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Net Banking / Mobile Banking
 
    Net Banking / Mobile Banking Services in India - A Dataquest Survey
 
 " The number of people using mobile banking services has jumped from under 10,000 to 120,000 in two years. While the trend is growing, lack of awareness of services, apart from perceived security issues, are inhibiting faster takeoff. " - Dataquest

It was clear at the start itself—that this would be a battle focused not on technology, but on the mind set of the target audience. Over two years after the launch of mobile banking services in the country, that bridge has been reached… and many are beginning to walk those cautious steps across it. Yes, the usage of mobile banking services is increasing, and fast—against Dataquest’s estimated user base of under 10,000 for mobile banking services in 2000, there are over 120,000 today who SMS from their mobiles to do their banking.


But before you assume that things are hot and moving on this front, check out the catch—even this number of 120,000 represents only 1% of the overall mobile user base. Also, a majority of those who do use mobile banking services only do it to check account balance, with very few actually conducting transactions. Reasons for this—lack of awareness of services offered by banks, and equally important, a perceived issue of security and confidentiality. Clearly, banks have not done enough to push their bouquet of mobile banking services. Even our survey—despite targeting a respondent profile that would bring in more positive answers than negative (see Methodology), threw up very low usage numbers.

Also, e-commerce as a medium of purchasing and transacting has not really caught on, and the basket of mobile banking offerings is, in itself, very limited. The good news—the technology backbone is in place, and getting better. There’s CDMA, there’s GSM. Forget their battles on the mobile telephony front—from the consumer’s point of view, he never had it so good.


 "The recent price cuts are also likely to help," say banking experts, adding that this will lead to "increasing willingness to move on to mobiles, and therefore, to the value-added services that most operators offer today". If you have a head that likes numbers, then get a load of this—Cellular Operators’ Association of India figures show a growth in subscriber base from 700,000 in December 1997 to over 1 crore in December 2002… that’s growth of over 1300%!


And bankers are punching away at their calculators and beginning to develop futuristic grins while driving daily to their banks—even if 1% of today’s mobile phone base were to use their services, that’s a total number of around 120,000. Factor in a similar number within the year for CDMA users (assuming policy changes allow service providers in this space to offer SMS, as Reliance Infocomm is already promising), and you have a total mobile banking user base of a very healthy 240,000 (our survey points to an awareness rate of 26%, a usage rate of 7% on the total respondent base of 360.

As mentioned, the sample was skewed toward upmarket, well-to-do people in the metros, and a move toward smaller towns and cities would bring that percentage down radically.

Given such increasing penetration in India and across the globe, it’s not hard to understand why m-commerce is a hot subject today. According to research firm Ovum, mobile commerce is currently pegged at a little over $5 billion worldwide and is expected to grow to over $35 billion by 2007. Others like Forrester Research estimate the same at $22 billion by 2005, while Frost & Sullivan expect this market to touch $24 billion in the same period. And banking is going to be a major benefactor of the same. According to studies by some global firms, one of the most used services for mobile commerce would be mobile banking—with services like transfers, balance and trading bringing in the revenues for mobile bankers.

Source: Monday, January 27, 2003
Click here to read the full Dataquest Survey
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