Bank of America Believes Digital Strategy Can Double Market Share

By focusing on mobile platforms and investing in P2P money-sending network Zelle, BoA is expanding quickly.

Need to Know

  • The Bank of America is investing in digital-first banking strategies like AI, P2P money transfers, and mobile platforms.
  • Bank of America currently has 38.3 million active digital banking users.
  • CEO Brian Moynihan believes Bank of America could double its market share from ~12% to ~24%
  • Bank of America is part owner of Zelle along with other large financial institutions in the US.
  • Users of P2P network Zelle sent 300 million transfers totaling $78 billion in 2019.


CEO Brian Moynihan believes that the Bank of America can double its market share, which he estimates at between 12-14% in the US alone, without opening more branches. 

Bank of America’s strategy lies in digital growth: online, mobile, AI-powered, and peer-to-peer (P2P) banking.

“Our market share in consumer is probably 12, 13, 14 per cent, depending on who counts . . . The reality is, you could double that,” CEO Brian Moynihan said in an interview with the Financial Times.

After a successful launch of its industry-leading AI assistant Erica, which has been used by more than 10 million customers since its launch in June 2018, the Bank of America hopes to expand in every other digital space.

Currently, 45% of all Bank of America mortgage applications and 61% of all total direct auto applications come in digitally. Also, 29% of all consumer sales are digital, and 53% of all digital sales were done via mobile. 

Digital-first is a strong strategy considering that the bank has 38.3 million active digital banking users and 29.2 million active mobile banking users. The bank’s wealth management division has even drawn away from expanding internationally because they see so much growth potential in the US.

On an earnings call, CFO Paul Donofrio said, “Digital Banking continued to drive growth in client engagement as we continue to invest heavily in this channel, as a strong complement to our financial centers and ATM network. Together they allowed our customers to bank with us, anywhere, anytime and any way they want.”

As deposits increase beyond industry averages, by almost $50 billion in 2019, the Bank of America is cheering on and investing in Zelle, its P2P network.

In 2019, 9.7 million Zelle users sent and received 300 million transfers totalling over $78 billion, and scheduled 2.3 million digital appointments, which is up 19% year-over-year.

Zelle is owned by Early Warning Services, a private financial services company co-owned by Bank of America, BB&T, Capital One, JPMorgan Chase, PNC Bank, US Bank, Citibank, and Wells Fargo. 

For the big banks, Zelle is the answer to combat the rise of PayPal-owned Venmo, a similar P2P money-sending network that has massive market share.

Outside innovation is forcing the banks out of their comfort zones and into digital-first strategies, which is ultimately having an effect on traditional banking, as well. 

On a recent earnings call, Moynihan said, “Since Zelle really pushed out there about two years ago, the number of checks written has started dropping 10% per year. So five years ago, we had almost $1 billion checks written by consumers, and now we’re down to $600 million. Each one of those checks is a piece of paper that requires processing time, and you’re seeing that drop by 10% a year.”

By naturally minimizing the costs of traditional banking and investing in digital, Bank of America is doubling its confidence in the future of digital payments.