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Bank Of America Mobile Banking Abridged

Solution Id Length Case Author Case Publisher
1994 520 Words (3 Pages) Sunil Gupta, Michael Norris Harvard Business School : 512082
This solution includes: A Word File A Word File

Mobile banking offers increased convenience of bank account access, transaction details, bill payment, and contactless transactions. Contactless transactions included making payments to merchants without having to signs a receipt or enter the PIN code on the card machine. It also allows customers to pay to a merchant, not in physical proximity.

Following questions are answered in this case study solution:

  1. What benefits does mobile banking provide to consumers? 

  2. Why haven’t many consumers adopted mobile banking yet? 

  3. What is BofA’s motivation to offer mobile banking to its customers? 

  4. What are the associated costs and risks to the bank? 

  5. What lessons can the bank learn from its online banking operations? 

  6. What are the costs and benefits of having customers migrate to online banking? 

  7. How is mobile technology likely to influence the banking industry in the future? 

  8. How should McDonald and Brown respond to the LOB managers’ request to include more functions in the bank’s mobile app?

Case Study Questions Answers

2. Why haven’t many consumers adopted mobile banking yet? 

The primary reasons are a lack of perceived value of mobile banking, distrust in the security of online transactions, and expense of data package on mobile. Some other, not widely prevalent reasons include hidden cost, dropped telecommunication connection, limitations of wireless plans, and resistance to the adoption of new technology. 

3. What is BofA’s motivation to offer mobile banking to its customers? 

Once a customer starts using online banking, they are unlikely to switch to another bank. Secondly, the rate of adoption of mobile phones is very high, which would help BofA to provide convenience, engage, and satisfy customers. Reduction in cost per transaction and calls to the helpline is also a motivator.   

4. What are the associated costs and risks to the bank? 

The addition of more features such as mortgage and credit card applications could slow down the application, and instead of convenience to the customer and a positive brand image, it could negatively affect user experience. 

Developing customized applications would increase opportunity costs more than the cost of the project because of reprioritizing bank resources.  

5. What lessons can the bank learn from its online banking operations? 

Online banking allows an additional advertisement channel for the bank.

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