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Doug Peacock demonstrates the new ATM mobile banking feature BMO Harris Bank is newly releasing to the public Friday, March 13, 2015, in Milwaukee.

Darren Hauck/The Associated Press

Canadian banks are rolling out new additions to their mobile banking operations, highlighting the importance of smartphones in their strategies for attracting and retaining customers who now have more options than they used to.

Toronto-Dominion Bank announced a redesign of its Android and iPhone apps, making them simpler and more intuitive, and adding a new feature that allows users to make U.S. bill payments.

"The result is a more engaging experience that is quick and simple to use and allows customers to do more while on the go," Rizwan Khalfan, TD's chief digital officer, said in a statement.

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The timing follows, by one day, Bank of Montreal's introduction of Mobile Cash, a new technology that gives customers in the United States the option of withdrawing money from any of the 750 BMO Harris ATMs using smartphones rather than debit cards – promising to cut down transaction times and boost security, given that customer card information is not stored on the phone.

"BMO Harris is continuing to invest significantly in technology that is designed to address consumers' evolving preferences," Connie Stefankiewicz, BMO's head of North American channel strategy and solutions, said in a statement.

"Smartphones are quickly becoming the singular device that people use to help manage their life."

The banks' bet on the smartphone as a banking tool appears to have a solid foundation – but it is just one of many developments that are affecting the way people deal with banks, or circumvent them.

Goldman Sachs recently published a series of reports analyzing how new technology, a shifting regulatory environment and changing demographics are disrupting traditional banking.

"We believe the companies driving this change will extract considerable market share gains, grow the category, and fundamentally change the way borrowing, lending, paying, and investing are done," Goldman Sachs said in its report.

They estimate that consumer payments alone is a $1.2-trillion (U.S.) global industry that is now being upended by so-called megatrends: 60 per cent of millenials are regularly performing mobile financial transactions, payment transaction fees are being held down by governments and network improvements are changing the mechanics of moving money.

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"We are still in the early stages of this shift in behaviour, as today's cutting edge features and services become part of the basic minimum that consumers will insist upon a year from now," Goldman Sachs said.

The trends are not confined to North America. Goldman Sachs noted that African consumers are taking to mobile payments faster than the rest of the world, as they live in a region that is short on traditional banking.

Royal Bank of Canada's chief executive David McKay highlighted these shifts in a recent speech, noting that mobile payment systems offered by technology companies can push traditional banks into a lower-profile relationship with customers, which isn't good for the banks.

"We are on a collision course with the Googles and the Apples of the world," Mr. McKay said.

You can see why: Apple Inc. says that 750 banks and credit unions have signed up for its Apple Pay digital wallet, which launched in October, and accounts for about two-thirds of "contactless payments."

RBC is one of many Canadian banks – along with wireless providers, tech companies and credit card companies – developing digital wallets of their own, giving customers the option of making retail purchases with their smartphones rather than plastic cards or cash.

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RBC has rolled out its digital wallet to clients already, but has yet to announce it with a splashy launch.

The RBC Mobile Wallet works for Android and BlackBerry users on Bell Mobility and Virgin Mobility networks. In late spring, a new version of the app will become available to all Android users, according to an RBC spokesperson.

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