Banking Fintech

TABLET BANKING – Tapping into the mobile banking culture

“I want to be buried with a mobile phone, just in case I’m not dead”. These thoughts were once expressed by Amanda Louise Holden, an English actress, singer and presenter. Such a statement is no surprise given the fact that the mobile phone and tablets are gradually being recognised as inseparable human organs these days from the body. Users trust them as much as or even more than they trust themselves. These are evolving from merely being a gadget and gradually becoming an extension of one’s personality

To put things in perspective, the nature of apps loaded in one’s mobile and tablet reveals a little too much about the characteristics, interests and skills of an individual. Therefore, no industry could stay away from mobile and tablet revolution across the world and banking industry is no exception. We have used the word “Culture” as a part of our main topic i.e. “Tablet Banking –
Tapping into the mobile banking culture”. A question we may want to ask ourselves is – Is it truly a culture or a mere practice, which is being exaggerated? Could it evolve as a culture if it not presently? The answers is a big “Yes” and let us explain the rationale, the why’s and the how’s behind it. In the era of 1950’s-60’s and 70’s i.e. nearly 40 – 60 years ago, movies or theatre often used to enact a pitiful scene where someone is robbed of his or her wallet on a busy railway station or a bus terminal, and the person is forced to beg for money so that the destination could be reached. Should perspective, the nature of apps loaded in one’s mobile and tablet reveals a little too much about the characteristics, interests and skills of an individual. Therefore, no industry could stay away from mobile and tablet revolution across the world and banking industry is no exception. We have used the word “Culture” as a part of our main topic i.e. “Tablet Banking – Tapping into the mobile banking culture”. A question we may want to ask ourselves is – Is it truly a culture or a mere practice, which is being exaggerated? Could it evolve as a culture if it not presently? The answers is a big “Yes” and let us explain the rationale, the why’s and the how’s behind it. In the era of 1950’s-60’s and 70’s i.e. nearly 40 – 60 years ago, movies or theatre often used to enact a pitiful scene where someone is robbed of his or her wallet on a busy railway station or a bus terminal, and the person is forced to beg for money so that the destination could be reached. Should mobile banking, is a big “Yes” and let us explain the rationale, the why’s and the how’s behind it. In the era of 1950’s-60’s and 70’s i.e. nearly 40 – 60 years ago, movies or theatre often used to enact a pitiful scene where someone is robbed of his or her wallet on a busy railway station or a bus terminal, and the person is forced to beg for money so that the destination could be reached. Should perspective, the nature of apps loaded in one’s mobile and tablet reveals a little too much about the characteristics, interests and skills of an individual. Therefore, no industry could stay away from mobile and tablet revolution across the world and banking industry is no exception.  Should mobile banking, tablet banking or payment bank have existed in those times, such scenes in movies or even in could not be feasible. One may offer a simple solution like why not transfer some money through mobile banking and help yourself? Why not pay your travel by using a combination of mobile number and m-pin, which are meant to be memorized and not physically lost? Thus, the larger point we are trying to make is mobile and tablet banking has the potential to change the culture of the society from being a real cash carrying economy to a virtual cash economy, latter being safe from such physical thefts. Gradually, the theft instances may significantly drop and isn’t this a drastic change of culture? Since we are talking about a“Culture” of tablet and mobile Banking, it would be appropriate to cite a reference to Reserve Bank of India’s Report of the Technical Committee on Mobile Banking which amongst other things make a mention on Brazil’s “Lei Do Bem” (Law of the Goods) enacted in Oct 2013. It mandates that smart phones shall give visibility to Brazilian made apps by either pre-loading phones with these homegrown apps or providing a dedicated marketplace on smart phones to display them.

The report further recommends that a similar intervention in India can support and incentivise the relevant stakeholders to either ‘pre burn’ common mobile banking application on mobile handsets / SIM (Subscriber Identity Module) cards or send ‘over the air’ using dynamic STK (SIM Application Tool Kit) to facilitate financial transactions. This is a “build-it-they-will-come” approach. Considering the case of India, the report goes a step ahead and further recommends “the developments in mobile telephony, as also the mobile phone density in the country, with over 870 Mn subscribers, presents a unique opportunity to leverage the mobile platform to meet the objectives and challenges of financial inclusion. By harnessing the potential of mobile technology, large sections of the un-banked and under-banked society can be empowered to become inclusive through the use of electronic banking services.” the larger point we are trying to make by citing a reference to this report is that the emerging markets of the world are indeed serious about the role of mobile and tablet banking in transforming their nations into strong and financially inclusive economies. In order to make the most out of tablet and mobile banking, a great amount of focus and attention is needed in striking the right balance between “Creating a demand” and “Meeting this demand with a strong supply side”. Increasing the levels of awareness of the consumer can create demand. However, to strengthen the supply, there is a need for competition in the market.

A standalone demand or a standalone supply serves no real purpose. Simultaneously, technology should evolve on a regular basis so that basic services like payment, SMS based fund transfer etc. are a reality in days ahead of us. A great co-ordination and a spirit of teamwork is required, both from the banks and Mobile Network Operators (MNO’s) so as to make this newly evolving culture
a huge success. MNO’s can make money by providing the service whereas banks can save money by reducing their cost per customer. If mobile or tablet banking of a particular entity is strong enough, there is less demand and need for opening a branch, which otherwise is a costly proposition to realise and hence emerges the concept of branchless banking. A Banking entity effectively saves the cost of operating a branch, if its mobile or tablet banking is of real worth. Thus, branchless banking enabled via tablet and mobile banking is a sustainable solution and win win win proposition for the producer (a Bank), facilitator (MNO) and consumer (Customer) of services. Gone are the days when mobile was a device that only connected people with people i.e. voice communication only. With the advent of data communication, people do not necessarily need other people for communication purpose and may even communicate with a device alone and simplify their life by leveraging banking and other financial services at the swipe of one’s finger. Sherry Turkle of Massachusetts Institute of Technology rightly says and we quote “It used to be that we imagined that our mobile phones would be for us to talk to each other. Now, our mobile phones are there to talk to us.” It could be gaming device, also a tutor, sometimes a gate to social network and of course, a Bank with capabilities nearly as good as a physical brick and mortar branch. So, opportunities are endless and sky is the limit. In this value chain, technology acts as a key enabler without which the concept does not find any existence and therefore technology as an industry generates a constant source of revenue in lieu of services they offer. Since, in this whole exercise of mobile and tablet banking the idea of efficiency and accuracy is supreme, there is minimum manual operational intervention and hence risk is also minimal. It is together with these multiple advantages that mobile and tablet banking is consolidating and emerging as a value proposition, which exists not just as an option, but also as a necessity which is going to be the face of future banking across the globe. It saves time for the country, which could be deployed by its citizens, for more productive purposes. It saves fuel for the nation and hence reduces its energy burden by reducing the frequency of a branch visit for banking customers. It empowers the consumer to self solve their banking requirements 247 at a time of the day or night that suits them, irrespective of the fact whether it is mid night or Saturday afternoon when branches are typically closed. Progressive economies are not satisfied with mobile or tablet merely being an instrument that facilitates banking. Instead, the concept of payment banks is evolving wherein telecom operators could offer simple financial services. Countries like India have recently promoted the concept of payment banks by allowing Telecom operators to offer financial services. Mobile phones are widespread in all parts of the world. They surpassed the number of landline phones in any given country, long ago.

Hence, if an industry wants to connect with entire country in one single instance, the best possible alternative is to connect using mobile phone. Countries like India managed to use social network very effectively for the huge election campaigns held earlier this year, and the primary access device was a mobile phone. ICICI Bank, one of the most successful banking entities in India since inception, had been very proactive in terms of launching campaigns related to tablet banking. So, the crux of the matter is, stakeholders do realise the potential of mobile and tablets, and use them in a manner that could maximise their commercial gains. On an optimistic note with regards to how and how quickly things may change, if one were to discuss the technology called ATM nearly 15 years ago, it would sound very unrealistic and food for thought. However, 15 years later, it seems unrealistic if a bank doesn’t deploy an ATM so as to dispense cash and offer other related basic banking services by using Information Technology (IT). Similarly, today, mobile or tablet banking could be discussed as a potential technology that will make its presence felt in days or years ahead, however, it is poised to achieve the same status that ATM technology did, during the past one decade. One may have laughed at the idea of a machine counting and dispensing accurate cash inside a supermarket, but the fact is that it is a widespread observation today. Similarly, we shouldn’t be surprised if there are kiosks that could generate a credit or debit card in a matter of few seconds inside any shopping malls. On the same lines, tablet banking allows verification and due diligence process to be completed in a matter of few seconds, as it has the capability to talk to various other systems that hold customer’s identity information. The possibilities are endless… In this whole exercise, there is a risk of loosing the simplicity and making the whole process a little cumbersome if standardization is missing. Why not the registration process of every bank is standardised? Why not the MNO’s, hand set manufacturers, resellers initiate pilot programs so as to develop the single multi-bank mobile banking applications, which can maintain the simplicity of the whole process and could be preloaded to the handset? A step further – Why not the Central banks across the world come together and share their vision on mobile and tablet banking, such that rather than a financially inclusive India or financially inclusive Malaysia or financially inclusive America, we can have a financially inclusive universe of all countries – big and small, developed and under developed, from far east to middle east to the West? These are some questions to which the global banking fraternity needs to find an answer so that there is nothing like banking untouchability or unbanked in this world … The onus is on us to realise this objective and mobile and tablet banking could well be the most effective implementation road map.

 

 

 

 

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