Mobile banking set to become a standard product

Implications: 1.There is a wide interest among consumers for mobile banking services not only in India but also world wide. 2. ATMs have been used by banks not only to expand their reach to customers but also to offer value-added services.

Analysis: Indian banking sector has made a quantum leap forward in terms of switching over from paper-based transactions to electronic means. More people in India are now moving towards using ATM for their banking needs. ATMs are now seen to be more than cash dispensing machines. Customers use ATMs to recharge their mobile phone pre-paid connections, pay their utility bills, even mutual fund transactions-making them on par with internet banking-only more secure.  

Technology and the liberalisation of financial markets are driving structural changes in Indian banking sector. Significant advances in technology are enabling people to move beyond cash and even cheques as a mode of payment. According to latest Reserve Bank of India data, almost 75% of total transactions (in value terms) in 2006-07 were in electronic format as compared to about 30% three years ago.  

With the branch automation pushing transactions out of banks to more cost-effective channels and increasing focus on retail product sales, there is a necessity to design products to suit the needs and requirements of relevant target customers. Mobile banking has transcended from a purely technology-driven product to a business-focussed customer service. It provides a sizable opportunity for banks to offer value added, innovative services and attract new customers from technology savvy financially affluent sections of the society.  

Time seems to be ripe to convert this customer interest into business – driving customer demand.