1. MOBILE BANKING
Prasanna.S , Department of Commerce CA , Sri Krishna Arts and Science
Darshan.K , Department of Commerce CA , Sri Krishna Arts and Science
Technology plays an important role in banking sector. Banking is one of the largest
financial institutions constantly explores the opportunity of technology enabled services to
provide better customer experiences and conveniences. Mobile banking (also known as M-
banking, SMS banking) is a term used for performing balance checks, account transactions,
payments etc. through a mobile device such as mobile phone. The increased prevalence of
mobile phones provides exciting opportunities for the growth of mobile banking (M-banking).
Now a days, the bank customers were depending on the net or the bank straightly for all their
account details and can't able to involve in the bank process directly. This Problem can be solved
through mobile Banking System. The main aim of the mobile banking is to access the bank
process that is used to reduce the customer transaction-time as well as user can able to access
from anywhere through mobile. From the bank's point of view, mobile banking reduces the cost
of handling transactions by reducing the need for customers to visit a bank branch for non-cash
withdrawal and deposit transactions. Mobile banking does not handle transactions involving
cash, and a customer needs to visit an ATM (Automatic Teller Machine) or bank branch for cash
withdrawals or deposits. Many apps now have a remote deposit option; using the device's camera
to digitally transmit cheques to their financial institution. Mobile banking differs from mobile
payments, which involves the use of a mobile device to pay for goods or services either at the
point of sale or remotely, analogously to the use of a debit or credit card to effect an EFTPOS
(Electronic funds transfer at point of sale)payment.
Key Words: Mobile Banking , Customer, Technology and Apps
Twelve billion people are expected to own mobile phones in the globe by 2018 (Mobile
economy, 2018). There are currently 475 million mobile phones in India and 148 million are
added every year. In a few years more than 790 million people are expected to have mobile
phones in India (Peterson, 2009).Mobile commerce is a natural successor to electronic
commerce. The capability to pay electronically coupled with a website is the engine behind
commerce . Electronic commerce has been facilitated by Automatic Teller Machines (ATMs)
and shared banking networks, debit and credit card systems, electronic money and stored value
applications and electronic bill presentment and payment systems( Ashta , 2010). Mobile
payments are a natural evolution e-payment schemes that will facilitate mobile commerce. A
mobile payment or m-payment may be defined, for our purposes, as any payment, where a
mobile device is used to initiate, authorize and confirm an exchange of financial value in return
for goods and services (Barnes and Corbitt,2003). Mobile devices may include mobile phones,
PDAs, wireless tablets and any other device that connect to mobile telecommunication network
and make it possible for payments to be made (Clark, 2008). The realization of mobile payments
will make possible new and unforeseen ways of convenience and commerce. Unsuspected
technological innovations are possible (Amir, 2003). Banks gain various benefits of e-banking
services, Such as lower Interaction costs, provide services 24 hours a day , increasing the
efficiency of the banking process.
One of the newest electronic distribution channels for banks is mobile banking t hat
technology is increasingly vital for them, that increase comfortable and add value to the bank and
the customer. Due to the obvious advantages of this technology , now the system has gained
great popularity in European and Asian countries(Taghavi Fard And Torabi, 2010). The biggest
advantage Mobile Banking provides to the banks is that it helps to cut down the costs as it's even
more economic than providing tele-banking facilities where banks have to keep hundreds of tele-
callers. Additionally, Mobile Banking helps banks to upgrade the quality of services and nature
of customer relationship management. Using Mobile Banking, banks can communicate to the
defined cluster of clients.
It offers can be customized and this personalization can give the banking industry a huge
mileage, even at a lower cost. Again, using the same mobile channels, banks can up-sell and
cross-sell their highly complex financial products to the specific set of customers which can be
3. coupled with the selling strategies of Credit Cards, Home Loans and Personal Loans etc. On the
contrary, the service providers can also accrue more business by providing the Mobile Banking
services to their clients. Countries like Japan, Korea or Singapore where the mobile connectivity
has already reached its saturation, the service providers can make handsome business by
providing additional banking services to the same static client base.
ADVANTAGES MOBILE BANKING
In Mobile banking, the user can transfer funds from your bank account to another bank
account with a smartphone just with the help of the internet, from anywhere to everywhere. It is
available for 24 hours and easy and convenient mode for many Mobile users in the rural areas.
Mobile Banking is said to be more secure and risk-free than online Internet Banking. With the
help of Mobile, Banking user can transfer funds, and pay bills, checking account balance, study
your recent transaction, block your ATM card, etc. Mobile Banking is cost-effective, and Banks
offer this service at less cost to the customers. The most obvious advantage is, of course, easy
access. With only a smartphone in your hand, you have a possibility to check your balance,
transfer your funds or pay bills.It’s safer to use a special app than online Internet banking. The
greatest advantage is that most banks allow their customers to do online shopping without paying
bills, which is very useful for online stores’ fans.
4. Also, you can easily monitor your account – you can check your transfers, transaction history,
deposits etc. Mobile banking is something like remote control. Mobile banking is available round
the clock 24/7/365, it is easy and convenient and an ideal choice for accessing financial services
for most mobile phone owners in the rural areas. You can check your account balance, review
recent transaction, transfer funds, pay bills, locate ATMs, deposit cheques, manage investments,
DISADVANTAGES MOBILE BANKING
Mobile Banking is not available on all mobile phone. Sometimes, it requires you to install
apps on your phone to use the Mobile Banking feature which is available on the high-end
smartphone. If the customer does not have a smartphone than the use of Mobile Banking
becomes limited. A transaction like transfer of funds is only available on high-end phones.
Regular use of Mobile Banking may lead to extra charges levied by the bank for providing the
service. Mobile banking users are at risk of getting fake SMS messages and scams. The loss of a
mobile customer device often means that criminals can gain access to your mobile banking PIN
and other sensitive information. Many consumers use mobile banking on their cell phones or
other portable device because it allows them to quickly access information such as account
balance and transaction history. The benefits of this convenience are undeniable, but there are a
number of disadvantages that mobile banking users should be aware of.
The technology's cost, compatibility issues and security problems may cause you to think
twice about using it. The main disadvantage is that it is not suitable for every phone. If you want
to use mobile banking, you can download the app, which is available only for smartphones.
There is a risk of hacking too, but it is easy to be safe from that – don’t share your password with
anyone.Mobile banking gains popularity from year to year. This option deserves attention,
because it allows you to use money without leaving home. Now, when you know how mobile
banking works, you can start using it and check by yourself how convenient it is. Some people
feel uncomfortable to provide their passwords or any kind of information about their funds over
the internet. Some websites might be difficult for consumers for the first time to check their
finance. Hacking and viruses will cause problems for online banking, which could brake and
damage the information. Regular use of Mobile Banking may lead to extra charges levied by the
bank for providing the services.
5. SECURITY ISSUES IN MOBILE BANKING
Financial institutions must assume the risk associated with mobile banking. These risks
come in many forms, including malware, corrupt apps, flawed authentication, lost or stolen
devices and more.
Devices have evolved from telephones to pocket-sized computers. Mobile users must
recognize this and protect them in the same way they would their PC. Malware specifically
targeting mobile devices has become a very real and prominent threat. Mobile malware can
consist of viruses, Trojans, spyware, malvertising and rootkits. Banks in Singapore have
implemented various security measures such SMS One Time Password.
(OTP)fraud monitoring, transaction-signing and transaction alerts to protect
customers against fraudulent online transactions.Banks have strong controls to
protect their systems and infrastructure against cyber-attacks, hackers are
increasingly turning their attacks on users through social engineering and
6. If a customer’s smartphone is compromised or infected by malware, hackers
can intercept information that the customer provides or SMS OTPs the
customer receives on his/her smartphone when performing online financial
transactions. Hence, it is important that customers observe all necessary
security safeguards in using his/her smartphone.
Using mobile apps for banking tends to be safer than logging in via your mobile browser.
However, every mobile platform has unique characteristics that these apps must prepare
Developers may not fully understand the risks associated with mobile banking and
accidentally leave vulnerabilities open for fraudsters to exploit as a result.Third-party
apps open users up to a multitude of risks since these programs may leverage credentials
from other applications — even if these apps have weaker security in place.
For example, a shopping app could leverage your banking login information (username
and password) to access your bank’s services to facilitate a transaction.
Unsecured Wi-Fi Networks
Free Wi-Fi is a coveted luxury for mobile device users. It can be found in restaurants,
coffee shops, airports and many other public places.
But when accessing free Wi-Fi, it is important to understand that the activity you are
conducting may be visible to someone else.Hotspots may be spoofed by fraudsters.
For example, your local coffee shop’s network may be called FreeCoffee. A fraudster my
set up Wi-Fi at or near that location called FreeCoffee1 to trick you into using that
network. According to the Financial Consumer Agency of Canada, “When using public
Wi-Fi hotspots, you could also expose yourself to packet sniffers.
7. Thieves using packet sniffers want your banking details and your personal information,
such as your name, address or phone number. These personal details may be harmless on
their own, but once they are combined, you can be at a higher risk for fraud.”
Mobile Banking sets off the journey with a mission of reaching to target group of people
across our country. The globalization facilitates the extinction of untidy and troublesome
services in order to consolidate the very variegated, faster as well exquisite services to keep the
people in regular touch of modernization. Considering this decision, banks and financial
concerns took some welcome move recently. Usually all private owned banks from abroad
coupled with a few local banks in collaboration with domestic support launched the trend of on-
line banking. The completely refurbished banking sector stresses effort to spread this culture of
banking. Therefore, the banks should move ahead of its rivals by applying the recommendations
provided above. Certainly, it will help reducing the gap (or dissatisfaction) & retaining existing
customers. And, once this dissatisfied customers become satisfied, it will not only help to retain
existing customers, but it will also help to drag new customers through positive word-of-mouth
communications. Also, it will help to attract new segments with different needs. Many customers
are dissatisfied due to some areas of incompetent services. So, in order to sustain in the highly
competitive banking industry.