i nc lu s i ve f i nanc e i nd i a re port 2014
74
B
OX
3.9
Major Recommendations of the Technical Committee on Mobile Banking
• Banks need to explore other means of facilitating customer/user registration process for mobile banking which does not
require a visit to the bank branch. The potential of inter-operable ATM networks and BC arrangements has to be effectively
harnessed towards meeting this objective. Committee felt that standardization is required in (a) user registration for mobile
banking, (b) user authentication process, and (c) user interfaces. Recognizing the crucial role that customer/user awareness
plays in adoption of any technology for financial transactions as well as the need for optimal utilization of resources, the
committee is of the opinion that joint customer education programs by banks will go a long way in facilitating usage of
mobile banking.
• Mobile Network Operators (MNOs) need to see a business model in it for themselves and play out their role in ensuring mobile
banking reaches its full potential by cooperating with banks in their endeavor to provide the appropriate technology/ channel
to the targeted users. Mobile banking can result in customer stickiness and reduce churn for MNOs. Mobile banking can
increase revenue to MNOs and reduce costs to banks. The current solutions already provided by banks and various technological
alternatives available can be put in place through a concerted effort between banks and telecom service providers.
• Common mobile banking applications and common technological platforms need to be built for reaping the benefits of
‘network effects’. While bank-specific applications and individual platforms have a major role in building brand loyalty, an
alternate uniform/common platform, interoperability and similar seamless transactional experience to the users/customers of all
banks would encourage mobile banking.
• The Government of India can explore the options of offering fiscal incentives/economic subventions to the stakeholders in order
to ensure participation of various players.
• The customer may not be required to visit the bank branch for mobile number registration. Alternate channels for mobile
number registration may be made available, such as interoperable ATM network across banks as well as the BC/agent network
using biometric authentication, so that the customer can register the mobile number conveniently.
• The process of M-PIN generation may also be simplified and standardized without necessitating a visit to the bank branch by
the customer, so that the customer can be on-boarded in an easy manner and start transacting using mobile payments, and
reduce barriers to entry.
• Banks may implement multiple channels (application, SMS, USSD, etc.) for mobile banking so that options are available to all
types of customers with any type of handsets with suitable level of security.
• For facilitating funds transfer using mobile banking, the remitting customer may be facilitated to effect person-to-person funds
transfer using just the mobile number and bank or just the Aadhaar number of beneficiary.
• Customer may be able to make merchant payment using just his mobile number and M-PIN/OTP on the merchant interface.
The M-pin can be only interfaced on acquiring bank’s interface such as USSD, application, etc., for security reasons. The
merchant-based interfaces can accept OTP (One-Time Password) for authentication.
• To overcome the challenges faced by each bank in tying up with a large number of MNOs, and to facilitate the reach and usage
of mobile banking through USSD, there is a need for common USSD gateway for mobile banking. A common USSD gateway-
based mobile banking service offers an opportunity to provide convenient, cost effective and user-friendly payment option for
all customers and thus a very convenient mechanism for banks for furthering financial inclusion objectives of the Government
of India.
• The large corporates, third party players and MNOs, handset manufacturers/resellers may initiate pilot programs to develop the
single multi-bank mobile banking applications which can use published public keys of the banks/banks’ agents for encryption.
The common application may be developed by reputed organizations having successful track record in this field.
• The common application may be pre-loaded in the handset—the mandate to be issued by Government of India to all handset
manufacturers/resellers in India. Handset manufacturers may be directed to burn the application on all new handsets.
• It is imperative that the bank staff is well versed and thoroughly trained in various aspects of the mobile banking. For this
workshop may be conducted for top officials including the chief executive of the banks; training program may be conducted
during induction programs and probationary officer courses. Banks may also periodically conduct refresher courses to ensure
staff is abreast with latest developments in these fast-paced technology areas in mobile banking.
• Banks must continue to invest in handholding and educating customers to increase the awareness of various aspects of mobile
banking. Banks collectively may invest in marketing and advertising for widespread promotion of mobile banking.
Source
: RBI (2014b).
