institutions and related organizations are addressing 

mobile financial services and underserved consumers.7

 The interviews also gathered industry 

reaction to the consumer focus group research. The interviews were conducted by telephone 

between November 2015 through January 2016 with representatives from 11 financial services 

industry participants and consumer groups. 

Qualitative research, including focus groups and structured interviews, have inherent limitations 

and any findings reflected in this report should be considered with these limitations in mind. 

First, the samples were small, based on convenience sources, and selected among consumers 

and providers who were readily available for participation. Further, to ensure a lively discussion 

on specific topics, participants were not selected at random; rather, those who met preselected 

criteria were chosen over others. Together, these limitations affect the degree to which results 

can be generalized across the entire population of underserved consumers. Moreover, consumer 

comments were based on the consumers’ perceptions, which do not always accurately reflect 

the current policies of banks or standards in the financial industry. In some instances, consumers 

may have strong opinions formed from misunderstood facts. Researchers did not correct these 

misunderstandings during data collection but instead aimed to gain insight into how consumers 

currently view the financial industry. 

6 The FDIC contracted with a market research firm to conduct the focus groups. 7 The FDIC contracted with a market research firm to conduct the structured interviews. 

5
 

III. U N DER SER VED C ON SUMER S ’
	 FINANCIAL SERVICES NEEDS 

To assess how mobile financial services can help financial institutions appeal to and benefit 

the underserved, the early stages of qualitative research were devoted to documenting and 

understanding consumers’ core financial services needs and the products and services they use 

to meet those needs. 

During focus groups, the FDIC observed that underserved consumers expressed many common 

core needs when managing their finances. Ultimately, across all 18 focus groups, seven general 

dimensions of financial needs emerged. This section of the report will discuss those core needs as 

well as the financial products and services that consumers use to address them. 

A. Core Financial Needs 

1. Control 

An overwhelming majority of study participants seek a sense of control in managing their 

finances and prefer products and providers that enable them to achieve this feeling. In essence, 

these participants want to feel that they, not their financial provider, are in charge of their 

finances. Specifically, control refers to knowing exactly when and why money is deposited and 

withdrawn from accounts. This includes a desire for transactions to be processed quickly, without 

unexpected fees. 

“It‘s so much easier for me to just go when I’m getting some gas, just to go ahead 

and pick up that money order at the gas station for rent or electricity or gas 

or water, whatever, and I’m done with it right then and there. I don‘t have to 

worry about oh, did this automatic debit come out of my account and, if so, what 

time did it come out, is it gonna clear before this fee clears or before this deposit 

makes it in.” –Unbanked MFS User 

“I’ll give you a good example with my sister. She wrote a check for the kids to 

buy some candy for my sister. She deposited her check in that—nine o’clock that 

morning. Evidently the check went through that night or it went in the bank 

then bounced. She put the money in the account. They still charged her the $35 

overdraft but the money—on her record it shows that the money was deposited 

on the 10th and she put the money in on the 10th. I guess the time was off, 

but they still charged her the $35 overdraft but the money was in the bank.” 

–Unbanked MFS Non-User 

Two important aspects of financial control are the consumer’s ability to obtain proof or record 

of transactions to be used when disputes arise and the ability to quickly identify any erroneous 

overcharges. Finally, some participants noted the importance of predictable and transparent 

account terms and conditions. 

“You know, with a standard bank account or say they don’t charge you, they 

don’t assess those fees for the first three to six months. You have the account but 

then after that they’re twice as big, you know, or what have you, or the minimum 

balance doubles after a certain amount of time.” –Unbanked MFS User 

2. Access to Money 

Universally, underserved consumers in the study want their deposited money to be available right 

away and do not want it subject to holds. This need stems from a desire for the ability to use 

funds as soon as they are received to pay bills and make purchases. 

“I have to make it there between a certain window of opportunity to have access 

to my money or do certain things with it. And I just prefer to keep it liquid around 

me.” –Unbanked MFS User 

6 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
7 

“The holds drive me nuts. On some of these checks they put three-, five-day holds 

on. It’s very frustrating. I’m going through one right now.” –Underbanked MFS 

User 

Consumers also want a quick resolution of account problems (such as unauthorized 

transactions on an account or suspected fraud) that would otherwise lead to 

suspension of access to funds or to the account itself. 

“You have to wait for them to put the money back in your account. It’s your money. 

It should go back right away just like they took it right away.” –Underbanked MFS 

User 

3. Convenience 

Nearly all study participants expect that financial services be convenient. Convenience means 

different things to different consumers, but often they reference those features of a financial 

product or relationship that save time or effort when conducting transactions. For example, some 

consumers prefer locations close to their work or home, while others want operating hours that 

cater to a variety of work schedules. For some consumers, online or mobile transactions are most 

convenient. 

“It’s closer to my home. And it’s just convenient to just walk in.” –Unbanked MFS 

User 

“You see, for me, since I get paid in cash it’s easier to spend cash. I’m not having 

to withdraw from a bank, I’m not having to deposit into a bank. It is more of a 

risk keeping it, you know, out of a bank, but I guess that’s the risk I take for the 

convenience.” –Unbanked MFS User 

4. Affordability 

For most consumers in the study, affordability is a prominent consideration in their day-to-day 

lives. They wish to minimize or avoid fees for account maintenance and everyday transactions, 

such as accessing cash. When fees are assessed, underserved consumers value predictability in 

fee amounts and timing and often want to find ways to minimize fees that could reasonably be 

avoided. For example, some underserved consumers described their displeasure with paying 

overdraft and NSF fees for transactions that occurred just hours before a large deposit. 

“Because you could take money out and the balance would not necessarily reflect 

what you just took out. And so basically at 16 years old I had—I got over $1,000 

worth of fees from the bank.” –Underbanked MFS Non-User 

“I don’t think [the total fees related to alternative financial services] exceeds $20 

a month for me. I’ve gotten in way worse situations with fees with banks in the 

past. I mean significantly more than $20.”–Unbanked MFS User 

“Like if they gave you 24 hours. I’m gonna run to the bank and put some money 

in, I’m good, that would be great, but they don’t.” –Underbanked MFS User 

5. Security 

Many consumers seek preventative measures against physical and electronic theft of funds 

as well as protection against identity theft, data breaches, and unauthorized account access. 

Consumers want security while maintaining privacy, which they recognize can be a difficult 

balance. The research found that for the underserved segment, “security” broadly refers to 

protection from various real and perceived threats. 

“The biggest thing about that, not only will they take your money, but a person 

can take your name and have a whole little house and everything else in a whole 

other state.” –Unbanked MFS Non-User 

7
6. Customer Service 

When participants discuss their need for quality customer service, they typically mention three 

factors. They want customer service representatives to be available through channels and at 

times that are convenient for the consumer, although these preferences may vary. Consumers 

also want reasonable wait times to connect with a representative. 

“If I’ve got a problem with my bank account, my money, I want to talk to somebody 

face-to-face, and over the phone.” –Underbanked MFS Non-User 

“I would like it where I could call someone 24 hours a day, though. Because 

sometimes you have to wait until the next business day—they’ll keep you stressed 

out all night long.” –Underbanked MFS User 

7. Long-Term Financial Management 

Finally, a few consumers are interested in long-term financial management support. This may 

include financial planning advice and access to longer-term investment and credit products 

(mortgages, auto loans, etc.). 

“And going back to more options, too, like you [were] saying with being able to 

get a loan... [banks] offer [investments], retirement plans, credit cards to help 

your credit.” –Underbanked MFS User 

This may also refer to the availability of personal financial management tools. Some underserved 

consumers noted they had experience with visual tools and interactive graphics that made their 

income and spending behaviors easier to understand. These types of tools were sometimes found 

in bank apps, prepaid card apps, or third-party apps and websites. 

“I do like where on my prepaid card it tells me how much I spend on transportation; 

how much I spend—I can also see where I’m spending too much money, like at 

restaurants.” –Underbanked MFS Non-User 

See Appendix Table 3 for a summary of all seven underserved consumer core financial services 

needs. 

B. Financial Providers and Services Used 

Almost all consumers in the FDIC focus groups, by design, had used non-bank financial services. 

Many of the consumers used non-bank prepaid cards, while others went to retailers that 

offer money orders and other products, or AFS providers. Some of the consumer focus group 

participants had also used traditional depository institutions, such as banks and credit unions. 

Understanding the reasons consumers choose different providers at different times can help 

inform bank strategies for using MFS to complement their other offerings and better meet 

consumers’ needs. 

Underserved consumers have varying preferences; thus, they will make different decisions and 

trade-offs. Consumers choose providers based on the financial needs a provider fulfills and 

the salience of a given need at a given time. They frequently make trade-offs to meet their 

most pressing needs and may switch between providers as often as necessary. For example, a 

consumer with an urgent need for funds availability may be willing to pay a substantial fee to 

cash a paycheck every month, even though he or she may prioritize affordability under most 

other circumstances. That decision may ultimately drive whether a consumer decides to form a 

relationship with a bank or an AFS provider. 

Underserved consumers stated that they use a variety of financial products to manage their dayto-day finances. These products include cash, checks, money orders, debit cards, prepaid cards, 

and P2P payments. Each product has benefits and drawbacks, and, as with financial providers, 

most consumers use a mix of products to meet their needs. The section below includes consumer 

opinions on each product type. 

8 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
9 

“I guess it’s just the situation. Like I use the cards to pay bills and I use my cash 

to have fun I guess. I just use it for two different things.”–Underbanked MFS User 

1. Cash 

Consumers recognize that cash is free to use, widely accepted, provides immediate spending 

power (since no holds are associated with cash), and limits overspending, since consumers 

cannot spend more than they have. 

“There are no fees when you pay cash. When you pay cash, they don’t charge 

you a $3 fee. You’re paying your bill for the amount that it is.” –Underbanked 

MFS Non-User 

“You have more control when your money is in your hand.” –Unbanked MFS NonUser 

In addition, unlike other transaction products, consumers are not at risk of identity theft when 

they use cash. Cash, like money orders, also allows consumers to avoid disclosing any potential 

personal financial information that might be compromised. 

“If you go into a place... where you are going to all these different stores, you can 

just pay cash and you don’t have to worry about someone taking your credit card 

number or debit card number.” –Underbanked MFS User 

Using cash and other fast payments like money orders was also considered “simple,” as the 

transaction was immediately settled. 

On the other hand, consumers noted that cash requires physical effort to use, that large amounts 

of cash draw unwanted attention and may result in theft with little recourse, and that cash does 

not provide the same recordkeeping benefits of electronic alternatives. 

2. Checks 

Underserved consumers mentioned that checks are becoming a less common part of their lives 

with the introduction of direct deposit and other forms of electronic payments. 

“I never get a check anymore. I don’t see checks, except my grandfather pays the 

lawn guy with a check.” –Unbanked MFS Non-User 

For some consumers, however, checks are easy and convenient to use, particularly compared to 

retail bill payment alternatives. 

“I don’t have to go to the bank, I just write a check, and then the bills are sent off. 

I don’t have to go stand in line.” –Underbanked MFS Non-User 

Underserved consumers mentioned certain drawbacks of paper checks, including that they 

typically cost money, require a waiting period to clear, and are not universally accepted by 

merchants. Finally, participants noted the unpredictability of relying on somebody else to cash or 

deposit a check they had written in a timely fashion. In some scenarios, this type of uncertainty 

led to consumers accidently overdrawing their accounts. 

“I forget about checks. Like ten days later I’m like, crap.” –Underbanked MFS User 

“And then with checks, I’ll write a check, and then I forget to check my bank 

account, and it bounces... $35 charge.” –Underbanked MFS Non-User 

In other cases, consumers are able to meet their bill pay obligations by taking advantage of the 

delays in check clearing. 

“With money orders, I have to have cash. And I use checks because sometimes I 

don’t have the money at that time, then you have five days to pay the rest of the 

rent, because they don’t take out the money immediately.” –(Spanish translation) 

Underbanked MFS Non-User 

9
3. Money Orders 

Some underserved consumers use money orders because certain payees, such as landlords, 

required this form of payment. Others favor using money orders because they cannot result in 

overdrafts or insufficient funds penalties like a check. 

“You don’t have to worry about it bouncing. If it gets lost, a lot of times you can 

go and stop it.” –Underbanked MFS User 

Moreover, money orders enhance feelings of control because the recipient cannot collect more 

than is intended. Also, using money orders produces robust and traceable documentation, and 

they can be easily replaced if lost or stolen. 

“They can’t take more than what it says on the [money order]. Whatever is there 

is what they’re going to get.” –Underbanked MFS User 

Underserved consumers noted, however, that money orders are relatively expensive and require 

time and effort to use. 

4. Debit Cards 

For underserved consumers, debit cards are intrinsically linked to checking accounts, and 

their opinions of one heavily influence the other. For example, some focus group participants 

expressed a general distrust of banks and thus shy away from using bank debit cards, even if they 

have access to one. 

In some cases, fear that their account information could be stolen affects how or whether they 

will use their debit card. 

“I use my debit card in stores if I’m just buying small items. But I use it as a charge 

card so they can’t get my debit number.” –Underbanked MFS Non-User 

For other consumers, debit cards help them budget their money and keep better track of 

expenses. 

“I like using debit cards because I can always track my expenses and finances. 

Sometimes when you use cash, you don’t pay attention to how quickly it goes or 

everything that you spend it on. I like the fact that I’m not walking around with 

money in my pocket, and the fact that I don’t spend as fast.” –Unbanked MFS 

User 

Also, many underserved consumers recognize that unauthorized or fraudulent transactions on 

bank debit cards are likely to be satisfactorily resolved. Some noted that resolution may take 

longer than they would prefer, but generally this group was confident that their funds would be 

returned, eventually. 

“If you deal with a bank, and your money [is taken] off the card, it’s nine times 

out of ten you’re going to get your money back.” –Underbanked MFS Non-User 

5. Prepaid Cards 

Prepaid cards were perceived to be more affordable than a bank debit card (largely due to 

the inability to overdraft most of these cards and the lack of associated overdraft fees). Some 

consumers, even those with bank accounts, prefer using prepaid cards to avoid overdrafts. 

“Banks just don’t do right. I mean, you’ll get a fee for something that you didn’t 

know was coming out and then you have to go through hoops to get money back. 

And I just don’t like dealing with all of that. If it’s on a prepaid card it’s either 

there or it’s not, and that’s cut and dry.” –Underbanked MFS User 

10 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
11 

Several underserved consumers discussed using prepaid cards as a part of a broader strategy for 

maintaining a budget or controlling spending. 

“I use [prepaid cards] just because I want to have my bills separate. Like she said, 

you can transfer [between a bank account and prepaid card] anyway. It doesn’t 

matter. You have more control.” –Underbanked MFS User 

“Like if you travel, going out of town, you know you want to have $500 to go out 

of town. You can transfer $500 to that card without using your personal card.” 

–Underbanked MFS User 

In addition, some participants felt that prepaid cards, compared to checking accounts, provide 

faster access to money through direct deposit, although this perception is likely flawed. 

Finally, consumers expressed more comfort with the security of prepaid cards compared to other 

tools mainly due to their belief that a compromised prepaid card account would not risk any 

funds held elsewhere, such as in a bank account. 

“The prepaid card is not tied to my main source of income. It’s just tied to what I 

want to have access to.” –Underbanked MFS User 

“I don’t want my bank information out, the prepaid card is actually very good for 

that because then I can just pay with that [instead of a bank card].” –Underbanked 

MFS User 

Conversely, consumers expressed concerns that their funds would not be insured the same way 

as bank funds, that using the cards is limited in other ways (such as inability to pay for services 

with a hold charge, such as a rental car), and that prepaid card companies provide relatively 

inefficient customer service compared with banks. 

6. Peer–to–Peer (P2P) Payment Systems 

P2P systems, both electronic and retail, are seen as easy to use and require minimal personal 

information. Underserved consumers noted that some online P2P services can be used to hold 

deposits as effectively as a checking account and with comparable customer service and error 

resolution policies. Consumers also highlighted the fact that transfers and payments are cleared 

and posted immediately to their P2P account. 

“There’s really no point for me to go to the bank, if everybody’s paying me [with 

a P2P provider] for the most part. I can just move what I’m going to use for 

personal to personal [from my business account]. It’s just easy, and when I had a 

bank account, I wasn’t using it, because all the money was in the [P2P provider]. I 

would have to go to the bank to deposit, so I’m like, no, just forget it.” –Unbanked 

MFS User 

“[P2P provider], well, to me, it almost functions like a bank.” –Unbanked MFS 

User 

“So it’s just like, I send it right now. Like I can literally send it, and we can be right 

there, about to buy something, and I say ding, and she can swipe and get it, or 

whatever. It’s quick.” –Unbanked MFS User 

Consumers are concerned, however, with the perceived lack of federal deposit insurance and, in 

the case of purely electronic P2P systems, with the lack of physical locations. 

11
“See, your money is not insured with a [P2P provider], but your money’s insured 

with a bank, to a certain degree.” –Underbanked MFS Non-User 

“For instance if you have [an account with a large bank] or something, you can 

find one in every corner of the United States, right? But when you have things 

like a prepaid or like a [P2P] account and stuff like that, let’s say you want to 

pay your bill and it’s like your water and light bill from here from LA and you’re 

at home visiting and you’re not from LA, and then you go—they don’t have the 

California check cashing store. They don’t have certain things.” –Underbanked 

MFS Non-User 

For a complete description of consumer perceptions of the benefits and drawbacks of several of 

these everyday financial instruments, see Appendix Table 4. 

12 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
13 

IV. FAMILIARITY WITH AN D USE
	 OF MF S 

Following discussions of core financial needs and financial product usage, the consumer research 

focused on underserved consumers’ familiarity with and perceptions of MFS, both generally and 

with regard to specific MFS tools. Many underserved consumers are aware of MFS, although 

awareness is lower among unbanked consumers. 

A. Learning about MFS 

Underserved consumers who actually had experience using MFS stated that they learned about 

the capability to conduct financial transactions on their mobile phones in different ways. Many 

consumers learned about these services directly from financial providers. Providers informed 

consumers about apps and mobile capabilities through advertisements, emails, provider 

websites, paper statements, customer service representatives, and television commercials. 

Others became aware of mobile financial services from bank branch employees, either while 

conducting transactions or during the account-opening process. Bank employees also played a 

role in educating some customers on how to set up and use the services; they also offered these 

customers ongoing assistance. 

“[We learned from] the bank telling us... ‘Now we have an app.’ So it’s like, ‘OK, I’ll 

download the app,’ and you just start using that more than you use the website, 

because it’s—It pretty much has, generally, almost all the features that you would 

have on the website—a small version of it.” –Underbanked MFS User 

“It seems like we’re being pushed more to apps, because banks are going the way 

where less face-to-face is the way to push everybody. Even our teller machines... 

were shut down.” –Underbanked MFS User 

Traditional word of mouth was another important way consumers became aware of mobile 

financial tools. Indeed, many consumers initially learned about these tools by watching their 

friends and family use them. These personal sources helped spur adoption because consumers 

felt more comfortable asking questions of people they know and felt they could turn to those 

people if they encountered problems. 

“[I learned] through my daughter. Because I used to bother her a lot, so she 

taught me.” –Underbanked MFS User 

“When I first got a smartphone, I was like ‘oh wow’ it opened up a whole new 

world. My brother had one before ahead of me and he was like ‘now you can do 

this, you can do that’.” –Underbanked MFS User 

Consumers most comfortable with technology may have found out about financial apps by 

searching for them proactively. Because these consumers were more interested in and had 

greater faith in the benefits of technology, they sought new apps that might be beneficial to 

them. 

“You just go look around on the app, see what they offer, what can you check, 

what information is there.” –Unbanked MFS User 

13
 

B. Initial Engagement with MFS 

Consumers perceived the initial setup of mobile financial services as easy and straightforward. 

Even non-users believed that a hypothetical setup would be fairly easy and correctly guessed the 

steps necessary to enable MFS features on their phones. 

“Easy. You... download the app, it takes five seconds. Then you’ll just create an 

account and... when you put in the number of the card...their system connects to 

the app.” –Unbanked MFS User 

Some financial institutions were proactive in using branches to help consumers set up mobile 

banking access through “tablet stations” or by providing free Wi-Fi to facilitate the download of 

the bank app. 

“I guess one of the things, just even visibility, one of the things we’ve done 

recently is we opened a branch, a new branch. And we have a tablet station so 

that we kind of give members visibility that, you know, we support several mobile 

devices. So, as you walk in, it’s very visible and it’s got a, like, touchscreen kiosk 

beside it that walks members through how to use mobile deposit and how to pay 

bills online and that sort of thing.” –Financial Institution 

Consumers had different experiences initiating MFS capabilities for the first time and had varying 

expectations about the process. Some consumers wanted and expected to be able to complete 

the setup on their mobile device, and some MFS users reported that they had done so. In some 

cases, though, it was not possible to enroll in MFS without setting up an online banking account 

and using a computer to enable and set up certain MFS features. For example, consumers needed 

an online account to configure mobile alerts with some providers. 

“Yeah. Once you set up on your computer you can do it on your phone, but if you 

just download the app first for [this bank] you can’t send money to somebody 

else just between your accounts.” –Underbanked MFS User 

While some consumers in the study expressed frustration at having to go online to set up MFS, 

no one mentioned that this step prevented them from using these services. Some financial 

institutions in the study highlighted their mobile banking system’s ability to set up access without 

a computer, either by using just the phone or by obtaining a code from customer service. 

“Well, today you can actually, if all you have is a phone, you can register directly 

on mobile for the first time.” –Financial Institution 

“At first I could only set it up through a desktop or laptop computer. Then I could 

access through my phone. But now they have it set up to where you can always 

set it up from your phone now.” –Underbanked MFS User 

Some consumers preferred to set up MFS on a computer, for a variety of reasons, among them: 

the computer screen is larger and can better display more detailed information; the computer 

keyboard is easier to use than a phone touchscreen for inputting information and the computer is 

more secure, according to consumer perceptions. 

Several underbanked consumers said they would prefer to have a representative from the bank 

set everything up for them to ensure it was done properly and securely. This is especially true of 

those who were not currently using MFS. 

“Because you have to go to the bank to set up an account; there’s no way 

around that. The person who sets up your account should ask you specifically: 

‘Do you plan to download an app?’ Yes. Ok, then they can make that available.” 

–Unbanked MFS Non-User 

For many, the use of mobile financial services grew from basic to more advanced features over 

time. It was not uncommon for consumers to start using mobile financial services to simply check 

account balances before progressing to more complicated processes, such as alerts, bill pay, and 

transfer features, as they became more familiar and comfortable with the technology. 

14 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
15 

C. Meeting Consumers’ Needs With MFS 

MFS, as currently offered in the market, address many of the core consumer financial services 

needs discussed above, including convenience, affordability, long-term financial management, 

and control in the form of access to information. This research explores ways in which specific 

MFS features meet, or fail to meet, consumer financial needs, and also identifies areas for 

potential improvement to benefit underserved consumers. These improvements may be 

applicable to other banking channels, but are particularly relevant to MFS because of the 

anytime, anyplace nature of that channel. While financial providers typically noted that their MFS 

strategies are designed to be broadly accessible rather than targeted to any particular customer 

segment, several MFS features seem well-suited to address the needs of the underserved, 

nonetheless. 

1. Account Management Tools 

One of the ways in which MFS can most directly meet underserved consumer needs is by 

providing account management tools and functions. Checking balances and transaction histories 

on mobile devices is the most popular mobile financial service, and nearly all underserved 

consumers who said they used MFS take advantage of this capability. Many consumers check 

their finances on their phones as part of their daily routine. Some described how they regularly 

check their accounts in the mornings when they wake up, or in the evenings before bed. Other 

consumers check their accounts in response to certain trigger events. For example, when out 

shopping, they may check to see if they have enough money to cover a purchase they are 

considering. Or, they might check after making a purchase to confirm that the transaction went 

through. Consumers find that access to information from their phones is convenient and helpful 

in monitoring their accounts, informing spending decisions, and providing them with a high level 

of control over their finances. Even those who do not use MFS think these tools are appealing, 

and feel that mobile account monitoring would be the most beneficial aspect of MFS. 

“That’s gotta be like the most convenient thing if I can be able to keep track of TV 

[bills], health insurance [bills], the whole nine yards, just right there in one place 

and then sign in and go.” –Underbanked MFS User 

“You can be in the line about to buy something. Turn around and enter your 

information, like she said, and listen to the balance, do you have enough. But 

when you’re in line, it’s like ch–ch–ch, and you’ve got your balance, OK, I’ve got 

enough.” –Unbanked MFS User 

“Almost every day, because if I know some money is supposed to come in on the 

first or the third, when I wake up that morning, the first thing I do is check and 

make sure it came in. I’ve had to make some purchases to [start a business]. So 

I check to see if the money has gone out to cover that so I know that I can go 

ahead and move forward because I know that that’s on its way. So a lot of stuff 

I’m doing daily. And then sometimes, just to make sure, I’ve done this, this, this, 

and this. What do I have left?” –Unbanked MFS User 

The primary concern that some consumers expressed about mobile account monitoring is that 

balance and account information is not always updated quickly enough to meet their needs. 

Consumers reported mixed experiences. While many said that their financial providers do display 

updated information, others said this was not the case. These consumers were frustrated with 

transactions showing as “pending” and account balances not reflecting recent transactions 

quickly enough. 

‘The gap in time between my perceived or, I guess, my personal perception of 

when money should be taken out and when it’s actually taken out of my account 

is the bane of my life. And I understand it’s not entirely up to my financial 

institution; it’s also up to individual vendors and things like that. But the gap in 

between pending and all of this is just—I don’t know about you guys, but it’s one 

of the biggest frustrations with modern banking.” –Underbanked MFS User 

15
“There have been times when for example if I go get gas, it won’t post for two 

days... So if I’m expecting in my mind I have around... [a certain] amount of 

money, and then I go in and it’s less, and then I have to go check what happened 

and then things that I thought posted two, three days ago are just posting.” – 

Underbanked MFS Non-User 

Traditionally, institutions process transactions in batches at specific times of day, so transactions 

are not necessarily reflected in account balances immediately as they occur. Some types of 

transactions, such as traditional check clearing and ACH, can require a day or more to clear. 

Many of the financial institution representatives contacted for this study acknowledged the 

need to process transactions more quickly and realize that consumers often expect to see 

their account balances and information updated immediately when they make a transaction. 

Several institutions have enhanced their processing systems to post some transactions in real 

time, rather than according to a batch process, providing consumers with more up-to-date 

balance information. Some consumers in the focus groups noticed that their institutions were 

updating information more quickly, but they pointed out that the posting speed of transactions 

is dependent not only on the bank but also on the merchant accepting payment. Although not 

all providers post transactions in real time, some are able to provide specific information to 

consumers about when they will clear, which is also useful to those who are eager to understand 

exactly when money will enter and leave their account. Ongoing efforts to modernize the 

payment system may eventually result in the proliferation of more real-time account monitoring 

tools. 

“When you submit [an mRDC] deposit we will tell you, your funds will be available 

on December 6th. So there is no question when it will be available. We said 

December 6th, and that’s when money will be available.” –Financial Institution 

2. Alerts 

Alerts are also popular among underserved MFS users, and their use is widespread. In contrast 

to account monitoring tools, which consumers access whenever they choose, alerts are proactive 

communications that arrive automatically through texts and emails at regular times, or when 

certain account activities occur. For example, many consumers receive alerts about their 

balances. These may be regular alerts with balance information that come at specific times, such 

as daily or weekly intervals, or whenever the balance drops below a specified amount. These 

types of alerts have benefited some consumers, especially in helping them avoid fees. Knowing 

when balances are low can help consumers avoid both low balance and overdraft fees, improving 

account affordability. 

Consumers also like to be alerted when payments or deposits are posted to their account. These 

alerts help consumers monitor their account balance and identify unauthorized transactions. To 

this end, consumers also value fraud alerts when the provider notices suspicious account activity. 

Consumers can receive alerts through email and text, and many reported receiving both types. 

Consumers see texts as beneficial because they feel that texts capture their attention in a way 

that an email does not. Email alerts, on the other hand, are seen as advantageous because they 

can provide more detailed information and are seen as a better way to document account history. 

Some consumers mentioned a few concerns with alerts. Some are wary of alerts becoming 

too numerous or intrusive, or coming at inconvenient times. Notably, while consumers see a 

great deal of value in receiving texts and emails containing the types of information they have 

requested, many consumers do not want alerts to be used for other purposes, such as marketing 

or other unsolicited communications from the provider. Also, if consumers rely heavily on alerts 

as a primary way of communicating with their bank, they may have relatively few opportunities to 

learn about other bank products. From a financial provider’s perspective, it may be more difficult 

to promote new products and grow banking relationships under such circumstances. 

16 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
17 

“I do have alerts and stuff that keep me more on an accurate path. Because I have 

three kids really young. So it’s always nice and convenient to get my alert, to say 

‘Hey, you’re under $1,000. This is where you’re at.’ It’s perfect. I could be feeding 

a child and starting to get one bathed, and just look real quick at my phone and 

see where my account is at.” –Underbanked MFS User 

Alerts are a common feature of mobile banking offerings, and some banks offer highly 

customizable alerts. Conversations with industry providers suggest that providers are interested 

in assessing the content, frequency, and characteristics of alerts that would increase consumer 

adoption of these tools. 

3. Mobile Bill Pay and P2P Services 

Mobile bill pay and P2P services are also useful features in meeting consumer needs, a key 

benefit being the convenience of making payments from any location at any time. Many 

consumers like the fact that the payments can be automated, reducing the likelihood of late or 

skipped payments, although some feel the need to control the initiation of payments and are 

wary of payment automation through bill pay tools. 

“With that whole setting out the payment thing—like you want to set up a 

payment for Friday for your electric bill for it to automatically come out. What 

if there was a problem with your paycheck and it didn’t hit on Friday, and they 

automatically pulled that money out? Would they take into consideration that 

that money wasn’t deposited, and you’re going to get a bunch of overdraft fees 

from that preplanned payment going through?” –Unbanked MFS User 

In addition, these services create a record of transactions that consumers feel they can refer to 

if a dispute arises about a bill payment. Consumers can access the transaction history showing 

cleared payments as well as email or text alerts showing when the transaction was completed, 

both of which enhance their sense of control. 

“Somebody always magically says that they didn’t get paid. So, you know, I 

know I can take a screen shot and send it over and let them know it’s paid.” – 

Underbanked MFS User 

Consumers noted, however, that MFS tools are not sufficient when bills must be paid 

immediately. Instead, consumers use the payee’s mobile site or app or make payments in person 

when a payment due date is fast approaching. In particular, consumers noted that when they 

need to pay a bill that is due right away, they often make the payment on the payee’s website 

because their accounts are credited more quickly if the transaction is made directly to the payee 

rather than through a financial institution. This is because payees typically credit accounts once 

the consumer submits his or her payment information, even if the funds have not yet cleared. 

When processed though a financial provider, consumers must wait until the funds have actually 

been transferred, which adds time to the transaction and can result in late fees, undermining 

consumers’ sense of control. 

“For the most part, you know it’s going to take a couple of days before [a payee] 

acknowledge[s] that they received that payment so... I’m always going right up 

against whatever day it is that I need to pay it.” –Underbanked MFS User 

“I can go to [the payee’s] website. I can go to another mobile app that will also 

help me with the bill payment et cetera that is completely free, that is completely 

upfront and it won’t give me the headache and the anxiety that the bank bill 

payment will. And that’s why. There’s just way too many options there for me to 

even bother with it.” –Underbanked MFS Non-User 

17
A somewhat less commonly available and used MFS feature is P2P payments, typically money 

transfers to family and friends. Conversations with financial institution representatives suggest 

that banks are currently thinking about ways to provide and enhance these services. 

“Person-to-person payments right now is a really, really hot space. It’s something 

that everybody is paying a lot of attention to. There is a lot of activity. We’re 

certainly very tuned in and thinking lots of interesting thoughts about person-toperson payments and how that continues to scale and become more ubiquitous 

over time so that it is truly anybody can send money to anybody.”–Financial 

Institution 

Consumers who do use P2P tools often use nonbank apps and services, though a few described 

using P2P tools offered by financial institutions. Consumers have high expectations regarding 

the speed of P2P services and feel that these transactions, because they are electronic, should 

be instantly debited and credited. Users with experience making P2P payments are generally 

satisfied with the speed of the transactions, and find that mobile tools are easier to use than 

wiring money and faster than sending a check. Consumers who use these services to send money 

also like that they are required to provide only minimal information about the payee, such as 

an email address or mobile phone number. Any additional information that is required by the 

provider to process the payment is then provided by the payee. 

Some peer-to-peer transfer services specialize in sending money overseas. These services often 

market themselves as having the best exchange rates or the lowest fees with the purpose of 

attracting consumers who frequently move money between different countries. Spanish-speaking 

consumers spoke about sending money home to their families, but the majority use retail money 

transmitter services, bank branches, brick and mortar-based nonbanks, and prepaid cards and 

are less familiar with exclusively mobile-based remittance platforms. Retail money transmitters 

are popular because they provide quick transfers, sometimes in minutes, as well as what are 

perceived to be competitive exchange rates. 

“For example, if I want to send money to Mexico, the bank [charges more] for 

sending that money. When you do it elsewhere, they can get it in ten minutes, 

and they give me more for that money than if I go to the bank. They charge me 

more and take more... They charge more for the transfer and the bank charges 

are higher, so the person receives less.” –Unbanked MFS User 

4. Mobile Remote Deposit Capture 

Mobile remote deposit capture, or mRDC, allows consumers to deposit physical checks by 

capturing an image on their phone and sending it to their financial institution. These offerings 

are becoming increasingly widespread, as banks continue to explore ways to manage the 

risks associated with this mobile feature. Fraud risk remains a concern for banks, along with 

unintentional misuse, such as when a consumer accidently deposits the same check twice. 

“One of the mechanisms we have for managing risk is capping the size of the 

checks and the cumulative numbers and amounts of checks that customers can 

deposit through mobile deposit to make sure that we can manage the velocity of 

any sort of fraudulent behavior or that kind of stuff.” –Financial Institution 

While many underserved consumers are aware of this feature, few said that they had experience 

using it. The main advantage of mRDC is the time saved by not having to travel to the bank or 

ATM to deposit a check. The length of time it takes for the check to be credited to an account is 

the main driver that determines whether consumers find the feature useful. Consumers generally 

expect that mRDC deposits should be processed quickly, perhaps even faster than deposits made 

through other channels, such as at the ATM. In practice, mRDC hold times differ, but some banks 

impose longer holds for mRDC deposits than deposits made at an ATM or with a bank teller. 

Users’ experience with mRDC is mixed; some said they received funds relatively quickly, while 

others reported long waits to access their deposited funds. In rare cases, financial institutions 

guarantee immediate access to mRDC deposits in exchange for a fee, similar to their in branch 

check-cashing programs. 

18 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
19 

 

“I picked a paycheck up after 5:00, so obviously I couldn’t go into the bank to go 

put it into my account. So just sitting at home, I can just take a picture of it, and 

then deposit it in my account. So that was really helpful.” –Underbanked MFS 

User 

“At first I was really excited about it, but then it didn’t clear for a week so I was 

mad. I was like, I should have just gone to a teller and deposited it.” –Underbanked 

MFS User 

The study identified some notable barriers to the adoption of mRDC. Some underserved 

consumers do not see sufficient value in the feature either because they receive direct deposit 

in lieu of regular paper checks, or because they already have methods for accessing money given 

to them through paper checks, such as nonbank check cashers. Consumers without experience 

using mRDC tend to like the concept but have questions about how it functions, while others 

are unwilling to try the feature for fear it would expose them to security risks. In many cases, 

these risks are associated with fears of having financial account information “stolen” during the 

electronic transmission of the check image. 

“Once this is done, where does the image of the check go?”–Unbanked MFS NonUser 

“There’s so many cheats in the world. How is it to keep [mRDC fraudsters] from 

running, from cheating me... So these guys, crooks are constantly thinking 

about taking your money, just as much as you are trying to keep it secure.” 

–Underbanked MFS User 

“Well, if I got a check for $4,000, I’m not taking a picture, and I’m not retaining 

the check. I’m taking a copy of it, or putting it in my files, and going to the bank 

with it. If you receive something that high, though, you want to just absolutely 

make sure... [to] hand deliver it.” –Underbanked MFS User 

5. Mobile Account Opening 

A small number of study participants said they had opened an account online, and many of these 

accounts were with financial institutions that do not have physical locations. The majority of 

underserved consumers did not express interest in opening accounts on their mobile phone or 

find it impractical to do so. Consumers prefer the security and personalized service of speaking 

face-to-face with a representative when opening a new account. There is, however, some interest 

among consumers in using a mobile phone to set up a new account if the consumer already has 

an account with that same financial provider. 

“OK, so when I’ve opened up checking accounts before, I’ve had to show my 

Social. How would we do that? Because I definitely wouldn’t put my Social on my 

phone.” –Underbanked MFS User 

“The [phone] screen itself [...] is so small. I want to be able to read everything. 

What if I’m missing something over here in this corner because my phone isn’t 

showing me the whole page? Or I have to enlarge it and then I miss something 

on the other side. I don’t know. It seems having the whole screen there and being 

able to read it instead of shifting it around on your phone seems like a—seems 

more secure to me.” –Underbanked MFS User 

“I don’t have concerns about [mobile account opening], but usually you have 

questions and it’s easier to talk to somebody.” –Underbanked MFS User 

Table 1 summarizes the benefits of important MFS features, according to consumers who 

participated in the focus groups, and the relationship of those features to their underlying 

financial needs. 

19
 

Table 1. Ways MFS Helps Consumers Meet Core Financial Services Needs 

MFS Feature Benefits

Consumer Needs 

Addressed 

Checking 

Balance and 

Transaction 

History 

• Provides access to account 

information anytime and 

anywhere 

• Saves time/trips to providers 

• Helps budget 

• Helps inform on the spot spending 

decisions 

Control, 

Convenience, 

Long–Term 

Financial 

Management 

Alerts 

• Provides access to account 

transaction and balance information 

• Helps consumers avoid fees 

• Helps monitor accounts for fraud 

Control, 

Convenience, 

Affordability, 

Security 

Bill Pay 

• Ensures timely payment 

• Save money over other methods that 

carry varying convenience fees 

• Saves time/trips to providers 

• Provides ability to pay bills anytime 

and anywhere 

Control, 

Convenience, 

Affordability, 

Peer–to– 

Peer 

Transfers 

• Enables immediate settling of 

personal debts 

• Faster than other methods 

• Saves time/trips to providers 

Control, 

Convenience, 

Mobile 

Remote 

Deposit 

Capture 

• Helps deposit money 

faster 

• Saves time/trips to 

providers 

Control, 

Convenience, 

Access to 

Money 

20 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
21 

 

V. MOBILE B AN K IN G RELATIVE T O
	 TRADITION AL B AN K IN G 

As mobile banking becomes more widely available, consumers will have yet another channel 

through which they can interact with banks, conduct transactions, and obtain financial services. 

To assess whether and how mobile banking might ultimately improve consumer banking 

experiences and relationships, it is useful to understand how the availability of MFS might 

change the way consumers interact with banks, and how specific MFS functions are more or less 

successful than other banking channels in meeting consumer core financial needs. 

A. Impact of Mobile Banking on Traditional Banking Channels 

MFS is an additional channel that consumers may use to replace or supplement traditional 

banking methods, such as teller banking, online banking, ATM banking, and telephone banking. 

Financial professionals expressed mixed opinions about whether and how mobile banking has 

affected consumer use of traditional banking channels. Some noticed a decrease in Internet and 

phone interactions, as mobile banking has become consumers’ preferred channel. 

“If you look at our calls that we receive, if you look at the telephone banking 

usage, it’s directly correlated, it seems to be directly correlated with the increase 

in mobile banking usage and decline in telephone banking, for example.” 

–Financial Institution 

Other bank representatives, however, generally do not feel that mobile banking is contributing 

to a decrease in in-person branch transactions and the use of other traditional channels. Rather, 

they believe mobile banking activity encourages consumers to engage more with the bank and to 

interact with their accounts more frequently, for more reasons, and through more channels. 

“I think what we’ve seen, mobile adoption as being...at least up to this point... 

almost entirely additive in terms of channel behavior. We have not seen 

customers flooding out of other channels as they adopt mobile and use mobile 

to the exclusion of the others. We’ve seen them just increase the intensity of 

their relationship and their interactions...and the frequency of their interactions... 

with us through mobile devices while they’ve continued to retain contact with the 

other channels.” –Financial Institution 

“We kind of expected to see some cannibalization from branch check cashing. And 

we really haven’t seen that. Customers are pretty channel-loyal. And if anything, 

we’d see more of an incremental customer base coming in through our mobile 

channel, as well as our ATM, as well as we add additional functionality through 

there.” –Financial Institution 

B. Advantages and Disadvantages of Mobile Banking in Meeting Consumer Financial 

Needs 

Both MFS and traditional, non-mobile banking methods can meet many consumer needs, 

but MFS has certain advantages and disadvantages compared to non-mobile channels. The 

advantages specific to MFS can help address areas of weakness among traditional channels. 

While the research reveals that not all underserved consumers agree on the benefits and 

drawbacks of MFS, consumers generally believe that bank MFS has particular strengths in the 

areas of control, convenience, affordability, and long-term financial planning. 

Security and customer service are seen as weaknesses of MFS; however, opportunities exist for 

financial providers to improve MFS in these areas and to address the concerns that underserved 

consumers shared. Concerns about security among current MFS users, for example, are clearly 

not strong enough to impede adoption. For MFS non-users, however, improving or better 

communicating existing security safeguards and enhancing customer service may help increase 

adoption. 

21
 

 

22 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 

Figure 1: Banks’ Ability to Address Consumer Financial Services Needs with MFS, 

Relative to Traditional Methods

M o bi le 

F i n a n c ia l 

S e r v ic e s 

C o n tr o l 

C o n v e n i e n c e 

A ff o r d a bi l i ty 

L o n g -Te r m 

F i n a n c i a l 

Ma n a ge m e n t 

A c c e s s to 

Mo n e y 

S e c u r ity 

C u s to m e r 

S e r v i c e 

Blue = Strong Gray= Weak 

1. Control – MFS Is Seen as Superior to Traditional Channels 

Study participants expressed frustration about the perceived lack of control over their bank 

account funds. Unexpected fees, changing terms and conditions, and lengthy transaction 

processing times create uncertainty about these funds, and make it more complicated for 

consumers to juggle incoming and outgoing payments and ensure that the correct charges and 

fees are applied. Many indicated a preference for cash, money orders, or prepaid cards because 

transactions made with those products are completed instantly. 

Although consumers often stated that traditional banking does not provide them with enough 

control, MFS significantly increases the access to account information for underserved 

consumers, which directly addresses this weakness. Mobile tools allow consumers to check 

balance and transaction history at any time with minimal interruption to other activities. 

“It’s just the sheer convenience—keeping yourself informed on your finances. 

If you ever got to a point where you got pretty lax, and it’s like ‘Oh, I haven’t 

checked my balance in, maybe, two or three days,’ but you have been spending 

in those two or three days, it’s nice to know that you’ll get an alert saying ‘Hey, 

your balance is below this point.’ Or you set yourself a threshold in spending. It’s 

just nice to know that you will always be aware of these things.” –Underbanked 

MFS User 

“Easier to establish records, too, because it will send me confirmation texts or 

confirmation emails, and that just made it so much easier to say, like I said, if a 

mistake occurs, and mistakes do occur, I have something to back up what I did 

and when.” –Unbanked MFS User 

With easy access to account information, consumers have a clearer understanding of when 

payments and deposits are processed. Also, some MFS users reported gaining better control of 

their account by spending more judiciously and, in turn, avoiding certain fees. 
23 

“Because, like I said, I can go into the grocery store and know exactly how much 

I can spend, instead of being up there and get embarrassed because something 

else came out that I forgot about—a $20 something, or overdraft fees. I could 

always look at my bank account; make sure I’m not overspending. Or a check that 

I sent through. I could see that it’s pending in my account. If I’m $10 short, I can 

hurry up and transfer funds. It’s just—It’s saved me money, and it also saved me 

time.” –Underbanked MFS User 

A few MFS users, however, mentioned that having access to account information on the go can 

cause them to spend more, when they learn that money is available in the account. 

“Say if you’re out shopping, you see this watch or something you want to buy, 

you’re not real sure, like, if I’ve got a [enough] to get it. And I just go on my phone, 

oh, yeah, I can get it, you know.” –Underbanked MFS User 

Financial institution representatives in the study reported positive feedback from consumers 

regarding the greater control experienced with mobile banking. 

“I’ve never seen another banking product where the customers use the word 

“love” to describe it as often as we see when reading some of these comments. 

People love being able to be in control over their financial lives.” –Financial 

Institution 

MFS is not able to completely address all control issues pointed out by study participants. Some 

of these issues depend on underlying bank policies, such as the lack of transparency of fees or 

delays in bank transaction processing and posting. Some consumers recognize that many things 

that delay transaction posting are beyond the control of financial institutions and instead depend 

on merchant processing practices or limitations of various payment networks. 

2. Convenience – MFS Is Seen as Superior to Traditional Channels 

MFS also offers a significant advantage in convenience. Traditional banking is often perceived as 

inconvenient. Consumers noted that they do not always have time to visit the bank during the 

hours it is open, and do not like the hassle and expense of driving to the branch. 

“So most people don’t know if you go to a little supermarket, they’ll cash your 

check for you. All you gotta do is show your driver’s license to get you in the 

computer. I use that as a last resort, because some banks close on a holiday and 

you cannot control when you get paid because it falls on a certain date. But we 

do know the holiday will fall on certain days of the month, and if the banks are 

closed, what do you do then? So you have to have a backup.” –Underbanked MFS 

Non-User 

Underserved consumers reported looking for ways to save time and reduce spending 

unnecessary effort in their lives, and mobile financial services are uniquely suited to solve this 

problem. Checking account balances and transaction histories can be accessed with a few taps 

on a mobile device, requiring significantly less time and effort than using an automated phone 

system, driving to a physical location, or logging on to a computer. Further, users can pay bills and 

transfer money instantly from a device that is almost always on hand. Underserved consumers 

find mobile financial services to be more compatible with their lifestyles than other methods of 

financial management. 

“Before, you had to wait to get the bank statement to see what you had spent on. 

But now it is much more accessible.” –(Spanish translation) Underbanked MFS 

User 

“It seems to me that unless you’re changing it frequently, you’re just tapping your 

thumb. Boom, boom, boom, you’re done. That’s it. It’s over with, then. Like I say, 

if you want to do it at 3:00 in the afternoon, you don’t have to wonder if the office 

is closed.” –Unbanked MFS User 

23
“I have to call in between their times. And then having to wait and listen for 

the system to go through, and sometimes it would be put in your card number, 

sometimes it’s put in your social security number. It’s a lot. [With MFS] I can just 

click, click, click and it’s all there on my phone.” –Unbanked MFS User 

“Don’t have to deal with anybody else. Just do it yourself. Quicker. Don’t have to 

leave the house.” –Unbanked MFS User 

3. Affordability – MFS Is Seen as Superior to Traditional Channels 

Many consumers feel banks are unaffordable, reporting negative experiences with bank fees 

that they find to be too high or unpredictable. While mobile financial services offer no direct 

cost savings, many consumers believe these tools help them save money. Access to account and 

transaction information through a mobile device helps underserved consumers avoid overdraft 

and low balance fees. When consumers can keep a closer watch over their money, they are more 

likely to know when they are in danger of a fee and are thus more likely to take action to avoid it, 

if they have the means to do so. 

“I feel a little less hateful when I’m not getting fees all the time, you know, and 

I think it makes a big difference banking on the phone for getting the fees.” – 

Underbanked MFS User 

4. Long-Term Financial Management – MFS Is Seen as Superior to Traditional 

Channels 

Consumers feel that banks are well-positioned to help them with personal financial management 

and long-term planning. Some said that banks are better than nonbank providers at developing 

long-term financial relationships with consumers, and that banks can help them build credit and 

access other products and services. 

“For me, I’d like to buy a house, so when you have a relationship with a bank 

it kind of shows stability and continues all of that towards buying a house.” – 

Unbanked MFS User 

“For me, having a bank account is as backup. It is never going to get lost and it 

helps when you need a loan. It speaks well or badly of you.” –(Spanish translation) 

Underbanked MFS Non-User 

“[I use a checking account] just if I need it for [extra money] for something maybe, 

money that I actually forget is there, it’s there if I need it.” –Underbanked MFS 

User 

Mobile financial services have considerable potential to enhance personal financial management 

tools and help consumers plan for long-term financial success. Consumers who adopt mobile 

financial services quickly make it a habit to check financial apps daily. This gives providers 

an opportunity to provide more detailed information to consumers that can help them with 

long-term financial goals, even if underserved consumers are not currently focused on such 

milestones. 

Although still rare, some financial providers offer consumers mobile tools that help them 

understand income and spending patterns. These budgeting and planning tools often offer visuals 

and give consumers a quick, uncomplicated view of their finances. 

Banks may also have an opportunity to use mobile tools to help grow or deepen their 

relationships with consumers who interact with the bank more frequently and may wish to 

learn about and use additional bank products and services. This may be challenging, though, 

because many consumers noted that they do not wish to hear about new products and special 

offers through the mobile app. So, for financial institutions to grow long-term relationships with 

consumers who increasingly interact with the bank through the mobile channel, they will need 

to explore the most effective ways of sharing advice or information about new products and 

services. 

24 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
25 

“When I’m in the app I just want to do what I’m there to do. I don’t want to be 

bothered with ads or offers.” –Underbanked MFS User 

5. Access to Money – MFS Is Seen as Comparable to Traditional Channels 

Consumers are often dissatisfied with banks’ ability to provide fast access to their money. Indeed, 

this is seen as one of the greatest weaknesses of traditional banks. Even though some consumers 

may expect quicker posting times and faster access to deposited money when using MFS, these 

tools are generally not able to change the speed of the underlying transactions. Hold times— 

the biggest barrier consumers face in accessing their funds—are dictated by financial service 

providers as well as certain merchants. Mobile financial services do not change these dynamics. 

These services may present an advantage by allowing consumers to deposit funds without having 

to visit a branch or pay a bill without having to mail a check, but they cannot offer access to cash 

and mRDC deposits often require more processing time than traditional check deposits. Thus, 

mobile financial services currently have little impact on satisfying this consumer need. 

6. Security – MFS Is Seen as Inferior to Traditional Channels 

Many consumers seem comfortable with the level of security provided by traditional banking. 

Consumers are aware of FDIC deposit insurance and feel it is an important reason why bank 

accounts are safer than other alternatives, such as prepaid cards. In general, consumers feel 

confident that if funds were missing from their account, banks would eventually credit the funds 

back. While consumers acknowledge that it might be a hassle for them to go through the process 

of resolving an error or fraudulent activity, they feel their money is protected in a bank account 

and that banks are the safest financial provider. 

“I guess I dropped [my debit card]. Anyway, somebody end up using it. I mean, it 

took forever. I went through a lot to get that money back on my card and literally 

had to write to the bank. Oh, I was so mad. And I was at work when all this 

happened. I had to verify all this stuff.” –Underbanked MFS Non-User 

Despite the sense that banks are safer than other financial providers, underserved consumers 

perceive that mobile financial services expose them to greater risk of fraud, “hacking”, or 

unauthorized account access than other banking channels, including online banking. Among 

consumers who do not use MFS, security concerns are one of the main reasons they have stayed 

away from this technology; even current MFS users often worry about security. 

“A cell phone is just a computer; it can be hacked, and you can lose everything, 

which is why I don’t bank on a cell. I don’t do anything on a cell phone.” – 

Unbanked MFS Non-User 

“How anything you put on the Internet is on there forever. It never goes away. 

Even if you think it’s deleted, it’s not deleted.” –Underbanked MFS Non-User 

“I would be worried if I lost my phone they’d have access to all my banking 

information. If I lost my phone, you have access to all my banking.” –Underbanked 

MFS Non-User 

“And then sometimes it’ll say loading depending on the signal like what you were 

saying. And then what if it charges you two times a $150 ’cause it’s loading and 

loading and loading, it’s like when you make your car payment online, it says 

please don’t refresh your button ’cause you will get charged two times. Do they 

do that automatically or is that a possibility? Obviously like he said, if something 

happens and you just lose your signal temporarily, you’re on 3G instead of 4G and 

you get overdraft fees with your bank ’cause you only have exactly 150 bucks.” 

–Underbanked MFS Non-User 

In practice, these risks may not be as great as consumers believe, but the perception is very real. 

The combination of a lack of understanding of mobile technology and widely publicized data 

breaches of seemingly secure systems has left consumers wary about online fraud. Consumers 

are also concerned about risks that may arise in the future if current security measures are 

25
circumvented. Some consumers are sophisticated enough to know what encryption and 

other security protocols to look for, but most lack the knowledge to understand when an MFS 

transaction presents a meaningful risk. Among consumers, there is a widespread awareness that 

they should be cautious about using MFS over public or unsecured Wi-Fi. 

7. Customer Service – MFS Is Seen as Inferior to Traditional Channels 

Customer service was perceived to be another strength of traditional banking. Bank customer 

service staff is viewed much more positively than staff of other providers, especially those of 

prepaid cards. Many consumers feel that bank staff is generally more interested in helping them 

resolve issues than nonbank provider staff. They particularly value the ability to reach a live 

person when needed, either at the branch or on the phone. However, underserved consumers 

do not think that MFS offers responsive customer service that meets this same standard. Mobile 

based services are seen as a way for consumers to serve themselves. Due to this perception, 

consumers expect to use mobile tools autonomously and without assistance. When assistance 

is needed, the bar for fast and efficient resolution is higher because of the expectation that MFS 

should accomplish tasks quickly and with minimal effort. Therefore, consumers expect immediate 

support over the phone or via email, text, or chat, but MFS does not always deliver that. 

“It would be nice if you could reply and have it actually go somewhere so you 

didn’t have to log in. Like if you had a question about something.” –Underbanked 

MFS User 

Table 2. MFS Relative to Traditional Banking Channels

Consumer Need 

Consumer Perception

Traditional banking 

channels 

MFS relative to 

other channels 

Long–Term Financial Management Very Strong Superior 

Control Weak Superior 

Convenience Weak Superior 

Affordability Weak Superior 

Security Strong Inferior 

Customer Service Strong Inferior 

Access to Money Very Weak Similar 

26 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
27 

VI. C ON CL USION S AN D
 TAK E A W AY S 

Mobile financial services meet many of the core financial services needs of underserved 

consumers, especially in areas where traditional banking channels may be perceived to be less 

successful. The FDIC’s qualitative research reveals that MFS can encourage the sustainability of 

banking relationships for the underserved, but that potential is more limited for growing banking 

relationships and promoting access at the moment. 

Underserved consumers make tradeoffs when selecting financial services based on certain 

financial needs: control over their finances, access to funds, convenience, affordability, security, 

customer service, and ability to engage in long-term financial management. Many study 

participants feel that traditional banking does not provide the level of control, access to funds, 

affordability, and convenience they need. Mobile banking is perceived to better meet consumer 

needs in some of these areas of weakness. 

MFS improves the value of banking services for many consumers by enhancing the control, 

convenience, and, in some cases, even the affordability of having a bank account. Mobile banking 

users in the study were vocal about the ways that MFS increased their awareness of available 

account balances and helped them better understand the timing of when funds leave and enter 

their accounts. Mobile banking also provides underserved consumers the ability to monitor 

charges and fees, such as overdraft, and, in some cases, even avoid them. Mobile banking was 

also described as a convenient recordkeeping tool that can be easily accessed when disputes 

about payments arise. This type of control over managing funds is important for all consumers 

but particularly for underserved consumers who often have less leeway in their budgets. 

In many ways, MFS is already working quite well to improve banking experiences. One important 

opportunity lies in raising awareness about current offerings. Banks, financial educators, and 

other stakeholders can help consumers understand the available features and their advantages. 

Specifically, these stakeholders may consider developing messages that recognize the financial 

needs of these consumers and highlight the ways that mobile tools address these needs, 

indirectly or directly. 

Some concerns and misgivings about banking that persist in the minds of underserved consumers 

fall outside the scope of mobile banking. Many issues related to access to funds would require 

policy changes by banks and merchants, and modifications to the payments system that span the 

entirety of the banking system. Other obstacles that stand in the way of underserved consumers 

opening and maintaining bank accounts, such as lack of money or the absence of required 

identification, are not easily or directly addressed by mobile technology alone. Some consumers 

are averse to or uninterested in technology, and no realistic changes can be made to MFS 

offerings that will make them appealing to such consumers. 

In focus groups, underserved consumers verbalized several opportunities for financial providers 

to better meet their needs. Several of those strategies follow: 

•	 Increase consumer control over finances by improving access to timely account 

information 

• Post transactions in as close to real-time as possible and communicate more precise 

timing of when payments and deposits are expected to clear (as opposed to a 

range). 

•	 Clearly identify transactions not factored in the current available balance. 

•	 Expedite access to money 

•	 Clear mobile remote deposit capture (mRDC) deposits faster, while maintaining 

sound risk management practices. For example, offer mRDC with faster availability 

options in exchange for a reasonable fee. 

27
•	 Make banking more affordable through better account management 

•	 Promote the use of MFS as a tool to help consumers reduce unexpected fees. For 

example, low balance alerts or using MFS to conduct timely balance and transaction 

monitoring can help avoid overdraft or insufficient funds (NSF) fees. 

•	 Address real and perceived security shortfalls 

•	 Develop and communicate security measures to allay widespread fears about 

MFS, both real and perceived. Inform consumers about best practices they can 

implement to minimize MFS security risks, such as setting password protection on 

mobile phones and being mindful when using untrusted networks. 

•	 Increase awareness of mobile tools 

•	 Promote the use of MFS as a tool to help improve consumers’ control of their 

finances. Identify and target customer segments that might benefit from strategies 

to help them manage funds, reduce unanticipated fees, maintain minimum required 

balances, increase savings, or avoid having transactions declined. 

•	 Offer MFS set up as part of the account opening process and demonstrate available 

alerts and functions. 

•	 Encourage Long-Term Financial Management 

•	 Provide aggregate or trend account information that can be accessed through 

mobile tools to help consumers more effectively monitor progress towards fulfilling 

financial goals (e.g., spending, saving, budgeting). 

28 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
APPEN DIX
	

Table 1. Percent of Unbanked, Underbanked, and Fully Banked Households that Have Access to a 

Smartphone in 2015
 

Household Characteristic All 

Households Unbanked Underbanked Fully banked 

All 67.1 42.9 75.5 71.1 

Race or Ethnicity 

Black 63.5 43.6 73.3 70.9 

Hispanic 66.3 43.7 78.6 72.3 

Non-Hispanic Whites 67.3 41.2 74.3 70.4 

Other 74.0 43.8 83.6 78.7 

Age 

Age 24 or younger 82.5 63.6 90.7 87.7 

Age 25-34 84.0 56.6 90.0 90.6 

Age 35-44 80.9 53.5 86.2 88.3 

Age 45-54 75.4 37.7 78.2 82.8 

Age 55-64 63.9 22.3 66.2 70.3 

Age 65 or older 38.2 9.3 43.1 41.0 

Household Income 

Less than $15,000 43.9 39.5 57.7 42.7 

Between $15K and $30K 50.6 44.6 67.5 48.8 

Between $30K and $50K 64.6 49.5 77.1 65.2 

Between $50K and $75K 73.9 50.6 84.2 75.7 

$75,000 or more 84.1 44.5 88.5 87.7 

Source: 2015 FDIC National Survey of Unbanked and Underbanked Households (forthcoming October 2016). 

29
Table 2. Percent of Underbanked and Fully Banked Households that Used Mobile Banking in the 

Past 12 Months
 

Household Characteristic All Households Underbanked Fully banked 

All 31.9 35.7 31.0 

Race or Ethnicity 

Black 33.0 35.0 31.9 

Hispanic 34.2 34.2 33.8 

Non–Hispanic Whites 31.2 36.2 30.3 

Other 33.9 38.0 33.0 

Age 

Age 24 or younger 51.6 55.5 49.6 

Age 25–34 53.3 54.2 53.5 

Age 35–44 47.7 46.0 48.8 

Age 45–54 34.1 31.0 35.2 

Age 55–64 22.0 21.5 22.2 

Age 65 or older 9.2 10.8 8.9 

Household Income 

Less than $15,000 19.0 22.1 17.4 

Between $15K and $30K 19.6 27.2 16.6 

Between $30K and $50K 27.1 34.9 24.4 

Between $50K and $75K 34.6 42.8 32.9 

$75,000 or more 43.2 49.6 42.2

 Source: 2015 FDIC National Survey of Unbanked and Underbanked Households (forthcoming October 2016).

 Note: Based on banked households that accessed an account in the past 12 months. 

30 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings 
Table 3. Summary of Underserved Consumer Core Financial Services Needs 

Consumer Need Dimensions of Need 

Control 

• Knowing exactly when and why money is deposited and made 

available, and withdrawn from accounts 

• Confidence that transactions are processed quickly 

• Absence of unexpected fees 

• Choice in payment methods 

• Ease of long–term record keeping 

Access to 

Money 

• Access to funds as soon as they are received by financial provider 

• Short hold times from financial provider 

• Short hold times from merchants 

• Quick resolution of account problems (such as suspected fraud) that 

lead to suspension of account access 

• Quick return of money debited from accounts in error 

Convenience 

• Saves time or effort 

• Financial providers have locations close to work or home 

• Financial providers have hours outside of normal business hours 

• Access to online and mobile tools 

Affordability

• Low/no fees for account maintenance, individual transactions, check 

cashing, money order, bill paying, deposits, cash withdrawal, speaking 

with a customer service agent 

• Predictability in fees 

• Help minimizing “avoidable” fees 

Security 

• Broad term used for protection from threats 

• Safety against theft, both physically and digitally 

• Protection against identity theft, data breaches and unauthorized 

account access 

• Privacy 

• Safeguards against financial institution failure or mistakes 

Customer 

Service 

• Representatives available through consumers’ preferred channel 

(varies by consumer) 

• Representative available at convenient time to consumer (varies by 

consumer) 

• Lack of excessive wait times to connect with representative 

Long-Term 

Financial 

Management 

• Advice on longer-term financial planning 

• Access to personal financial management tools 

• Access to longer-term credit products (mortgage, auto loans, etc.) 

• Access to investment products 

31
Table 4. Summary of Consumer Perceptions of the Benefits and Drawbacks of Everyday 

Financial Products

 Product Benefits Drawbacks 

Cash • Widely accepted 

• Quick access to money and information 

about funds 

• Limits overspending (can only spend cash 

on hand) 

• No risk of identity theft 

• Easier to spend 

• Large amounts draw attention 

• Must physically go to get cash or pay 

in cash 

• Lack of records 

• Can be lost or stolen with little 

recourse 

Checks • Easy and convenient way of payment • Costs money to purchase checks 

• Takes time to reach recipient 

• Not universally accepted 

• Can have long hold time 

• Can be a delay if payee does not 

deposit immediately 

• Checks can bounce 

Money 

Orders 

• Widely accepted 

• No threat of bouncing a money order 

• Payee cannot take more than expected as 

payment 

• Creates a record and is traceable 

• Can be replaced if lost or stolen 

• Fees to use 

• Must physically go to pick up money 

order 

• Cost to cash out if no longer needed 

Debit Cards Debit cards are intrinsically linked to banks in consumers’ minds. Their perceptions of debit 

card transactions are tied to their opinions of bank checking accounts. 

Prepaid 

Cards 

• Perceived lower fees than bank accounts 

• Funds cannot be overdrawn/no overdraft 

fees 

• Perceived faster and easier access to money 

• Bank account numbers not used in 

transactions making it safer from identity 

theft 

• Can be used when customers prefer not to 

disclose bank account numbers 

• Funds not insured the same way as 

bank funds 

• Cannot be used with vendors that 

require additional holds (hotels, rental 

cars, etc.) 

• Inadequate customer service 

Peer– 

to–Peer 

Payments 

• Easy to use 

• Focused on mobile technology 

• Can hold money like a bank account 

• Minimal information needed for peer–to– 

peer transfers 

• Funds not insured the same way as 

bank funds 

• Some consumers not comfortable 

with technology and lack of physical 

locations 

32 | Opportunities for Mobile Financial Services to Engage Underserved Consumers Qualitative Research Findings