In our recently-released Mobile Finance Report, we focused on the innovation and transformation that mobile has brought to the banking world. MENA (Middle East and North Africa) finds itself in a curious position. It both points the way ahead as a market with explosive potential, but is currently far behind in terms of growth when compared to regions such as Asia, which are close to the peak of their growth curve.
The good, the bad
MENA has a combined population of 381 million, with youth shares at 57%, according to Ipsos. Millennials are typically more likely to try (and are more responsive to) mobile banking, and mobile itself has allowed some of the regions unbanked to access financial services for the first time, increasing the number of registered mobile money customers by 5.6% in 2018.
That said, in the Mobile Finance report, App Annie data showed that app downloads in MENA lag behind. Furthermore, “cash is still the dominant form of payment across MENA, despite nearly 60% of adults owning a bank account,” according to the GSMA. Meanwhile, regulation is viewed as holding the region back from embracing mobile money fully.
Our findings show that, even if growth is slow, ongoing retention rates point to favorable use among mobile banking users. In fact, some countries in MENA, such as Turkey (with a Day 1 retention rate of 31%), come out ahead of others like Japan (with a 21% Day 1 retention rate). Overall, retention rates point to a promising future for mobile banking.
Recent Adjust data reveals that MENA users keep using their mobile banking apps at a slightly higher rate than the global average (35% vs. 32% on Day 1). By Day 30, rates are 16% vs. 15% for the average Banking app. It’s an encouraging figure, establishing middle-eastern users as one of the most loyal a marketer could ask for.
A breakdown of retention by source revealed a particularly interesting trend. Before Day 14, paid users retained better, at 38% on Day 1 vs. organics’ 31%. By Day 14, the trend reverses, with organic users retaining better from the middle to the end of the month.
The total number of paid installs for Banking apps in MENA is on par with global rates, at 21%. This suggests advertising for Banking apps is a healthy bet. As for how often users open an app per day, sessions between paid and organic sources reach similar rates, at 1.72 per user per day.
Earning user loyalty
To find out how marketers in the region can capitalize on the markets we reached out to the experts. Deniz Guven, CEO of Virtual Bank by Standard Chartered, has first-hand experience with the region, and knows that “the MENA banking market has its own unique characteristics.” For example, customers prefer transacting in branches, as some are prone to worrying about mistakes when sending money to others. There is also the “Jetso mindset” to take into account, meaning that customers aim to maximize benefits and rewards as much as they can.
“We think banks in the region should focus on the whole customer lifecycle,” Deniz says. To build strong loyalty Deniz recommends providing a simpler customer experience that increases customers' peace of mind as a first step. In practice, he advises marketers to offer a “rewarding end-to-end journey that enables customers to continuously engage with their brand from onboarding through to transactions.” This, he adds, makes customers more loyal over the long run.