Mobile Banking and Protocols: development for Safe Access

The Mobile banking system, which is otherwise known as the mbanking, SMS banking or M-banking is a system that is recently developed to check balance, to perform account transactions, and to make payments through the mobile phone. Mobile banking at present is done through the use of the short messaging service, the mobile internet or other downloadable program that can be downloadable by clients to his or her mobile. In essence, it is the process by which an individual can avail financial and banking transactions through the use of a mobile device. Simply think of an ordinary banking transaction and instead of going to banks, do it through the menus of a mobile phone.

One of the reasons why mobile banking developed is due to the fact that more and more people require financial services to be more accessible and if possible 24 hours a day and seven days a week. This is what the mobile banking service seeks to address in order to empower business oriented individuals to perform financial transactions any time and anywhere. In fact, the wireless banking has been one of the fastest emerging markets at present which is expected to reach 35 percent of the total households using online banking by the end of the year 2010 according to Celent. Likewise, Celent added that the bank call center volume will exceed 70 percent and will come from mobile phones. Interesting, Asian countries are on the lead in mobile banking despite the fact that most of the Asian countries are far behind the European countries when it comes to fixed line infrastructure. This is due to the fact that while Asian countries such as China, India, Indonesia, and Philippines lagged down in terms of fixed line infrastructures, these countries have excellent mobile infrastructures. In fact, there are about 80 percent consumers that have mobile phones and are likely to use the services of mobile banking features provided by their network providers.

Among the basic services that are provided by mobile banking are access to account information, payments and transfers, investments, supports, and other content services. In terms of account information, mobile banking provides for checking of account and short statement of accounts, alerts on account activity or alert when threshold limit is reached, term deposit monitoring, loan statement access, card statement access, equity statement access, insurance policy and pension plan management, status of checks as well as stop payment order of checks. The mobile banking system also allows domestic and international transfer of funds, micro payments, commercial and bill payment processing as well as peer to peer payments. Investment services can also be availed through mobile banking which includes, portfolio management, real time stock quotes, notifications and alerts on security prices and many more. Support services include ATM location, data message or email exchange, complaint and tracking submission, card and check book requests, credit status request and insurance coverage. Other than this, the mobile banking service provides for weather, news and general information, location based services and other loyalty related offers.

Accordingly, the Mobile Commerce Prospects: A Strategic Analysis of Opportunities in the Banking Sector stated that the mobile banking increasingly gained the acceptance of various sectors of society and this acceptance is attributed to the technological, the demographical, and socio-cultural impact of the mobile banking in the population. The study also revealed that many banks located in Germany regard mobile banking as a potent tool to thwart the negative differentiation and to foster an innovative image in online banking. While many fear on the security of these mobile services, it must be emphasized that there are protocols established that are aimed to minimize the risks involved such as the use of passwords and second level security which consists of transaction numbers or TANs which are basically a single use password. Also, most mobile banking companies provide their consumers with devices called security token devices that are capable to generate passwords that can only be used at once and is often referred to as two-factor authentication or the 2FA. Also, in order to combat fraud, many mobile banking providers now avail of one-time passwords or OTP.

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