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A new research conducted by Consultative Group to Assist the
Poor(CGAP) found new insights into the banking traits.
The study convincingly says that the
banking is cheaper in comparison to formal banks. A clear 54%
difference exists between the transactions that are by mobile banking
than from informal options for money. CGAP says the price gap between
branch less banking providers and banks was “not as large as expected.”
On a medium deposit size of $69, mobile banking services were found
to be only 19% cheaper, with formal banks proving the significantly
cheaper option for “high” deposits of $207.
In more recent research CGAP is doing, a trend of low income clients
paying on average 15% of their saving value to use M-PESA. the reason
is not tough to guess, the kind of security that is being given is far
superiror than by other modes. Way back in 2008, 21% had said that '
wallet was the most important way' of saving.
The study done by CGAP also elaborates on how three billion mobile
users living in developing countries have fewer options of transferring
money and accessing banks as there is less formal banking
infrastructure (fewer branches, ATMs generally co-located to relieve
branches rather than stand-alone, low internet penetration). So a
branchless banking channel using mobile phones could be far preferable
to poor people than the available options: travel to and queuing at
distant branches, and savings in cash or physical assets.
The study substantiates enough reasons as to how can mobile phones
with ite 'unique' features can become a close substitute as a powerful
banking channel.
The research also takes a overall outlook on the m-banking and
mentions some of the challenges that are existent and are playing as
hurdles. For customers, mobile banking presents a delicate balance
between a conceptually powerful opportunity (being able to transact any
time, anywhere) and practical challenges (finicky menu sequences on a
small screen and tiny buttons). Many banks launched into mobile banking
without a well-articulated idea of what customers' problems were and
how to address those problems.
Phones on the most common standard in the world have both a highly
secure “smart card” (the SIM) and a “card reader” in one device. And
all phones have “native” technologies (SMS and USSD) that can be used
to create banking interactions. To be sure, mobile phones are likely to
always be limited in functionality than a PC that is online or a
specialized point-of-sale (POS) device, but because of inherent
functionalities and its ubiquity, the phone is seen by providers as a
possible lower-cost alternative to banking via internet or ATM or
point-of-sale. Early results from CGAP's experiments with providers
show that using branches could cost 30 times more to set-up than using
third-party agents equipped with point-of-sale. Replacing the
point-of-sale device with a cell phone will have further cut cost
in half.  Â
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archanasi@cybermedia.co.in