An Overview and future scope of Mobile Banking Introduction Indias telecom mobile subscriber base crossed another milestone

to top 560 million connections by the end of 2009 with a record 19.10 million new users being added during the month of December, according to latest figures released by the sector's watchdog. The total number of mobile phone users in the country now stands at 525.15 million. According to the sector's regulator, Telecom Regulatory Authority of India (TRAI), 19.1million new mobile connections were added in December to take the country's tele-density ton impressive 47.89%. Indians mobile phone subscriber base in larger than the number of bank accounts or internet users. Given the mobile tale density of approximately 50%, banks are well-positioned bridge the digital divide and introduce the unbanked sector to the financial mainstream. In this respect, the Reserve Bank of India had set up the Mobile Payments Forum of India (MPFI), a Working Group on Mobile Banking to examine different aspects of Mobile Banking (M- banking). The Group had focused on three major areas of M-banking, i.e., (i) technology and security issues, (ii) business issues and (iii) regulatory and supervisory issues. After examining the detailed report of MPFI and accepting the recommendations of the group, thereby has finally decided to implement it in a phased manner. Accordingly, the following guidelines are issued for implementation by banks. Banks are also advised that they may beguile by the original report, for a detailed guidance on different issues. What is Mobile banking? Mobile banking (Also known as M-Banking, m - banking, SMS banking etc.) is a term used for performing balance checks, account transactions, payments etc. via a mobile device such as a mobile phone or Personal Digital Assistant (PDA). Mobile banking is most often performed via SMS or the Mobile Internet but can also use special programs, called clients, downloaded to the mobile device.Mobile Banking refers to provision and availability of banking- and financial services with the help of mobile telecommunication devices. The scope of offered services may include

facilities to conduct bank and stock market transactions, to administer accounts and to accesscustomised information."According to this model Mobile Banking can be said to consist of three inter-relatedconcepts:

Mobile Accounting

Mobile Brokerage

Mobile Financial Information ServicesMost services in the categories designated Accounting and Brokerage are transaction-based.The non-transaction-based services of an informational nature are however essential for conducting transactions - for instance, balance inquiries might be needed before committing amoney remittance. The accounting and brokerage services are therefore offered invariably incombination with information services. Information services, on the other hand, may beoffered as an independent module.Mobile phone banking may also be used to help in business situations. Market Size and growth Trends

The mobile banking market has grown significantly over the past several years, particularlyin the US, where many financial institutions now offer some form of mobile services for their customers.According to the January 2008, e marketer article, More flip phones and clamshells will become portable ATMs in coming years.According to a study by financial consultancy Celent, 35% of online banking households will be using mobile banking by 2010, up from less than 1% today. Upwards of 70% of bank centre call volume is projected to come from mobile phones. Mobile banking will eventuallyallow users to make payments at the physical point of sale. "Mobile contactless paymentswill make up 10% of the contactless market by 2010.Many believe that mobile users have just started to fully utilize the data capabilities intheir mobile phones.In Asian countries like India, China, Bangladesh, Indonesia and Philippines, where mobileinfrastructure is comparatively better than the fixed-line infrastructure, and