Mobile banking has today become a necessity rather than a luxury service. With the growth of technology, users no longer have to stand in long ques and vail banking services. Banking has now been provided to their through their smart phones through mobile banking. Mobile banking is a term which signifies that users can avail their banking services through the touch of their of phones. Thus, in the age of convenience, today, banking and financial institutions have provided banking services in the phones. Mobile banking enables the users to remotely use their bank through smartphones. The method used by the banks are that they formulate a software called an “App” which is freely available to be downloaded by the financial institution or concerned bank. By a secure network, they can use the services. This mechanism, ensures complete safety and anonymity and is available twenty four hours a day unlike the traditional banks.
History of mobile banking
Prior to the revolution of smart phones, existed another service called the SMS. It was an instant messaging service provided the network providers which would instantaneously send messages across the different phones, often charging a small amount. Banks, looking at the potential use of the SMS facility joined in to cash in on the benefits. However, with the introduction to smart phones and internet being provided on to them, it changed the field completely. The European banks were the first to provide customers with the facility of mobile banking.
With the growth of Apple and Android phones, the growth of technology had also been steadily increasing with the development of app based platforms. In the early 2010s, Apple began testing the platforms of mobile banking and soon android started testing the same. By 2015, apps were being built by almost all the major banks across the world and financial institutes also joined the bandwagon. By 2019, all major banks across the globe had started offering mobile facilities and had a consumer base of over twenty million.
Mobile banking in India
India, being a mostly cash based economy has often struggled with accepting digital payment. However, with the sweep of payment gateways and offers that it brought along, coupled with the effect of demonetisation, there has been a sweep of mobile baking facilities available across India. There are various features that one can avail through mobile banking. It solely depends upon the app provider and how much the bank has spent and willing to spend in technological development. Apart from the usual, transfer, payment, checking the balance and account statement, there are other features which they can see. They can pay their water or electric bill, avail discounts via paying through mobile banking, shop online, and create a new saving or deposit account. Some major commercial banks have gone a step forward and enabled them to avail car loans and complete all large scale transactions. This is very convenient for businessmen who on a click of a button can avail all the benefits that they would in a normal visit to the bank. It improves speed, efficiency and it is extremely consumer friendly. From the banks perspective, it reduces the employee cost as everything is done over a web interface. It also reduces the chances of the people barging into the banks for every tiny little detail. All the little things can be over at the swipe and over a touch of a button. Some banks, in advanced countries have provided an option of remote transfer of cash to ones bank account. Being extremely user friendly, safe and secure, it has revolutionised modern banking.
In India, mobile banking services are regulated by the Reserve Bank of India. RBI through its master circulars has laid down guidelines and procedures for the banks to be followed to enable the customers to use mobile banking facilities.
However, banks in India are cautious of the people and their spending habits and have put a cap on much they can transact through mobile banking. Further, India having a large rural inhabitant base is still struggling to provide connections in every remote corner. Since mobile banking is based completely on internet, areas which receive a poor signal strength or have a bad internet connection fail to avail these services.
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Frequently Asked Questions
What is mobile banking?
Mobile banking is a term which signifies that users can avail their banking services through the touch of their phones.
Who enabled mobile banking first in the world?
In the early 2010s, Apple began testing the platforms of mobile banking and soon android started testing the same. By 2015, apps were being built by almost all the major banks across the world and financial institutes also joined the bandwagon. By 2019, all major banks across the globe had started offering mobile facilities and had a consumer base of over twenty million.
How is mobile banking operating in India?
In India, mobile banking services are regulated by the Reserve Bank of India. RBI through its master circulars has laid down guidelines and procedures for the banks to be followed to enable the customers to use mobile banking facilities.
How does RBI regulate banks who provide mobile banking facilities?
RBI through its master circulars on technology, KYC, telecom, remittance of funds, board approval has provided various rules and regulations on how to control and regulate banks which provide mobile banking facility.
