Wallet Watch

Mobile banking holds a lot of promise — both industry experts and nonprofit activists hail it as a transformation in the industry. Industry experts like to be able to reach consumers anywhere — banking by mobile device will make banking possible all the time — and nonprofit experts see the potential for more low-income and/or underbanked people to have better access to accounts that can help them build assets.

Nonprofit experts make a great case. The estimated 10 percent of Americans who don’t have bank accounts — who are overwhelmingly low-income — have no place to store their money, and don’t have access to the types of accounts that help them build interest, build credit, and to the larger array of financial services such as car loans, student loans, and home mortgages. Given that cellphones have become a ubiquitous item, reaching the underbanked by cellphone seems like a terrific delivery system.

But will we realize that mobile banking will be filled with the same hidden fees and pitfalls that bank accounts are currently laden with? The mobile banking experience reminds me of the hype around prepaid debit cards as a way to transition underbanked people to the banking system, but then the types and numbers of fees with prepaid cards started to seem overwhelming.

Let’s not forget that banking on the web, in concert with the proliferation of ATMs in the late 90s, was supposed to transform banking also. In many ways it has transformed banking. But the internet hasn’t led to the disappearance of bank branches as was predicted. And in fact a plan by Bank One to charge customers money to speak to a teller — designed in part to increase the use of ATMs and internet banking — flopped miserably.