On February 16, 2012, Barclays of U.K. launched Pingit, a service that lets people send and receive money using a smartphone.
But this isn’t the first big innovation in mobile banking. These innovations are already happening in developing countries.
Poor countries are jumping ahead of rich ones by building a 21st century infrastructure (because they have little legacy infrastructure to begin with). For example, India has leapfrogged from no land-line telephones to the latest in wireless telephony. That revolution, in turn, is causing India to leapfrog brick-and-mortar banking to wireless banking for the masses. We see similar patterns in other poor countries as well. Mobile money transfer in Africa, M-Pesa, is a case in point. Counterintuitive as it may seem, poor countries may be ahead of rich countries in mobile banking.
The story of one such innovation, NPCI’s Inter-Bank Mobile Payment Service (IMPS), shows how far ahead India is with this technology.
India has a large un-banked population because of the challenge of reach and affordability. But with 840+ million mobile subscribers, mobile banking can provide a fast, inexpensive, easy, convenient and secure channel for customers across India to carry out banking transactions. While the mobile banking application of banks offers a set of services to its customers, there was a need for connecting major banks to offer an instant 24/7 remittance solution to customers. NPCI’s Inter-Bank Mobile Payment Service (IMPS) — an innovative payment mechanism — addresses this need.
NPCI has one major asset: The 60+ large banks in India connected to its ATM Network. It leveraged this infrastructure to cost-effectively offer an instant 24/7 payment service. NPCI used mobile as the channel. NPCI worked with banks and co-created this product in a very short time. It defined standards for message exchange using the same ATM connectivity infrastructure and provided a routing and settlement mechanism for transactions. The transactions are instant and immediate. Now that the banks are connected, many value-added services can also be offered through the same mechanism. NPCI plans to connect various approved non-bank entities offering prepaid solutions on this platform to provide wider access. NPCI itself is promoted by 10 leading banks in India. While these banks fiercely compete in the market, they also collaborate to achieve national objectives.
NPCI’s key innovations are:
Person-To-Person Mobile Banking
- Instant, 24/7, 365 days/year operation — the first such remittance solution without the need for cards of any kind, money moves from account to account instantly using mobile as the channel
- Works on all mobile phones
- Mobile Money Identifier (MMID)
- A unique 7 digit number for each account
- Enables customers to link same mobile to multiple accounts
- Removes chances of wrong transfer resulting from change of mobile numbers and typing errors
- Mobile number and MMID combination uniquely points to a bank account
- Works on the existing ATM Messaging, Switch and Network, making it easier for banks to adopt this quickly.
B2B Mobile Banking
With the ease and convenience of transfer and instant nature of payments, IMPS is now being used for merchant payments, bill payments, cash-on-delivery payments and as a corporate cash management tool. (A major bank, Citi Bank and major beverages company, Coca-Cola are doing pilots). NPCI is constantly enhancing these services. For instance, it is experimenting with the concept of mobile point of sale devices as a relatively inexpensive alternate to traditional point of sale terminals. This should help reduce the overall cost of the transaction and offer customers inexpensive payment options.
NPCI is also working on service innovations. Recently, it piloted a common USSD gateway application for banks. USSD is more secure than Short Message Service (SMS). NPCI will eventually establish connectivity with all telecom carriers and have a common USSD short code *99#. All customers of participating banks can just dial *99# and get an interactive menu to complete basic banking transactions. Customers can do basic banking transactions such as balance inquiry, funds transfer, merchant payments, cheque book request, statement request, etc. through a common number and a simple menu-driven mode irrespective of where the telecom account is and where the bank account is.
The M-Pesa in Africa and NPCI’s IMPS in India have the potential to revolutionize and democratize the mobile-based remittance/payments. These innovations can effectively transfer money across wide distances thereby saving cost of transport. For example, electricity bills can be paid from home instead of carrying cash to a distant office and having to wait in long queues. Mobile banking is cheaper, faster, reliable and secure. It can convert millions of “non-consumers” of financial services in the developing world into consumers, and large sections of the world’s poor population will benefit.
In time, the rest of the world will catch up too, as innovations created in developing countries flow into the developed ones.
This blog is co-authored with Mr. M. Balakrishnan, Chief Operating Officer of NPCI.
More is being spent on mobile advertising in the UK as the number of people ordering items forcourier delivery through devices like smartphones and tablets increases, according to a new report.
The Internet Advertising Bureau’s (IAB’s) 2011 Mobile Adspend Survey has revealed that companies are increasingly concerned with reaching consumers through mobile platforms as m-commerce becomes an increasingly important part of the retail landscape.
Advertising on mobile devices soared by 157 per cent over the course of 2011 to reach a record high of £203.2 million, the survey found.
This comes as mobile users become increasingly comfortable with purchasing items over their devices – a recent IAB report revealed 24 per cent of people have done so, with this figure likely to rise as smartphone penetration increases in the UK market.
Multichannel is also likely to be a growth market over the coming years, with 38 per cent of survey respondents admitting they had used a mobile device while shopping in a bricks-and-mortar store, a 35.6 per cent year-on-year increase.
Jon Mew, director of mobile and operations at the IAB, said the study indicated how crucial m-commerce has become to both consumers and businesses.
“With 26 million smartphone owners now in the UK, the opportunities for brands to interact with consumers in a more innovative and relevant way are endless,” said Mr Mew.
This was echoed by PricewaterhouseCoopers strategy manager Anna Bartz, who argued that advertising on mobile platforms is gaining increasing traction and influence, with more people becoming comfortable shopping for goods over their smartphones and tablets.
“The rapid adoption of smartphones and tablets means mobile is offering a compelling new way for brands and advertisers across all sectors to reach people,” she added.
A number of leading retailers have announced their plans to get more involved with the m-commerce market over the course of 2012, with Carphone Warehouse launching a new mobile-optimised site designed by multichannel experts Usablenet.
Vertical-specific topics take a backseat to basic customer care
Marketers in various industries have different goals for their social media efforts, from direct response to branding to everything in between. And a vertical’s regulatory environment can lead to vastly different approaches and levels of engagement. But on the consumer side, one concern remains paramount: customer service.
Research from text analytics service and customer experience solutions provider Attensity showed that, while social media conversations about banks, airlines and hotels were often topically oriented around something specific to the industry, the most common type of conversation for each industry was about customer service.
For the banking industry, customer service-related messages accounted for 41% of the total studied, followed by discussions of fees and rates, at 31%. Wait times at the bank—perhaps also a customer service issue—made up another 9% of conversation topics.
Among social conversations about airline brands, customer service was overwhelmingly the main topic, at 65%.
For other travel-industry brands, like hotels, social media discussions about customer service were less prominent (30%), but Attensity’s analysis of communications included more categories overall.
Social media marketers from all industries should know that consumer often turn to sites like Facebook and Twitter to vent their frustration—or, more happily, to rave about a good product or service—which means that regardless of overall social media marketing strategy, brands should be prepared to see and direct customer service-oriented discussions to the proper channels. For some, that will mean encouraging a Twitter user to pick up the phone or send an email, while for others, responding to complains and discussions directly on Facebook or other sites will work better.
Back in 2007, the Chief Executive of Visa Europe claimed that we could all be living in a cashless society by 2012. With that milestone fast approaching, it’s safe to assume that notes/bills and coins won’t be going the way of the dodo that quickly, but a new forecast has emerged from another giant from the finance world.
PayPal has produced a new report which will be released shortly – Money: The Digital Tipping Point – in which it predicts not only that consumers won’t need cash to go shopping, but they won’t need a wallet at all. And when can we expect this vision to be realized? 2016, it seems.
We’ve written quite extensively about mobile payment technology in recent times. Back in September we spoke with Ben Milne, founder of peer-to-peer Web and mobile payment platform Dwolla, who discussed the future of m-commerce. And prior to that, The Next Web’s Brad McCarty looked at how NFC will get its piece of the $4 quadrillion payments pie. There’s little question mobile payments will play a big part in the future of commerce. But will it completely outmanoeuvre paper, coins AND plastic by 2016?
Around 45 million people in the UK use a mobile phone, and 49% of mobile users surveyed use their device to purchase products at least once every three months. But there is still a big demand for in-store purchases too, as we saw with London’s Oxford Street retailers gearing up for Christmas by introducing a number of tech initiatives to help capitalize on the growing m-commerce trend.
PayPal’s findings are based on interviews by Forrester Consulting with 10 senior executives from major UK retailers and other businesses, with a combined turnover of £85bn.
“We’ll see a huge change over the next few years in the way we shop and pay for things”, says Carl Scheible, Managing Director of PayPal UK. “By 2016, you’ll be able to leave your wallet at home and use your mobile as the 21st century digital wallet. Our vision of money is to enable you to pay for something from wherever you are, whatever device you’re on – a PC, mobile phone, tablet, games console and a whole lot more.”
Indeed, Scheible continued by saying that it will take another 4 years before we’ll see the real beginning of money’s digital switchover in the UK, but he stopped short of any discussion relating to a ‘cashless society’. “We’re not saying cash will disappear entirely, but we’ll increasingly use our phones and other devices rather than our wallets to pay in-store as well as online”, he says. “The lines between the online world and high street will soon disappear altogether. Children born today will become the UK’s first ‘cashless generation’. It will be completely natural for them to pay by mobile.”
So the real prediction here is that the uptake of mobile payment technology will increase significantly over the next 4 years – something that most people would probably agree with. But at the rate we’re currently going at, and with the likes of NFC technology gaining momentum in the micro-payment sphere, cash could be under threat sooner than we may otherwise have realized.
By 2016, it’s thought that UK mobile retail sales will hit £2.5bn. PayPal currently has over 14m active UK accounts, over a million of which have been used to send a mobile payment. Around the world, PayPal expects to process more than $3.5bn (£2.25bn) in mobile payments this year, five times more than in 2010.
Meanwhile, PayPal has produced this little infographic, outlining its vision:
La Commonwealth Bank prévoit de «révolutionner» le paiement mobile en Australie avec une nouvelle appli baptisée Kaching combinant NFC, paiements en P2P et «paiements sociaux» via Facebook.
Le nom de «Kaching» évoque le son d’un tiroir caisse, et le service sera l’appli de paiement la plus complète lancée par une institution bancaire.
Selon un porte-parole de la Commonwealth Bank contacté par Relaxnews, «Kaching est la première appli de services bancaires en ligne au monde à fusionner paiements par réseau social, peer-to-peer et NFC (communication en champ proche). C’est ce trio de technologies qui permet à cette appli de se démarquer et d’offrir à notre clientèle les avantages du service clients au travers d’améliorations et d’innovations. La possibilité de payer un ami sur Facebook constitue également une première mondiale».
Les utilisateurs de Kaching pourront faire des paiements jusqu’à 100$ à leurs contacts téléphoniques, e-mail et Facebook.
“Selon le type de paiement, la transaction aura lieu soit instantanément, soit après la réception d’un code unique par le destinataire, qui pourra ainsi accéder à la somme en ligne au moment qui l’arrange”, explique le porte parole de la Commonwealth Bank. “Pour Facebook, une notification sera envoyée au destinataire pour l’informer qu’il a reçu le paiement, et le code est nécessaire pour toucher l’argent”.
Les paiements en P2P et en NFC commencent à décoller aux Etats-Unis suite au lancement de Google Wallet et à l’ascension de startups comme Square.
L’Australie est le deuxième pays au monde en termes de smartphones par habitant, derrière Singapour, mais les technologies de paiements mobiles ne s’y sont pas encore banalisées.
Les banques se montrent traditionnellement frileuses à l’idée de développer les services de paiements mobiles et la plupart des consommateurs ne sont pas au courant qu’ils existent, mais avec le cachet de l’une des quatre grandes banques australiennes, les Australiens devraient s’y mettre rapidement.
«Les paiements mobiles et en ligne constituent la prochaine étape des technologies de transactions financières. Plus de la moitié de nos 10 millions de clients possède déjà un smartphone, et les Australiens ont 65% de chances en plus que les Britanniques d’employer leurs téléphones pour des services bancaires», d’après David Lindberg de la Commonwealth Bank, dans un communiqué du 25 octobre.
«Pour la première fois, les Australiens n’auront plus besoin de compter sur les espèces et les chèques cadeaux pour donner de l’argent à leurs familles, amis, ou même à des entreprises. L’explosion récente de l’adoption de smartphones et autres technologies numériques a révolutionné la façon dont nous menons tous nos transactions, dont nous interagissons et communiquons entre-nous, et cette nouvelle appli fera du rêve de paiements mobiles une réalité», poursuit David Lindberg.
D’après la banque, jusqu’à 50% des mobiles seront équipés du NFC d’ici 2014, et ceux-ci généreront «jusqu’à $50 milliards en transactions mobiles à travers le monde».
L’appli Kaching sera lancée sur iPhone au cours des prochains mois.
Commonwealthbank se prépare également à lancer un étui smartphone iCarte intégrant le NFC, mais son prix reste à déterminer, d’après un porte parole de la banque.
Une version Android de l’appli Kaching est prévue pour 2012.