Mobile Banking

 

AT&T, T-Mobile USA and Verizon created ISIS to develop consumer payments on mobile devices in addition to receiving coupons. The joint venture will partner with banks and credit card companies to allow consumers to swipe their phones and make purchases. Initial launch was set for 2012.

Yankee Group (June 2011) predicted that there will be 500 million m-banking users globally by 2015. Yankee found that 27 percent of all survey respondents used mobile banking -- far more than use m-commerce (13 percent), mobile coupons (11 percent) and mobile payments (9 percent).

 

Worldwide mobile payments will hit $240 billion in 2011, and are expected to grow two to three times that amount within the next five years, according to consulting firm Juniper Research.

Berg Insight (April 2010) estimated that in 2015 there will be 894 million users globally of m-banking and related services (including money transfers). Growth is being driven by efforts by operators and banks in developing countries (particularly in Asia) to bank the unbanked.  More than half of global MFS customers will be in Asia Pacific – Middle East and Africa is also expected to be important market – as mobile operators drive initiatives to bank the unbanked.

 

In developed nations m-banking will be driven by banks:

 

ABI: Banking institutions will be the major promoters of MFS, as it helps to increase customer “stickiness”, help banks cut costs and automate, and most importantly, to reach the unbanked. In the US, Bank of America is a leader of m-banking. Launched in May 2007 it now has 1.5 million subscribers.

 

Remittance/transfers by mobile is growing much faster than m-banking (driven by developing nations)

Berg Insight predicts international money transfers will increasingly be done by mobile. By 2015 3-15 percent of transfers handled by agent networks today will be carried out by mobile handset (worth US$1.2–6.2 billion in revenues to the mobile industry). Juniper Research predicts the need to access basic financial services by users in developing countries will drive the short term growth of active mobile money users globally to exceed 200 million by 2013. Well under 100 million people used these services as of February 2011. 

 

Gemalto, a world leader in digital security, announced that NetOne, a leading network operator in Zimbabwe, deployed Gemalto’s LinqUs solution for mobile money transfer, which is comprised of the server, user applications, as well as system integration services. Marketed as the OneWallet service, it works on 100 percent of the handsets and enables all NetOne subscribersto perform secure and convenientmoneytransferusing their mobile phone. In particular, it provides the unbankedwith access to secure banking services. Services include secure and easy peer-to-peer money transfers, payment of everyday bills and topping up users prepaid phone cards. Expanding the possibilities, it also enables NetOne’s customers to have their salaries paid directly onto their phones – an innovative feature that greatly empowers the unbanked with a secure and convenient digital wallet solution. Gemalto sees the sector is growing rapidly, with the number of active users of mobile money services predicted to double in the next two years, exceeding 200 million by 2013 with nearly 40 percent of active users in 2015 in the Africa & Middle East regions.

 

The mobile banking end game will be about much more than checking balances and paying bills. It will evolve into a mobile wallet, allowing banks to generate greater electronic payment volume through the combination of electronic loyalty programs, mobile marketing, and contactless payments. Juniper Research reports that financial institutions are delivering an increasing variety of products in the mobile environment, from fund transfers, bill payment and presentation to account management and customer service.

 

Handsets can now be used to buy online, via “swipe” points in retail outlets using Near Field Communication (NFC) technology and mobile-to-mobile purchase. However, the phone can be used as more than a banking tool – it can serve as the location for the account, hold all the financial information and be used as the primary security measure. User adoption of mobile banking, in the form of remittance, money transfers, bill payments, commerce and financial transactions is on the rise with the help of driving forces from financial and credit communities, software providers, e-commerce companies, device manufacturers and mobile network operators. 

 

The GSM-HSPA evolutionary family offers many differentiating factors associated with application security and trust for mobile banking or e-commerce, making these access technologies the clear leader in the mobile industry. The devices and network infrastructure implemented in today’s networks give them a considerable advantage over competing technologies, and place these operators at the leading edge of trusted mobile application offers.