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Carry the bank in your mobile
Bindisha Sarang, Outlook Money
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June 19, 2008

In reply to the question 'Where is your bank?', if I answer 'In my hand.', I am not exaggerating. With your cellphone, you can now make several banking transactions. "Today, there are more than 300 million cellphone users in India. We expect a huge number of them to become mobile banking service users. So, we are focusing on it," says M G Sanghvi, general manager, Dena Bank [Get Quote].

Small start. Many customers have already started using SMS alert facility that sends messages to their cellphones whenever a significant transaction takes place in their bank, credit card or other accounts.

Besides SMS facility, there is interactive demand facility that allows you to get banking information or transact over the phone. You can check account balance, payment of bills, the last three transactions in your account and cheque status as well as give stop payment orders.

Technology. Mainly, three technologies, SMS, GPRS and unstructured supplementary service data (USSD), are used to provide mobile banking services (see It's At Your Fingertips). As these are evolving, more complex transactions are being allowed through cellphones.

An ICICI Bank [Get Quote] spokesperson says, "Our bank allows all Internet banking transactions over cellphones. Customers can now transfer funds to ICICI Bank from other bank accounts. Savings, dematerialised, credit card and loan accounts have been brought under this facility. Customers can also pay their utility bills and insurance premium through this facility."

To reach a wider audience, a few players, such as Barclays Hello Money, allow both English and Hindi interfaces.

Service charges. As of now, the service do not cost much as most banks are providing the service free, while some are charging a small fee. Cellular service providers, however, charge for the SMS or the GPRS facility.

Iron locker. The safety issue, however, is still a concern for several customers. Several banks assure that mobile banking is secure since most transactions work on a four-digit mobile banking PIN. Three incorrect PIN entries lock the application. And, if you lose your cellphone, you can contact the customer care centre to block the feature immediately.

"As long as the technology is safe, dissemination of information is confidential. For restricted use, one would not mind using the facility," says Antara Dasgupta, a 25-year-old Mumbai-based lawyer.

Worldview. Globally, m-commerce has taken a big step. In Japan, you can use it instead of plastic money for shopping. Unlike in plastic money, there is no card number, card verification value or expiry date and other details. So the chance of misuse is also less.

Domestic circle. Experts say that mobile  banking has not gained the momentum in India. However, Reliance Communications [Get Quote] and HDFC Bank [Get Quote] have launched the mPay credit card, where the cellphone number replaces the card number.  It can be used for all transactions that credit card is good for.

HDFC Bank authenticates information with RCom, and the cellphone can be used to initiate and authorise all payments. Also, mPay services can be used for Reliance cellphone and Reliance Energy [Get Quote] bill payments. In future, it will be extended to allow the customer to book movie and travel tickets, and make payments at shops.

Also, Airtel has launched Mcheck for bill payments in collaboration with various banks. You can also pay your ICICI Prudential policy premium through it.

Sai Narain C.D.K., general manager (Consumer Transaction Banking & Strategic Initiatives), Standard Chartered Bank, says, "We launched it in 2008. We have an aggressive road map for our mobile banking initiatives. In the next few years, we do see it taking over a significant share of the transactions. There are several approaches and models being tried out in the industry."

Scanner. Since many more players are expected to plunge into this promising revolution, the RBI is expected to issue guidelines for mobile banking and m-commerce next month.

Now that the advanced technologies have simplified your life, you can make more out of your bank. After all, it's only an arm's length away.

It's at Your Fingertips

There are three technologies available in the market for accessing your bank account using your cellphone



GPRS: For this you need a Java-enabled handset and subscription to a GPRS connection.


Unstructured Supplementary Service Data

More Specials

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