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RBI norms and mobiles pose hurdle for mobile banking
By siliconindia
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Saturday, 11 October 2008, 17:11 IST
Mumbai: Mobile banking, a recent buzz word in the banking sector is struck with obstacles before its complete landing in the country. The solutions which are mostly based on general packet radio service (GPRS) and wireless application protocol (WAP) are not supported by the basic handsets held by majority of the masses. Moreover, there are also some RBI regulations which add to the hurdles of the service.
As reported by Financial Chronicle, Vijay Balakrishnan, Chief Marketing Officer (CMO), Obopay a mobile payment service provider says, "Around 60 percent of the 306 million handsets or mobile connections in India are without GPRS and WAP." Thus, instead of subscribing to a solution, the common folk have to rely upon SMS-based services but there is a considerable amount of insecurity attached to it. "One fraud and the whole confidence of users go down. The SMS-based banking is insecured as these are not encrypted and the data can be easily leaked," says Sourabh Jain, CEO of ngpay, a mobile�commerce platform.
Apart from handset obstacle there are the RBI norms for mobile banking which stands as an impediment for rural people to have an access to it. One of them makes it a compulsion for people to personally come over to the branches to avail the benefit of the solution. Moreover, there is also the rule that everyone should produce proper verification documents. But considering the difficulties for the rural masses to travel long distances for going to any bank or its branches, the unbanked people may subside the idea of mobile banking. And according to a PSU bank employee, "People residing in rural areas will not be able to provide verification documents and Know Your Customer (KYC) compliance and hence will not be able to bank at all."
