Understanding your customer is the key to success in personal banking.

For more than 20 years, Synovate's Customer Service Index (CSI) has quantified customers' experiences with their financial institutions in Canada across all key personal banking touch points, including ATMs, branch and online banking. Results are based on over 35,000 responses per year, collected quarterly. Detailed reports allow clients to benchmark their organization's performance against all key competitors and monitor progress versus efforts to enhance the customer experience.

Results from CSI generate the annual winners of the Synovate Best Banking Awards.

For more information about this study, please contact Adrian Murphy

Mobile banking could face hurdles in Canada

With more and more people buying smartphones, there are hopes that mobile banking could catch on in a big way in Canada. Indeed, a number of Canadian banks and credit unions have introduced mobile banking programs in recent months.

"On the move? Now your bank can be right there with you. Go mobile today!" reads one ad praising the merits of RBC Mobile Banking.

But if the experience with traditional telephone banking is anything to go by, there may be a tough road ahead before mobile banking does for Canadian banking what automated banking machines did in the 1980s.

Synovate research has found that only one-third of Canadian personal banking customers have ever used a financial institution's telephone banking service. And the numbers get worse when people are asked if they've used the service in the last six months: Only 17.6% of Canadian personal banking customers have used automated telephone banking during that period, compared with 19.5% in 2008 (source Synovate Customer Service Index, August 2009).

"Telephone banking usage has been declining for some time now," says Adrian Murphy, Vice President for Syndicated Research at Synovate Canada. "Compared with online banking, customers may perceive telephone banking to be more limited and time consuming as well as potentially less secure," he explains.

Unlike all other forms of banking in-branch, ATM, automated telephone and live telephone - online banking is the only major banking method that continues to gain in popularity. Online banking was used by 61.9% of personal banking customers during the six months ended August this year, up from 60% last year. "I suspect the broad functionality, convenience and interactivity of online banking are key elements in its growth," Murphy notes.

Advocates of mobile banking say its growth will be fueled by smartphones that can replicate the functionality of personal computers, thus allowing for online banking on the go. Smartphones are cell phones with software that allow users to browse the Internet, send e-mails and download files.

In a mid-August research report, RBC Dominion Securities analyst Mike Abramsky described the smartphone market as "huge, nascent and under-penetrated," and predicted the shift to smartphones will be "the next wave of computing." He forecast that smartphone penetration of the global handset market will rise from the current 15% to 35% over the next three years.

"Only the current economic downturn has curtailed both consumers' demand for mobile banking and banks' willingness to invest in it," concluded a report by IDC Financial Insights in the U.S.

As 3G and even 4G becomes more prevalent and customized banking apps get offered across the board it is easy to imagine that mobile banking will follow online banking with a steady increase in adoption.

Written by journalist Danny Kucharsky