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ACCA Applied Knowledge · Business and Technology · Technological factors

A bank introduces a mobile app allowing customers to open accounts, transfer money and apply for loans without visiting a branch. Which of the following is the most likely consequence for the bank's service delivery?

A mobile banking app lets customers use services at any time and allows the bank to cut back on expensive branch networks. Online activity does not escape regulation, and digital delivery does not inevitably lead to higher fees; it normally lowers the bank's cost to serve.

  1. AServices become available 24 hours a day, and the bank can reduce reliance on costly branch networksCorrect
  2. BThe bank can no longer be regulated because transactions occur online
  3. CCustomers will inevitably demand higher fees because the service is more complex

Explanation

Mobile apps give customers round-the-clock access and let the bank lower the fixed costs of branches. Online banks remain subject to financial regulation. There is no inevitable link between digital delivery and higher fees; the usual effect is lower cost to serve.

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