MOBILE BANKING

In the monetary policy statement for 2008-09 announced on 29th April the Reserve Bank of India has indicated that the draft guidelines concerning mobile banking will be placed on RBI website by 15th June this year.Once RBI guidelines become operational it it will be possible to use mobile phones by people for their normal banking transactions .The RBI guidelines are likely to focus on safety and interopearability issues in using mobile phones for conducting normal banking services.
Mobile banking will greatly enhance customer convenience and it will enable customers to tansact their banking business from any place or even sitting at home.It is a low cost channel .Mobile phone services have extensively penetrated in all parts of the country.There are about 231 million mobile phone connections in the country at present This will surely increase in the years to come.The youth consider mobile phones a necessity of life and hence mobile phones are very popular among youth.Mobile banking will facilitate fuller financial inclusion of the new generations of people by bringing into banking fold all young men and women having mobile phones.With the increase in the number of people using mobile phones more and more people can be brought into banking fold.Mobiles have reached all parts of the country incuding remote rural areas where we do not find bank branches and even post offices.Because of such penetration of mobile phone services mobile banking has great potentialfor inclusive banking .It will also be useful for remittances and payments.Payments of bills of service providers,utility bill payments,payments to merchants and traders etc can be made with ease through mobile banking.
Mobile telephone operators are collecting payments i.e pre-paid amounts or post-paid mobile phone bills from remote rural areas without any problem.It is time now to utilise this low cost channel for providing banking servicessuch as payment services ,deposit services,remittance facility etc However RBI has to put in place necessary safeguards by adequately addressing issues such as security,money laundering issues etc.In the long run particularly after the present generation gets replaced by new generations mobile banking facilty can surely be used as an insrument of fuller financial inclusion in the country.This will help expand the reach with little cost for banks also apart from facilitaing avilment banking services by mobile phone users at low cost.The RBI initiative is indeed a good and welcome development and the same augers well for the future of inclusive Indian banking.