Mobile Banking in India

(MOBILE BANKING IN INDIA)
INDEX
SR.NO. CONTENT PAGE NO.
1. ABSTRACT 1
2. INTRODUCTION 2
1.1. CONCEPT OF MOBILE BANKING 3
1.2. MOBILE BANKING BUSINESS MODEL 4
1.3. MOBILE BANKING IN INDIA 5
• MOBILE AS A MEDIUM 6
• DEVELOPMENT IN MOBILE TECHNOLOGY 7
• MOBILE BANKING SERVICES 8
• ORIGIN & POTENTIAL OF MOBILE 10
BANKING IN INDIA
1.4. MOBILE BANKING IN WORLD 11
3. TECHNOLOGIE ENABLING MOBILE 12
BANKING
4. ADVANTAGES & DISADVANTAGES OF 16
MOBILE BANKING
5. FEATURES OF MOBILE BANKING 19
6. CHALLENGES OF MOBILE BANKING 21
7. FUTURE PROSPECTS OF MOBILE 24
BANKING
8. TOP 10 MOBILE BANKING APP IN INDIA 26
9. IMPACT OF COVID-19 ON MOBILE 31
BANKING
10. RESERVE BANK OF INDIA REGULATION 35
11. OBJECTIVE OF THE STUDY 37
12. SCOPE OF THE STUDY 38
13. NEED OF THE STUDY 39
14. RESEARCH METHODOLOGY 41
15. HYPOTHESIS OF THE STUDY 44
16. LIMITATION OF THE STUDY 46
17. REVIEW LITERATURE 47
18. DATA ANALYSIS 51
19. CONCLUSION & SUGGESTION 67
BIBLIOGRAPHY 74
APPENDIX 77
MOBILE BANKING IN INDIA
1. ABSTRACT
Mobile banking is a revolution that is driven by the world’s one of the fastest growing
sectors – mobile communication technology. Like in any emerging technology, there
exist barriers to the adoption of mobile banking services. This study explores the issues in
mobile banking perceived critical for adoption by both mobile banking users as well as
non-users. The study identified certain issues pertaining to banks, mobile handsets and
telecom operators viz. mobile handset operability, security/privacy, standardization of
services, customization, Downloading & installing application software and Telecom
services quality. For this a descriptive design was adopted to empirically explore the
selected issues. Study suggests that from consumers’ perspective mobile handset
operability, security/privacy and standardization of services are the critical issues.
Although the research has its limitations, the implications of the results provide practical
recommendations to the all concerned parties.
Key Words: Banking, Mobile Banking, Features, Challenge, Prospects, Impacts, India,
etc.
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2. INTRODUCTION
A. GENERAL INTRODUCTION
In India traditional branch-based banking remains the most widely adopted method of
conducting banking transaction, at same time commercial banks are undergoing a rapid change
majorly driven by the information & telecommunication (ITC) technology. ICICI bank
pioneered in mobile banking services in India. Among public banks, Union Bank of India was
first to introduce mobile banking (Ali et al. 2010). Today many commercial banks have
launched mobile banking using ITC technology and now they can reach out to customers and
provide them with not only general information about its services but also the opportunity of
performing interactive retail banking transactions anytime, anywhere.
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1.1. CONCEPT OF MOBILE BANKING
Mobile Banking refers to provision and availment of banking and financial services with the
help of mobile telecommunication devices. The scope of offered services may include facilities
to conduct bank transactions, to administer accounts and to access customized information
(Tiwari and Buse 2007). In the broader sense mobile banking as that type of execution of
financial services in the course of which - within an electronic procedure - the customer uses
mobile communication techniques in conjunction with mobile devices (Pousttchi and Schurig
2004).
Mobile Banking can be said to consist of three inter-related concepts viz. Mobile Accounting,
Mobile Brokerage and Mobile Financial Information. Mobile Accounting is sometimes
characterized as transaction-based banking services that revolve around a bank account and are
availed using mobile devices. Not all Mobile Accounting services are however necessarily
transaction-based. A more precise definition of Mobile Accounting would therefore
characterize it as “availment of account-specific banking services of non-informational nature”.
Whereas Mobile Brokerage, in context of banking services, refers to intermediary services
related to the bourse. ,e.g. selling and purchasing of stocks. Mobile Brokerage can be thus
defined as transaction based mobile financial services of non-informational nature that revolve
around a securities account. At last, Mobile Financial Information refers to non-transaction
based banking and financial services of informational nature. It includes subsets from both
banking and financial services and is meant to provide the customer with anytime, anywhere
access to information. The information may either concern the bank and securities accounts of
the customer or it may be regarding market developments with relevance for that individual
customer. The information may be customized on the basis of preferences given by the
customer and sent with a frequency decided by him (Tiwari and Buse 2007).
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1.2. MOBILE BANKING BUSINESS MODELS
1.2.1. Bank-focused model
The bank-focused model emerges when a traditional bank uses non-traditional low-cost
delivery channels to provide banking services to its existing customers. Mobile phone banking
to provide certain limited banking services to banks’ customers which are additive in nature.
This model may be seen as a modest extension of conventional branch-based banking.
1.2.2. Bank-led model
The bank-led model offers a distinct alternative to conventional branch-based banking in that
customer conducts financial transactions through mobile phones instead of at bank branches
or through bank employees. This model promises the potential to substantially increase the
financial services outreach by using a different delivery channel. i.e. mobile phones and may
be significantly cheaper than the bank-based alternatives. The bank-led model may be
implemented by either using correspondent arrangements or by creating a JV between bank
and non-bank mobile operator. In this model customer account relationship rests with the
bank.
1.2.3. Non-bank-led model
The non-bank-led model is where a bank does not come into the picture (except possibly as a
safe-keeper of surplus funds) and the non-bank/mobile operator performs all the functions
(Morawczynski et al. 2008).
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1.3. MOBILE BANKING IN INDIA
Mobile phones have become an essential communication tool for almost every individual
worldwide. In India, where mobile subscribers far exceed fixed line subscribers because of
better mobile infrastructure in comparison to fixed line infrastructure has made mobile banking
much more appealing in India today. Various players involved in providing mobile banking
services whether banks, financial institutions, service providers, operators etc. are therefore
expecting a potential growth in mobile banking in India (Unnithan and Swatman 2001).
However, the actual mobile banking usages don’t match the great number of mobile subscribers
(617 Mn, May2010 source: TRAI) in the country. Reason could be various issues involved in
mobile banking services like Interoperability- due to lack of mobile banking technology
standards and large number of different mobile phone devices (Banzal 2010; Mas 2008; Lyman
et al. 2008), Security of financial transaction – both at physical level i.e. security of mobile
device and data encryption level (Sharma and Singh 2009; Astha 2009; Banzal 2010),
Regulatory authority – RBI & TRAI conflicts on regulations in India (Weber 2010; Cheney
2008), Telecom service quality - network congestion, delay in SMS delivery while using any
mobile banking service (Morawczynski 2008), Personalization of services – preferred language
of user, standard beneficiary list, customized alerts etc. (Owens et al. 2006), Customer illiteracy
– a serious issue at reading illiteracy level and technical illiteracy level (Manuel 2008),
Revenue sharing basis – problem in the revenue sharing agreements between mobile service
providers, banks, content providers and aggregators (Banzal 2010), Know Your Customer issue
– to prevent money laundering (Hayat 2009) etc. Mobile banking users are affected by above
mentioned issues directly or indirectly.
Perception of mobile banking users towards these issues and their concern will definitely affect
adoption of mobile banking in India. This papers attempt to explore various mobile banking
issues from users’ perspective and to alert various parties involve in mobile banking services
viz. mobile operators, banks, content providers, aggregators etc. about relevant issues which
could become challenges for them in providing effective mobile banking services.
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1.3.1. MOBILE AS A MEDIUM
In this context, the question that often gets debated is: how and why is a mobile device the most
appropriate delivery channel of financial services? Besides the technology capability to
transmit financial information in an efficient, secure and costeffective manner enabled by
development of mobile based applications for banking, the most significant fact about this idea
is the ubiquity of the mobile phones. The number of mobile phones in the country are said to
be nearing a billion phones. Hence, banking and financial services, which have already come
a long way from the branch level services to the customer’s home desktop and laptop, can now
be reached to a much larger section of the society, including the financially excluded, through
the medium of the mobile phones. Besides the reach of mobile, there is another reason why
mobiles are the most appropriate medium. What is after all a banking transaction? What
purpose does the traditional cheque serve? In India, if you forget to carry your cheque book for
withdrawal of funds, they provide you with what is call a withdrawal slip. A cheque or a
withdrawal slip is a personalized direction to your banker to put through banking transactions
on your behalf. The authentication is achieved through your signature. But this traditional
method is expensive. A mobile phone achieves the same purpose and enables you to send
personalized secure instructions to your banker to undertake transactions on your behalf. If
your bank has achieved seamless integration with the CBS, then the transaction gets
automatically registered. But these transactions using mobile are far less expensive than its
traditional alternatives. More importantly, you hold the key since mobile is in your pocket and
you need not depend on bank timings or the rush there to undertake banking transactions. This
is perhaps the most important advantage of the mobile over other alternate payment methods.
The mobile phone can, therefore, empower the common man to conduct his payment
transactions any time and from anywhere. It is, therefore, no wonder that mobile payments and
mobile banking are being hotly debated in various forums, in India and abroad.
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1.3.2. DEVELOPMENTS IN MOBILE TECHNOLOGY
Motorola1 was the first company introduced mobile phone in the year 1973, which is very
costly and also more weight (in Kgs) when compared with present mobile sets which are cheap
and small in size.
1st Generation (1G): The first analog cellular system widely deployed in North America was
the Advanced Mobile Phone System (AMPS). It was commercially introduced in the Americas
in 1978, Israel in 1986, Australia in 1987 and India in the year 1995.
2nd Generation (2G): Second generation mobile communication replaced the analog signal
with digital signal.
There are two major technical developments occurred that is GSM and CDMA technologies.
The NTT DoCoMo in Japan introduced internet service on mobile phones in the year 1999.
3rd Generation (3G): The mobile phone became essential communication system for millions
of users worldwide. The 3G technology developed with the concept of packet switching instead
of circuit switching for data transmission.
4th Generation (4G): The fourth generation technology introduced in the year 2009 with the
technology advancement like WiMAX & Long Term Evolution (LTE) technologies.
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1.3.3. MOBILE BANKING SERVICES
Mobile banking can offer services such as the following:
Account Information
1. Mini-statements and checking of account history
2. Alerts on account activity or passing of set thresholds
3. Monitoring of term deposits
4. Access to loan statements
5. Access to card statements
6. Mutual funds / equity statements
7. Insurance policy management
8. Pension plan management
9. Status on cheque, stop payment on cheque
10. Ordering check books
11. Balance checking in the account
12. Recent transactions
13. Due date of payment (functionality for stop, change and deleting of payments)
14. PIN provision, Change of PIN and reminder over the Internet
15. Blocking of (lost, stolen) cards
Payments, Deposits, Withdrawals, and Transfers

1. Domestic and international fund transfers
2. Micro-payment handling
3. Mobile recharging
4. Commercial payment processing
5. Bill payment processing
6. Peer to Peer payments
7. Withdrawal at banking agent
8. Deposit at banking agent
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Especially for clients in remote locations, it will be important to help them deposit and
withdraw funds at banking agents, i.e., retail and postal outlets that turn cash into electronic
funds and vice versa. The feasibility of such banking agents depends on local regulation which
enables retail outlets to take deposits or not.
A specific sequence of SMS messages will enable the system to verify if the client has sufficient
funds in his or her wallet and authorize a deposit or withdrawal transaction at the agent. When
depositing money, the merchant receives cash and the system credits the client’s bank account
or mobile wallet. In the same way the client can also withdraw money at the merchant: through
exchanging SMS to provide authorization, the merchant hands the client cash and debits the
client’s account.
Investments
1. Portfolio management services
2. Real-time stock quotes
3. Personalized alerts and notifications on security prices
Support
1. Status of requests for credit, including mortgage approval, and insurance coverage
2. Check (cheque) book and card requests
3. Exchange of data messages and email, including complaint submission and tracking
4. ATM Location
Content Services
1. General information such as weather updates, news

2. Loyalty-related offers
3. Location-based services
Based on a survey conducted by Forrester, mobile banking will be attractive mainly to the
younger, more “tech-savvy” customer segment. A third of mobile phone users say that they
may consider performing some kind of financial transaction through their mobile phone. But
most of the users are interested in performing basic transactions such as querying for account
balance and making bill payment.
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One way to classify these services depending on the originator of a service session is the
„Push/Pull”; nature. „Push&’ is when the bank sends out information based upon an agreed set
of rules, for example your banks sends out an alert when your account balance goes below a
threshold level.
„Pull” is when the customer explicitly requests a service or information from the bank, so a
request for your last five transactions statement is a Pull based offering. The other way to
categorize the mobile banking services, by the nature of the service, gives us two kind of
services – Transaction based and Enquiry Based. So a request for your bank statement is an
enquiry based service and a request for your fund transfer to some other account is a transaction
based service. Transaction based services are also differentiated from enquiry based services
in the sense that they require additional security across the channel from the mobile phone to
the banks data servers.
The new generation of mobile phones offers the speedy GPRS, EDGE or 4G data transmission
standards and has large, high-definition colour displays. Prices are coming down and services
and features are now considerably easier to handle on the mobile. Mobile Banking, in
particular, has finally become a fast, user-friendly and affordable service. India’s leading
telecom companies started their services for Mobile Banking, basically they use these services
as a marketing tool to advertise there services on this basis. Here are few giants of telecom
industries in India who are offering Mobile Banking in various states.
1.3.4. ORIGIN AND POTENTIAL OF MOBILE BANKING

IN INDIA
Recognizing the potential of mobile banking, Reserve Bank of India issued the first set of
guidelines in October 2008. The guidelines defined mobile banking as undertaking banking
transactions using mobile phones by bank customers that would involve credit/debits to their
accounts. This definition in a sense provided larger canvas to mobile payments which in a
narrow sense involved only payment made for a product or service using the mobile phone
either remotely or at the Point Of Sale (POS). These guidelines, which were very broad based,
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laid down the technology and security standards pertaining to safety, confidentiality, integrity,
authenticity and non-reputability. As this was a nascent technology and, to build up customer
confidence in terms of minimizing frauds, the Reserve Bank mandated that all transactions
should be encrypted irrespective of the value. The Reserve Bank also made inter-operability a
cornerstone of its policy. After the initial set of guidelines, several policy relaxations have been
made to further encourage the use of mobile banking taking into account changing economic
environment and feedback of the industry and customers. The growth in mobile banking that
has taken place in the country till date, though has been rapid, is yet to reach the critical mass
that will enable it to deliver on its promise of reaching banking including payment services at
a cheaper, secure and seamless manner to the existing and potential customers. It has the
potential to be the next wave of financial and technological innovation in banking by
universalizing access to banking service without jeopardizing prudential and regulatory
framework of the financial sector.
1.4. MOBILE BANKING IN WORLD
Mobile banking is used in many parts of the world with an exception of remote and rural areas
with little or no infrastructure. This aspect is also popular in countries where most of their
population is unbanked. In most of these places, banks can only be found in big cities, and
customers have to journey hundreds of miles to the nearest bank. Hence, Numbers of cities
have introduced such kind of services. In Iran, banks such as Parsian, Tejarat, Mellat, Saderat,
Sepah, Edbi and Bankmelli offer the service. Banco Industrial provides the service in
Guatemala. Citizens of Mexico can access mobile banking with Omnilife, Bancomer and M
Power Venture. Kenya’s Safaricom has the M-Pesa Service, which is mainly used to transfer
limited amounts of money, but increasingly used to pay utility bills as well. In 2009, Zain
launched their own mobile money transfer business, known as ZAP, in Kenya and other
African countries. In Somalia, the many telecom companies provide mobile banking, the most
prominent being Hormuud Telecom and its ZAAD service. Telenor Pakistan has also launched
a mobile banking solution, in coordination with Taameer Bank, under the label Easy Paisa,
which was begun in Q4 2009.
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3. TECHNOLOGIES ENABLING MOBILE BANKING
Technically speaking most of these services can be deployed using more than one channel.
Presently, Mobile Banking is being deployed using mobile applications developed on one of
the following channels.
• Mobile Banking over Wireless Application Protocol (WAP)

• Mobile Banking over SMS (also known as SMS Banking)
• Mobile Banking over Unstructured Supplementary Service Data (USSD)
These mobile banking services have been discussed in detail here:
Mobile Banking over WAP
The customers can download the mobile application of the concerned bank on their
smartphones and then use it to avail various services provided by the bank. They need to
register for mobile banking separately and receive their login credentials to use mobile banking
applications, simply known as mobile apps. Most banks provide mobile apps for iOS and
Android devices.
Different banks offer mobile apps to their customers to help them carry out common banking
transactions conveniently. Some banks offer different mobile apps for different banking
services. For instance, the bank may offer an e-Passbook app that only serves the purpose of
account balance check since the app acts like a digital passbook and there is another mobile
app for other services such as funds transfer, bill payment, and more in addition to balance
check. The customers can choose to download one or more apps provided by the bank to avail
mobile banking services.
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• Account Access: Customers can easily access their bank account using their
smartphones by downloading the mobile banking All they need is to use their User ID and
password to access their accounts. They can then carry out different banking transactions
instantly.
• Balance Enquiry: One of the main reasons why people used to visit the bank was to
keep their passbooks updated so that they always knew their current balance. When the balance
enquiry service was offered through ATM, people started using it instead of visiting the bank.
Now, it is even more convenient to check account balance using the mobile banking.
• E-Passbook: Some banks offer a separate digital passbook mobile app that customers
can download to check their previous transactions and the latest account balance while others
just have this service, as a part of their main mobile banking there is no need to visit a bank or
ATM for balance enquiry or account statement.
• Account Statement: If you want to check your bank account statement, you no longer
need to go to the bank or ATM since you can get the statement on the mobile app of your bank.
Since there are only a few free ATM transactions available to everyone these days, it is better
to avail them only for cash withdrawal; account balance or account statement should be
checked using the mobile app. You can also download your account statement in PDF format
and save it on your phone.
• Fund Transfer: If internet banking and mobile banking have made the lives of people
any easier, it is mainly because of this service. People can now transfer money from their bank
account to an account in their own bank or another bank easily. They may have to pay a nominal
charge to carry out interbank transfers but intra-bank transfers are usually free. IMPS, NEFT
or RTGS transactions can also be carried out easily using mobile apps.
• Bill Payment: Mobile banking has made it easy to pay your mobile, credit card or
utility bills. You can even schedule payments on a certain day of the month so that you do not
have to worry about the payments. There is no need to stand in long queues to pay your phone
bills, credit card bills, etc.
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• Branch Locator: If you are in a new city or area, you may need to find a branch of
your bank then you can easily use the mobile banking app to find it. Most banks have a ‘Branch
Locator’ that you can use to find the nearest branch.
• ATM Locator: When you are in a new city or area, you might want to withdraw cash
from an ATM. The easiest way to find an ATM of your bank is to open your mobile banking
app and go to the “ATM Locator.” You will be able to find the address and exact location of
the ATM within your vicinity.
• Requests: There is no need to visit the bank to request a cheque book, new debit card,
credit card, duplicate debit card, etc. since you can do so easily using the mobile app. Most
banks also offer the service to hotlist or block a debit or credit card in the case of loss or theft.
Mobile Banking over SMS
Most banks offer mobile banking services over SMS. The customers need to sign up for this
service, known as SMS Banking, by registering their mobile number. Then, they can send SMS
to the bank to inquire about their account balance, check the mini account statement, etc. The
bank then replies with an SMS that contains the information requested by the customer. The
customers do not need to own smartphone or internet access to avail SMS banking services.
Banks have a specific phone number registered and an SMS format that the customers need to
follow to avail of this service. For instance, to check the available balance in their account, they
may have to send an SMS in the format: AVAIL BAL XXXX where XXXX is the last 4 digits
of the account number. The bank replies with an SMS with the current available balance in the
account. It is important to note here that the mobile number registered with the bank and the
one you use to send the SMS needs to be same to avail this service.
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Mobile Banking over USSD
Banks offer mobile banking over USSD service to people who do not own a smartphone or
have access to the internet. They can simply use USSD codes provided by the banks to avail
banking services. The customers dial a prefix code and click send. Then, they receive a menu
containing the banking services such as balance enquiry, mini account statement, etc. that they
can avail using their phone. This service is quite popular in rural areas where most people do
not own smartphones and do not have access to the internet.
The generic definition of mobile banking involving credit/debit to the account of the customer-
using mobile has been customized in India to provide two rather unique services. These are the
Inter-bank Mobile Payment System (IMPS) and the Mobile linked Kisan Credit Card (m-
KCC).
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4. ADVANTAGES & DISADVANTAGES OF MOBILE BANKING
ADVANTAGES OF MOBILE BANKING
• Time saving: Instead of allocating time to walk into a bank, you can check account
balances, schedule and receive payments, transfer money and organise your accounts
when you’re on the go.
• Convenient : The ability to access bank accounts, make payments, and even track
investments regardless of where you are can be a big advantage Do your banking
at a time and place that suits you, instead of waiting in queues.
• Secure : Generally, good mobile banking apps have a security guarantee or send
you a SMS verification code you need to input to authorize a payment for added
security. Mobile banking is said to be even more secure than online/internet banking.
• Easy access to your finances: with the introduction of mobile banking, you are
able to access your financial information even beyond the working hours. It helps to
avail banking services even by making a call to the bank.
• Increased efficiency: mobile banking functions are functional, efficient and

competitive. It also helps in decongesting the banking halls and reduces the amount of
paperwork for both the banker and the customer.
• Fraud reduction: one very real advantage to implementing mobile banking.

“Customers are being deputized in real time to watch their accounts.
• It utilizes the mobile connectivity of telecom operators and therefore does not require
an internet connection.
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• You can check your account balance, review recent transaction, transfer funds, pay
bills, locate ATMs, deposit cheques, manage investments, etc.
• Mobile banking is available round the clock 24/7/365, it is easy and convenient and
an ideal choice for accessing financial services for most mobile phone owners in the
rural areas.
DISADVANTAGES OF MOBILE BANKING
Mobile banking users are at risk of receiving fake SMS messages and scams.
• The loss of a person’s mobile device often means that criminals can gain access to
your mobile banking PIN and other sensitive information.
• Modern mobile devices like Smartphone and tablets are better suited for mobile
banking than old models of mobile phones and devices.
• Regular users of mobile banking over time can accumulate significant charges from
their banks.
• Even though there are 1.5 billion computers on the Internet and 4.5 billion people
using mobile phones, there’s currently no significant operating system supporting the mobile
space. “Hackers want to do the least amount of work for the biggest gain.
• Most mobile banking apps need an internet connection to be able to operate, so if you
live in a rural area or experience problems with your internet connection, then you won’t be
able to access your account. The same applies if your mobile phone runs out of battery.
• Many phones aren’t yet compatible with anti-virus software. Most cell phones don’t
come standard with anti-virus protection even if they have the capacity to browse the internet.
Some phones aren’t even compatible with the anti-virus software available and there are
known cases in which people were unable to put anti-virus software registered to them on
corporate cell phones. Although identity thieves are still a few steps behind when it comes to
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learning to implement some of their most successful computer tricks (phishing, spamming,
spreading viruses, account hacking, etc…) on a cell phone level, experts agree that is only a
matter of time and people shouldn’t assume that anti-virus software isn’t necessary for cell
phones.
• Some banks don’t offer the same level of protection for cell phone banking that they
do for online or in person transactions. Because the risks are still generally unknown some
banks have been slow to make promises about what will or will not be covered when you use
cell phone banking.
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5. FEATURES OF MOBILE BANKING

(MOBILE PAYMENT CHARACTERISTICS)
FEATURES
A mobile payment service in order to become acceptable in the market as a mode of payment
the following conditions have to be met:
• Simplicity and Usability: The m-payment application must be user friendly with little or
no learning curve to the customer. The customer must also be able to personalize the
application to suit his or her convenience.
• Universality: M-payments service must provide for transactions between one customer to
another customer (C2C), or from a business to a customer (B2C) or between businesses
(B2B). The coverage should include domestic, regional and global environments. Payments
must be possible in terms of both low value micro-payments and high value macro-payments.
• Interoperability: Development should be based on standards and open technologies that

allow one implemented system to interact with other systems.
• Security, Privacy and Trust: A customer must be able to trust a mobile payment
application provider that his or her credit or debit card information may not be misused.
Secondly, when these transactions become recorded customer privacy should not be lost in
the sense that the credit histories and spending patterns of the customer should not be openly
available for public scrutiny. Mobile payments have to be as anonymous as cash transactions.
Third, the system should be foolproof, resistant to attacks from hackers and terrorists. This
may be provided using public key infrastructure security, biometrics and passwords
integrated into the mobile payment solution architectures.
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• Cost: The m-payments should not be costlier than existing payment mechanisms to the
extent possible. A m-payment solution should compete with other modes of payment in terms
of cost and convenience.
• Speed: The speed at which m-payments are executed must be acceptable to customers and
merchants.
• Cross border payments: To become widely accepted the m-payment application must
be available globally, word-wide.
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6. CHALLENGES OF MOBILE BANKING
CHALLENGES
Key challenges in developing a sophisticated mobile banking

application are:
1. Handset Operability
There are a large number of different mobile phone devices and it is a big challenge for banks
to offer mobile banking solution on any type of device. Some of these devices support Java
ME and others support SIM Application Toolkit, a WAP browser, or only SMS. Initial
interoperability issues however have been localized, with countries like India using portals
like R-World to enable the limitations of lowend java based phones, while focus on areas
such as South Africa have defaulted to the USSD as a basis of communication achievable
with any phone. The desire for interoperability is largely dependent on the banks themselves,
where installed applications (Java based or native) provide better security, are easier to use
and allow development of more complex capabilities similar to those of internet banking
while SMS can provide the basics but becomes difficult to operate with more complex
transactions. There is a myth that there is a challenge of interoperability between mobile
banking applications due to perceived lack of common technology standards for mobile
banking. In practice it is too early in the service lifecycle for interoperability to be addressed
within an individual country, as very few countries have more than one mobile banking
service provider. In practice, banking interfaces are well defined and money movements
between banks follow the IS0-8583 standard. As mobile banking matures, money movements
between service providers will naturally adopt the same standards as in the banking world.
On January 2009, Mobile Marketing Association (MMA) Banking Sub-Committee, chaired
by Cell Trust and VeriSign Inc., published the Mobile Banking Overview for financial
institutions in which it discussed the advantages and disadvantages of Mobile Channel
Platforms such as Short Message Services (SMS), Mobile Web, Mobile Client Applications,
SMS with Mobile Web and Secure SMS.
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2. Security
Security of financial transactions, being executed from some remote location and
transmission of financial information over the air, are the most complicated challenges that
need to be addressed jointly by mobile application developers, wireless network service
providers and the banks' IT departments. The following aspects need to be addressed to offer
a secure infrastructure for financial transaction over wireless network:
A. Physical part of the hand-held device. If the bank is offering smart-card based security,
the physical security of the device is more important.
B. Security of any thick-client application running on the device. In case the device is
stolen, the hacker should require at least an ID/Password to access the application.
C. Authentication of the device with service provider before initiating a transaction. This
would ensure that unauthorized devices are not connected to perform financial
transactions.
D. User ID / Password authentication of bank’s customer.
E. Encryption of the data being transmitted over the air.
F. Encryption of the data that will be stored in device for later / off-line analysis by the
customer.
One-Time Password (OTPs) are the latest tool used by financial and banking service
providers in the fight against cyber fraud. Instead of relying on traditional memorized
passwords, OTPs are requested by consumers each time they want to perform transactions
using the online or mobile banking interface. When the request is received the password is
sent to the consumer’s phone via SMS. The password is expired once it has been used or once
its scheduled life-cycle has expired. Because of the concerns made explicit above, it is
extremely important that SMS gateway providers can provide a decent quality of service for
banks and financial institutions in regards to SMS services. Therefore, the provision of
Service Level Agreements (SLAs) is a requirement for this industry; it is necessary to give
the bank customer delivery guarantees of all messages, as well as measurements on the speed
of delivery, throughput, etc. SLAs give the service parameters in which a messaging solution
is guaranteed to perform.
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3. Scalability And Reliability
Another challenge for the CIOs and CTOs of the banks is to scale-up the mobile banking
infrastructure to handle exponential growth of the customer base. With mobile banking, the
customer may be sitting in any part of the world (true anytime, anywhere banking) and hence
banks need to ensure that the systems are up and running in a true 24 x 7 fashion. As
customers will find mobile banking more and more useful, their expectations from the
solution will increase. Banks unable to meet the performance and reliability expectations may
lose customer confidence. There are systems such as Mobile Transaction Platform which
allow quick and secure mobile enabling of various banking services. Recently in India there
has been a phenomenal growth in the use of Mobile Banking applications, with leading banks
adopting Mobile Transaction Platform and the Central Bank publishing guidelines for mobile
banking operations.
4. Application Distribution
Due to the nature of the connectivity between bank and its customers, it would be impractical
to expect customers to regularly visit banks or connect to a web site for regular upgrade of
their mobile banking application. It will be expected that the mobile application itself check
the upgrades and updates and download necessary patches (so called "Over The Air"
updates). However, there could be many issues to implement this approach such as upgrade /
synchronization of other dependent components.
5. Personalization
It would be expected from the mobile application to support personalization such as:
Preferred Language, Date / Time format, Amount format, Default transactions, Standard
Beneficiary list, Alerts.
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7. FUTURE PROSPECTS OF MOBILE BANKING
There are various factors, drivers that will empower Indian mobile banking to grow
exponentially in the coming years.
A. Under-banked and Un-Banked Population
Out of 600,000 villages in India only one sixth, have banking services. Almost half of the
country’s population is unbanked. The large section of the Indian population not just in rural
areas but also in many segments of urban markets, offers a large untapped market with a
tremendous business potential. Financial inclusion is slowly but surely being seen not just as
a social responsibility, but as a potential business model too, for two reasons.
Firstly, the RBI is looking for real business cases and forcing banks for the same and
secondly, because of the huge untapped market for banking services.
B. Demographic Factors
In India the population of youth (between the ages of 14-29) is the largest youth population
globally, which is around 27% of the total 1.2 billion. Furthermore, adding the age group of
30-44, the proportion is 47%. %. Apart from the huge size of this segment, they are among
those who are the early adopters of latest technology and new services, which presents a huge
opportunity for e/m-banking service providers. It has been observed that for the majority,
access to financial services is a household need, and not only an individual need, and if the
account holder is illiterate, other members of the family are competent enough to execute
transactions and use electronic or mobile banking services.
C. Bank Based Services
It has been observed that poor people, whether in urban or rural completely understand the
need for formal financial services and are well aware of the fact that they are losing money in
the informal sector and whenever they leave money in the household. Many low-income
households also express a clear need for credit facilities – but 51% remain dependent on
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informal sector (other sources) moneylenders. Similarly, they are very aware of the
drawbacks and costs of informal remittance schemes, and are to send money to family and
friends.
For doing one transaction from a bank, a poor has to incur significant direct and opportunity
cost. The direct cost associated with traveling to a bank branch is not insignificant. They have
to incur about Rs.20 and opportunity costs of wage labour range from Rs.50 to Rs.150 and
sometimes more. As a result, there is growing willingness to conduct transactions through
agents and to pay for these services. Majority of villagers are willing to pay for services that
will reduce their real and opportunity costs.
India continues to be a unique market and regulatory environment with intense involvement
of the regulator and the government. Hopefully, the rapid outreach will make the model
sustainable for all the players, banks, BCNMs and agents and at the same time offer services
really needed by the clients. These two ends are, of course, aligned and mutually beneficial.
The gradual regulatory evolution to support BCs and banks in their outreach efforts
continues– and the results are beginning to emerge.
The other exciting development is the move to encourage banks to have 25% of their
branches in rural areas. These, presumably low cost branches, can become the hub for
financial inclusion and support wider outreach of branchless banking outlets, while acting as
nodes or hubs of the model. The antiquated post-office structure is also undergoing rapid
transformation and all records will be computerized with plans to link post-offices within the
next year.
Many of the lessons learned in the past can very well be applied by the banking sector. With
government goading, the banks in India will soon recognize and respond to this.
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8. TOP 10 MOBILE BANKING APPLICATIONS IN INDIA
1. ICICI iMobile Application
ICICI Bank’s iMobile application provides a comprehensive and secure platform for users
with over 250 financial as well as non-financial services. This app functions to take care of
the daily banking requirements from the smartphone.
ICICI iMobile app is available on both Android and iOS. As compared to other mobile
banking apps, iMobile has the highest rating on Google Play Store which makes it the top-
rated mobile banking app.
2. HDFC Mobile Banking App
HDFC Bank Mobile Banking Application offers an easy, secure and convenient platform for
over 120+ banking transactions from anywhere and anytime. The app is equipped with
advanced encryption and security to keep your account safe.
You can also recharge your mobile, make DTH payments, pay bills and credit card dues with
HDFC Mobile Banking App. Instant money transfers, Demat portfolio management, UPI
payments can also be catered with mobile banking.
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3. State Bank of India YONO App
SBI YONO (You Only Need One App) fulfils all the banking, insurance, investment and
daily shopping requirements of its users. With this one app, users can bank, shop, travel, pay
bills, recharge, invest, etc. conveniently. It also allows users to apply for SBI cards, make
card payments, view transaction history and is suitable for international usage as well.
4. Bank of Baroda M-Connect Plus App
M-Connect Plus App by Bank of Baroda is a feature-loaded mobile banking app where users
can access a wide range of banking products from balance enquiry to cardless cash
withdrawals. All the services provided by the app are free of charge. One-time SMS charge is
applied at the time of activation. Fund transfer facility is also provided under this app using
IMPS/NEFT.
It has a simple and easy to use interface and activation process. Users can auto-link all their
savings, current, CC, OD, Loan, PPF accounts with one customer ID.
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5. Axis Mobile App
Axis Bank’s Axis Mobile App is a safe and secure mobile banking platform which offers
more than 100 services to its users for almost all banking requirements. It is one of the most
popular and efficient mobile banking applications with convenient access to bank accounts,
fund transfers, bill payments, UPI payments, and a lot more.
6. Kotak- 811 & Mobile Banking App
Kotak Bank has released its upgraded version of mobile banking in the form of Kotak- 811 &
Mobile Banking App. Using this app, Kotak account holders can open a new zero balance
811 savings account in just 5 minutes. Besides this, the app provides almost all the banking
services including transfer and payments, account balance check, bill payment and recharges,
investments, credit card issuance, Demat account access, and much more.
7. IDBI Go Mobile+ App
IDBI Go Mobile+ App enhances the consumer’s banking experience with a simple,
customizable interface providing a wide range of features and services. Mobile banking
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allows users to access several banking services anytime and anywhere. IDBI customers can
register and login to IDBI Go Mobile+ app and view account statements, remittance, transfer
funds, make bill payments, etc. Moreover, one can also make utility bill payments or recharge
prepaid mobile using this app.
The bank has equipped the app with sophisticated encryption technology to secure data
transfer from your mobile phone to the Bank’s mobile banking server.
8. CANDI- Mobile Banking App
Canara Bank’s CANDI- Mobile Banking App is launched by the bank under the bigger
objective of implementing ‘One Bank, One App’. It is a multi-channel application which
supports most of the banking services including fund transfer, opening a fixed deposit or
recurring deposit, EMI payments, loan payments, and a lot more.
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9. PNB ONE Mobile Banking App
PNB ONE is a unified mobile banking app stacked with several banking products and
services. It enables the PNB account holders to perform major banking transactions anytime
and anywhere without having to visit the branch. The bank has used biometric authentication
along with MPIN to secure the application.
10. HDFC PayZapp
HDFC PayZapp is a payment application using which one can send money, pay for shopping
in a click, transfer funds, make bill payments, etc. The best part about PayZapp is that it
offers rewards, coupons and discounts on online shopping websites and a lot more.
Using this payment app by HDFC, you can shop on your mobile at partner apps, buy movie
tickets, groceries, compare and book flight tickets and hotels, shop online and get great
discounts at SmartBuy. HDFC account holders can link their debit/credit cards with PayZapp
for a convenient experience.
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9. IMPACT OF COVID-19 ON MOBILE BANKING
M-banking will be the new normal to many industries and businesses after COVID -19. It is
very challenging for many countries as it was in 2008 crisis, we need to accept the digital
change and innovate the way of transaction with the new M-banking application that
emerging Fintech company serves. Banks need to build the trust, create the digital and safe
environment for digital banks, make customers aware with the helpful use of it.
Due to shut down there was very less physical transaction done as it was not safe to withdraw
money and even for banks to accept deposits. RBI report says, ATMs stood at over 91% of
their full capacity which means there was need to refill the cash in 91% of machines.
Slowdown in the deposits grew up to 7.98%. According to RBI, 15.5 lakh crore of
outstanding debt in the market has been affected, retail and wholesale trading were hault,
more than 19 Sectors were affected. Top five affected sector were port and services, aviation,
construction, mining and mineral, retailing done by corporate all sectors affect banking at
very high rate.
We are living in a digital world and India being a developing country here banks had a very
advantage of promoting mobile banking, although India is having online banking internet
infrastructure since very long but it was adopted by majority of customers that bank managed
with them. Banks are now supporting customers guiding them personally for their needs.
Many people who were reluctant to move to mobile banking application are now considering
the shift as an easy mode. Mr. Niraj Mittal says, there has more 29% more transaction in Q1
2020 from Q1 2019 as corporate and retailer have higher issuance rate from bank accounts to
mobile wallets.
Developing countries like India are very beneficial as more and more Fintech company are
investing in banks and with the help of their internet infrastructure and technology banks will
be able to serve customers with better facility and more secured transactions. In this new
normal period, we are experiencing a new network environment where everything is
available on our fingertips. We are seeing much faster and reliable transaction pattern.
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Mobile banking has brought a very significant increase in number of users after lockdown as
mobile application has been more customized and made more user friendly like Paytm, Yono
(SBI), PayZapp and many more.
M-banking volume of transactions in Jan 2020 was 14,402.70 lakh and in June it shooted up
to 16,188 lakh volume of transaction. (Source: RBI Combining all 354 banks of India
recognized by RBI of Public and Private sector) there is an increase in amount of Rs.7801.31
lakhs from pre-COVID and during COVID which is June 2020.
A report from PWC predicts that, the overall conversion rate of customer from offline to
online will increase at greater speed. The acquiring of money will 100% happen through
payment gateways and companies like Razor pay and Paypal will offer to tie up small stores
to increase their volume of transaction, as all the daily necessity transaction are only
happening online with help of m-banks. It will also help to build more stronger payment
infrastructure that is more secured and reliable in means of transfer and transaction. UPI,
IMPS and BBPS has shown more than 50% increase in number of transactions. M- banking
has made our lives easier to meet our daily requirement and for MSME immediate fund
transfers in just a matter of 5 minutes.
India is the second largest base for internet users. We can depict that from 2015 the number
of users having mobile internet is increasing at 16% in the year 2015-16 and so on in further
years.
According to a report by MCKinsey, there will be 40% increase in the internet mobile users.
We can say more and more of internet user are using internet and making use of mobile
internet to use various facilities like, m-banking, social media, utility tools and many more.
Reports by Economics time suggests that inspite of rising cost of internet people are meant to
opt for it as a basic necessity now a days. They say that subscribers to internet will be 835
Million by end of year 2023. Mobile internet usage is increasing at a rate of 152% per annum.
The government promoting Jan Dhan Yojana is a mass financial inclusion programme due to
which the number of banking accounts have doubled in numbers after 2011 and around 80%
of the banks were opened using smart phone and mobile internet.
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India is a country of vast population, there are many smartphone companies. Smartphones
have widely offered various application for mobile bankingand facilitating other digital
services including education, healthcare, financial daily book keeping and many more. The
digital services on smartphones covering various sectors has been very user friendly and
rapidly increasing its reach. According to the report by Economics times Digital banking
services has been playing a very crucial role in response to COVID 19. Studies say that both
rural and urban unfortunately spend (25 –26%) same amount of their budget on smartphones
and to opt it services.
World’s Largest Digital Literacy Programs are run by Indian organization which led people
to adapt new technology. Programs like Pradhan Mantri Grameen Digital Saksharta Abhiyan
(PGMDISHA) and E-Kranti have been promoted with great initiative under the umbrella of
Digital India which provides, M-banking, Digital Agriculture, Healthcare, Education,
Passport and various other services through smartphones. This effort has increased the
number of smart phone base in India after launch of Digital India Programme.
According to a report of Gadget 360 NDTV (Studio, 2020), there has been 15% increase in
the smartphones market after 2018. A study of techARCh, states that in December 2019
almost 77% of Indian were having smartphones and they are using all the wireless services.
There are top brands acquiring 25 to 41% of market by offering different range of
smartphones from budget phone to luxury phone brands. Factors like good quality, budget
friendly and new features attract the customer a lot.
According to RBI Reports, it can be observed that the growth in the number of mobile
banking transactions in the years 2012-2014 have been very minimal. But after the launch of
the Digital India program in the year 2015, there was a sudden increase in the number of
transactions i.e., 386.6mn in 2015-2016, almost double than that of the previous year i.e.,
171.9mn transactions in 2014-2015. Later in the year 2016-2017 mobile banking transactions
grew from 386.6mn transactions in 2015-16 to 976.85mn transactions. The post
demonetization period has shown increasing trends in the number of mobile banking
transactions when compared to the pre demonetization period. It is believed that
demonetization was one of the catalysts for mobile banking in India.
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Followed by the COVID-19 pandemic in India, Mobile Banking transactions in the month of
Jan 2020 were 14,402.70 lakh (1440.27 mn) and in June it shooted up to16,188 lakh volume
of transaction. The total number of transactions from Jan 2020 to June 2020 were 84602
lakhs (8460.2mn) (Source: RBI Combining all 354 banks of India recognized by RBI of
Public and Private sector). Hence COVID-19 is considered as one of the largest catalysts
after demonetization to promote the adoption of mobile banking in India.
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10. RESERVE BANK OF INDIA REGULATION
The following are the Reserve Bank of India (RBI) Guidelines issued to provide Mobile
Banking Service in India:
• Only such banks which are licensed and supervised in India and have a physical
presence in India will be permitted to offer mobile payment services to residents of
India.
• The services should be restricted to only to bank accounts/ credit card accounts in
India which are KYC/AML compliant.
• Only Indian Rupee based services should be provided.
• Banks may use the services of Business Correspondents for extending this facility, to
their customers. The guidelines with regard to use of business correspondent would be as
per the RBI circular on Business correspondents issued from time to time.
• The Risks and Controls in Computers and Telecommunications guidelines will
equally apply to Mobile payments.
• The ―Know Your Customer (KYC)‖ and ―Anti Money Laundering (AML)‖ as
prescribed by RBI from time to time would be applicable to customers opting for mobile
based banking service.
A. Transaction Limits in Mobile Banking
Only Indian rupee transactions and these transactions are allowed within India only.
• Per day transaction cap of Rs.50000 has been removed by RBI, and every bank can
change this cap depending upon their risk
• Transactions without end-to-end encryption is Rs.5000/- (SMS Based)
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B. Security and Authentication
The highlights of security and authentication guidelines provided by the RBI on Mobile
Banking:
• The m-PIN or higher standard of mechanism should be used to authenticate the
Mobile Banking customer.
• End-to-end secure encryption mechanism should be followed in transactions.
• Bank should conduct regular information security audits on the mobile banking
systems to ensure complete security.
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11. OBJECTIVE OF THE STUDY
The overall objective of the study was to examine challenges facing mobile banking services
in reaching customers in INDIA.
Specifically, the study aimed at:
1. To examine, if banks customers are aware of the services offered by banks on mobile
banking.
2. To find-out whether the security & privacy issues of mobile banking is becoming a
barrier in extending their services to many customers.
3. To determine whether the customers are using mobile banking services in their day-to-
day chores.
4. To analyze the future prospects of the m-banking services of the Indian Banking
Industry.
5. To study the challenges faced by Indian banks in adoption of technology and make
recommendations to tackle these challenges.
6. To propose suggestion to improve the Mobile Banking Services based on findings.
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12. SCOPE OF THE STUDY
Based on the literature, the following mobile banking prospects and challenges were
discussed with existing bank customers:
• Mobile compatibility
• Mindset about the mobile banking acceptance
• Availability of facilities
• Security & Privacy issues
• Willingness to adopt mobile banking service in future
• Future trends of mobile banking services
• Standardization
• Challenges facing mobile banking
• Telecom service quality
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13. NEED OF THE STUDY
The need of this study was to find out what exactly causing the problem in adoption and
extension of mobile banking services provided by banks in India.
There are various reasons that are being barriers, such as:
A. Customer Awareness:
Due to lack of knowledge and awareness about mobile banking, it is also a reason for
distrust in mobile banking services and it is also another reason for risk and security issue
in mobile banking, because this is new technology in banking and financial system so all
banking customer are not aware about it and feel risk to adopt it. Therefore, it is also a big
challenge in front of mobile banking services in India.
B. Security Issues & Privacy:
There is security of mobile banking services is big issue and challenge. In mobile banking
for the security purpose PIN or PASSWORD is used which may be steal by the attacker or
unauthorized user if mobile device has loss or steal so user have to aware about it.
Customers use sensitive data and information in mobile so here risk with pass of a
legitimate application because third party it may steal our information and send it to
another third party provides application services. Therefore, we have to be aware about
application used for WAP mobile banking services and download a legitimate and
authorize application for transaction with mobile banking services.
C. Virus & Malware Attack:
There is also risk with virus and malware attack. It may get access to your account
information such as username, password and other information. Like in computer system,
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there is also risk of virus and malware attack on mobile banking services. Some malicious
code are written to defect mobile banking like Zeus has used for attack on SMS banking
and Zeus used for steal mobile transaction authentication such as password and pin
number. So it is also big security issue and challenge in mobile banking services.
D. Wireless Network:
All process of mobile banking services is done in wireless mode, so there is also a security
risk in mobile banking services. Mobile device component contact with cell site and
dedicated circuit or microwave for the communication services so if there is any weakness
in any part of this network then risk of attack is increases, so we have to secure all these
network and network devices for a good security services.
E. Authentication Issue:
In mobile banking there is authentication risk at the login time or when we access our
account through the mobile system, because in mobile banking for the authentication
PINS numbers are used but PINS authentication method is an old method and many
security issues such as password and id theft were by stealing the password and id
unauthorized access may be possible by getting the password attacker may access our
account. Another risk related to authentication in mobile banking as if mobile has stolen
then attacker may get the password through the mobile and can access the account by
using your id and password.
The need of the study is also to find out solutions for these challenges, so that banking
industry can run smoothly and see what the future of mobile banking services in India is.
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14. RESEARCH METHODOLOGY
METHODOLOGY:
Methodology is system of broad principle or rule from which specific methods or procedures
maybe derived to interpret or solve different problems within the scope of particular
discipline.
Methodology is not a formula but a set of practices.
The study was conducted to identify the issues and prospects of mobile banking in India.
Necessary data was collected from different ages of people and analyzed in terms of the
objectives of the study.
There are several ways to collect this basic information. The data for this study was collected
by the survey method. Survey is a research technique in which information is gathered from a
sample of people by use of a questionnaire or interview. It is a method of data collection
based on communication with a representative sample of individuals. The researcher
developed a questionnaire and circulated into among her friends & family to provide details
about their mobile banking services usage, knowledge & issues faced. The survey was
designed in a manner to gain a better understanding of the perspective of customers at both
financial and personal level. This research is based on present study and the findings are
supported by the responses and insights from the sample surveyed.
TYPES OF RESPONDENTS:
This research includes all types of people mostly selected different age and occupation
people.
RESEARCH DESIGN:
Mobile banking is a new technology for people in India. Bank customers normally use
traditional banking system as they trust this system and they are used to it. People are afraid
of using mobile banking because they cannot feel it trust worthy.
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In our country, most of the customers are influenced through advertisements. In recent times,
customers have become more conscious about their savings. Different banks advertise about
mobile banking services to give information about it to all people in the country. This
research study has researched the customer perception on mobile banking based on the above
dimensions. The respondents were approached through questionnaire that was sent to them
on their social media handles. It was felt that the survey will give the correct result. The
research is descriptive in nature, using primary data.
SAMPLE SIZE:
Sample is defined as a subset of the universal population. Sample is small group of
respondents drawn from a population in which the researcher is interested in gaining
information and drawing conclusions. A sample of 60 respondents was selected for study.
SOURCES OF DATA:
During data collection, both primary and secondary data were used for its validity and
reliability as attached in annexures
Primary Data:
This study used primary data that was obtained directly from the field. Data was collected
from the sample population through questionnaire as attached in annexure.
The open and close-ended questions were used in questionnaire for bank customers.
Secondary Data:
Secondary data were used for providing the theoretical background to the research problem.
The secondary data sources were-journal, books, internet etc.
QUESTIONNAIRE TYPE AND RESPONSES:

The questionnaire was starting with some introductory questions such as name, age,
Occupation & education. These questions provide the basic information about the
respondents. These types of question make respondents comfortable to respond the study.
There are 15 questions in this questionnaire. The respondents were asked the questions to
know their knowledge and perception about mobile banking like “Have you ever heard about
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mobile banking?”, “Do you think you should use it?”, “Do you think mobile banking services
are trust worthy?” etc.
DATA COLLECTION AND ACCURACY OF DATA:

Generally, most of the people are not interested to give time to answer a questionnaire.
Therefore, it was very difficult to collect actual data because the information of the
respondents was collected by approaching them to answer on social media and not face to
face. To overcome this problem, all possible efforts were made by the researcher herself to
ensure the collection of reasonably accurate information from the respondents. Therefore, it
has not been possible to apply any other method of investigation. Survey method has the
advantage that it facilitates quick investigation and involves lower cost. In order to collect
relevant information before taking data, the whole academic purpose of the study was clearly
explained and made clear to the respondents. Data collected was checked and verified for
accuracy and consistency.
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15. HYPOTHESIS OF THE STUDY
With an objective to know about the Mobile banking in India, reviews of literature have been
done.
However, the related published literature on the area of study is quite meagre.
Hence, the following hypotheses are framed:
HYPOTHESIS 1:
NULL HYPOTHESIS (H0): There is no significant association between age of the

respondents and their opinion about mobile banking services.
ALTERNATIVE HYPOTHSIS (H1): There is a significant association between age

of the respondents and their opinion about mobile banking services.
HYPOTHESIS 2:
NULL HYPOTHESIS (H0): There is no significant association between educational

qualification of the respondents and their opinion about mobile banking services
ALTERNATIVE HYPOTHSIS (H1): There is a significant association between

educational qualification of the respondents and their opinion about mobile banking services
HYPOTHESIS 3:
NULL HYPOTHESIS (H0): Customer awareness and illiteracy is not a significant

issue in mobile banking.
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ALTERNATIVE HYPOTHSIS (H1): Customer awareness and illiteracy is a

significant issue in mobile banking.
HYPOTHESIS 4:
NULL HYPOTHESIS (H0): Security and privacy is not a significant issue in

extending mobile banking services.
ALTERNATIVE HYPOTHSIS (H1): Security and privacy is a significant issue in

extending mobile banking services.
HYPOTHESIS 5:
NULL HYPOTHESIS (H0): Banking customers are not using mobile banking in their
routine life.
ALTERNATIVE HYPOTHSIS (H1): Banking customers are using mobile banking

in their routine life.
HYPOTHESIS 6:
NULL HYPOTHESIS (H0): There is negative prospect for mobile banking in India.
ALTERNATE HYPOTHESIS (H1): These is positive prospect for mobile banking

in India.
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16. LIMITATIONS OF THE STUDY
The researcher had to face the following problems in collecting data from the respondents.
Usually, most of the respondents have not enough idea about mobile banking. Therefore, it
was very difficult to collect actual data. Because the information of the respondents was
supplied from their idea.
Most of the respondents do not fully use mobile banking which caused another problem to
data collection to the researcher.
Sometimes respondent could not answer to questions accurately and to the point.
In addition, it was difficult to get required information. Some respondents treated their
information as confidential and therefore, it was difficult to have access to them. However,
the respondents were assured that the required data were just merely for the academic
research work and not otherwise.
Some respondents choose to provide wrong information during the primary data collection.
They took this questionnaire just for fun. However, to solve this problem, respondents were
informed about the objectives of the study and that motivated them to provide required
information, which convinced them to provide valid information.
The respondents were usually busy with their work. Therefore, the researcher had to wait
longer than usual to get the data.
Despite of all the challenges, the quality of the data is not compromised and it is noted that
the mobile banking has a bright future.
There is a wider scope for the researchers to analyses other digitalized services also like
plastic money, online transactions and mobile commerce facility provided by the banks.
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17. REVIEW LITERATURE
Scornavacca and Barnes (2004) suggest that recent innovations in telecommunications

have enabled the launch of new access methods for banking services, one of these is mobile
banking; whereby a customer interacts with a bank via a mobile device such as a mobile
phone or personal digital assistant.
Rugimbana (1995) found that there is vast market potential for mobile banking due to its
always-on functionality and the option to do banking virtually any time and anywhere.
Unnithan and Swatman (2001) studied the drivers for change in the evolution of the banking
sector, and the move towards electronic banking including mobile banking by focusing on
two economies, Australia & India and suggested strong growth potential of new banking
channel in India.
Clark (2008) suggests that as a Channel the mobile phone can augment the number of
channels available to consumers, thereby giving consumers more low-cost self-service
options by which to access funds, banking information and make payments.
Rao (2003) suggest banks will need to expand their thinking about mobile banking beyond
online banking and should start to view mobility as its own powerful and compelling delivery
channel that can help them deliver to end users new value such as immediate access and
additional control of personal finances.
According to Vyas (2009), Banks will target non-online banking users who may lack regular
access to desktop Internet but are very likely to own a mobile device.
Gupta (1999); Pegu (2000); Dasgupta (2002) also affirms future of mobile banking in India in
their studies.
Suoranta (2003) found that the average mobile banking user is married, 25 to 34 years old,
has intermediate education and average income in clerical work. She found that age and
education have a major influence on the use of the mobile phone in banking services. The
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adoption theories assume that use of Internet banking precedes the adoption of the mobile
phone in banking. However, found that some mobile banking customers omit Internet
banking adoption when adopting the mobile phone for banking actions.
Polatoglu (2001); Al-Ashban and Burney (2001); Karjaluoto (2002); Black (2002)supports
findings of Suoranta in their respective studies.
Mas (2008); Lyman (2008) found that there are a large number of different mobile phone
devices and it is a big challenge for banks to offer mobile banking solution on any type of
device. Some of these devices support J2ME and others support WAP browser or only SMS;
presetting a serious challenge.
Hayat (2009) suggests that for a banking regulator it is important to provide adequate
protection for consumers, ensure economic stability, provide interoperability of electronic
systems and guarantee security of transactions and Anti-Money Laundering and Know-Your-
Customer principles must also be applied to mobile payments.
Comninos (2008) suggest that unbanked will only transact electronically (online/mobile
banking) if there is convenience and security.
Sharma and Singh (2009) found that Indian mobile banking users are specially concern with
security issues like financial frauds, account misuse and user friendliness issue-difficulty in
remembering the different codes for different types of transaction, application software
installation & updation due to lack of standardization.
Banzal (2010) found that another major issue is the revenue sharing agreements between
mobile service providers, banks, content providers, aggregators and other service providers
like utilities, travel agencies, hotel industry, retailers etc.
Uppal R.K, 2010,”Emerging Issues and Strategies to Enhance M-Banking Services”, The
study highlights the benefits of M-banking for customers and bankers and also focused that
M-banking is the best choice in all aspects in this competitive world. Study suggests many
plans of action with their possible solution like providing proper training session to the
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bankers, transparency towards customers, wider the range of awareness among rural people
regarding m-banking services in India, along with semi-urban areas too.
Uppal R.K, 2011,”Mobile Banking in India: An empirical Analysis”, based on acceptance

and handling of m-banking services among Indian banking sector and customers. The study
includes various challenges and problems while using m –banking services like high cost, in
security and poor data transmission during transaction. These problems faced by customer,
force them not to prefer m-banking.
Rangan, V. Kasturi and Lee, Katharine L., (2012),“Mobile banking for the Unbanked”
studied a case of two Mobile banking operators , M-PESA in Kenya and WIZZIT in South
Africa. The market for the unbanked is explored. Questions are raised regarding settings and
the convenience of the model to other countries.
Deva Devan (2013), “Mobile banking in India – Issues and Challenges” identifies and
analyses the security issues faced by Mobile banking customers in India. The findings show
that majority of the respondents are using ATM and online banking facility. However around
¼ customers are adopting Mobile banking services and rest 3/4 are not adopting it.. The rapid
development in Internet facility like broadband speed has become major obstacle for
customers and banks. It is revealed in the study that customers also feel uncomfortable to use
mobile services as in case lost or theft of mobile handset, chances of misuse in Mobile
banking services are there by any other person.
Nitin,Vikas and Nancy(2014), “A study of adoption behavior of Mobile banking services by

Indian Consumers” emphasized the factors that persuade the behavior of Indian consumers
while using Mobile banking services . The above mentioned study suggests that the
significant factors determine the influence on the adoption of mobile banking services are
namely trust, perceived cost and perceived ease of using mobile banking. The various
marketing activities like door to door campaign, advertisements, fares, displays through
demos and hoardings create a mass awareness amongst the public. The study reveals that
understanding and easiness in operation motivate the customers to adopt Mobile banking.
Singh Shamser (2014), “The Impact and Adoption of Mobile banking in Delhi” focuses the
adoption pattern of Mobile banking and its impact on customers of different banks in Delhi.
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ANOVA test and Factor Analysis are used on 200 customers. On the basis understanding of
customer’s perception regarding Mobile banking, five different and important factors were
identified- Security/Privacy, Reliability, Efficiency, and Responsiveness. The study
concluded that the customers’ perceptions are effected by demographic factors as well.
Cudjoe, Anim.
Nyanyofio (2015), “Determinants of Mobile banking Adoption in the Ghanaian Banking

Industry: A Case of Access Bank Ghana Limited” studies the adoption behavior of Mobile
banking, with specific among bank customers in Ghana. It assesses the determinants of
Mobile banking, with specific emphasis on Access Bank. The results indicate that there is a
significant effect by each factor which is measured in the study, on the intent of customers to
take up and use Mobile banking services offered by Access Bank. The study further revealed
that the factors responsible for a negative behavioral pattern towards mobile banking are
perceived financial cost and perceived credibility of the customers.
Anyanwu,.Ubi, &Ananwude, (2017), “Trust and Distrust Determinants of Mobile Banking

Adoption in the Nigerian Banking Industry: A Study of First Bank Nigeria Limited”,
analyzed that perceived benefits and ease of use are also important factors for mobile
banking. The study highlights that perceived benefit and effortlessness of use of Mobile
service extensively influence and decide the behavioral intent of customers to accept mobile
banking. The finding of the study is that perceived risk and monetary cost restricts customers
from adopting mobile banking.
Mbama, & Ezepue, (2018),” Digital banking, customer experience and bank financial
performance: UK customers’perceptions”, studies that customers’ satisfaction has positive
relationship with the use of mobile banking. In this regard, it could be inferred that there are
numerous factors which influences the customers’ approach towards availing mobile banking
services. The study revealed that the major impact is ascertained through available quality
of services provided, perception regarding value of services and the risk related to it.
Employee employer relationship is another parameter which is an important determinant.
Further, all the above mentioned factors relate to customer experience which leads to
satisfaction and experience.
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18. DATA ANALYSIS
Here we discuss presentation of findings and discussions. Several statistical and analytical
methods and tools were used for analyzing the gathered data from the survey. Tables, graphs
and column charts have been used as graphical tools to show analysis of data.
The questionnaire was about background characteristics of the respondents, knowledge of bank
customers on the services offered by banks on mobile banking, challenges facing mobile
banking services in extending their services to more customers and the perspective of
respondents about mobile banking future.
CHARACTERISTICS OF THE RESPONDENTS
The characteristics of the respondents were sought in order to determine various aspects
challenging m-banking services in reaching customers in India. These include age, level of the
education and occupation background of respondents.
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1. Age of the Respondents
The results show that out of 50 respondents 49% were the age between 26 and 35. This was
due to the fact the age comprises of many people and adult who are likely to be early
technology adopters.
The age of respondents majorly lies in between 26-35 followed by 18-25 group of
respondent. Respondents above the age of 50 hardly use mobile banking. The majority of
the users belonging to the group of 18-35 either are students or working class. They
frequently use mobile banking to order food, for online banking, ordering groceries as most
of them stay away from their home. It was also implied that youth were active in making
financial transactions through mobile banking in India.
.
Age of the Respondents

2%
13%
36%
49%
18-25 26-35 35-49 Above 50
Therefore, mobile banking is popular among them.
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2. EDUCATION LEVEL
Shows that out of 50 respondents, 44% were Graduation holders,38% Post-Graduation &
11% higher secondary. Thus, majority were graduation and post-graduation as the figure
indicates.
This analysis shows people with graduation and post-graduation above are more about
mobile banking. Education plays a very important role in influencing customers to use a
service. Uneducated people or less educated people find the applications little difficult to
handle so they avoid using it.
EDUCATION LEVEL
7% 11%
38%
44%
HIGHER SECONDARY GRADUATION POST GRADUATION OTHER
Therefore, education affects the demand of mobile banking.
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3. OCCUPATION OF THE RESPONDENTS
The result shows that 41% of the respondents were employees of different companies or
firms. It has been observed that individual occupation contributes to the economy of the
country.
Since this study wanted to know how individual occupation had been contributing to uses
of mobile banking in India. These findings implied that occupation of an individual played
significant effect in using mobile banking. Those with occupations were the most users of
mobile banking services compared to students and others who had no job.
OCCUPATION
45
40
41%
35
30
29%
25
20
15
15% 15%
10
0
STUDENT EMPLOYED SELF-EMPLOYED OTHER
Those with the reliable job and students were suffering from accessing income and
therefore made them difficult to engage actively in mobile banking.
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4. Respondents with accounts at Bank
The results obtained showed that out of 50 respondents 100% were account holders at bank.
According to them, most of them had enough experience on mobile banking.
ACCOUNT AT BANK
YES NO
100%
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5. AWARE OF MOBILE BANKING SERVICE OFFERED BY BANK
The study wanted to know whether respondents were aware of the services offered by banks
on mobile banking. The results indicate that out 50 respondents, 58%
respondents knew a few services provided by banks on mobile banking.
Also 2% respondents are not aware of service. It was revealed that majority of respondents
were aware of the services offered by banks on mobile banking, it implied that customers
are not utilizing full the services offered by banks.
Aware of service offered by bank

70%
60%
50%
40%
30% 58%
20%
30%
10%
10%
0% 2%
I know all of them I know few of them I know only one None
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6. WHICH MOBILE BANKING SERVICES RESPONDENTS AWARE

OF
The study wanted to know how many mobile banking services respondents had idea about
or heard of. For this, they were asked about various mobile banking services.
WHICH MOBILE BANKING SERVICES RESPONDENTS

AWARE OF
30
25
20
15
10
0
CUSTOMER FUND TRANSFER BILL PAYMENTS MINI BALANCE NONE
REGISTRATION STATEMENT ENQUIRY
This bar graph indicates that most of the bank customer knows about various services
offered by banks. Only few of them had no idea about mobile banking services. According
to survey among people who know about services have heard most of the services only few
have not heard of any of them.
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7. RESPONDENTS AWARENESS ON MAKING TRANSACTIONS
The findings as indicate show that 86.2% were aware of making transactions via
mobile banking.
Awareness on using a service among customers or users is very important for it to prosper.
The study wanted to know whether respondents were aware of making transactions through
mobile
banking services.
RESPONDENTS AWARENESS ON MAKING

TRANSACTIONS
YES NO
YES
6%
NO
94%
The survey showed that respondents were aware of making transactions through mobile
banking. The majority of the respondent were aware of making transactions through mobile
banking. This implies that most of them were educated and thus there were early adopters
of technology.
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8. THE MAJOR ISSUE IN MOBILE BANKING
Customers have to aware about Mobile Banking Services before usage. The awareness and
Risk about Mobile Banking was tested by 50 Customers and Comparable with other risk
factor most pointed out the “Forget to Log off”.
MAJOR ISSUE IN MOBILE BANKING

50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
MOBILE FOGOT TO LOG OFF ANTI VIRUS SPEND NOMINAL COMPULSORY
COMPATIBILITY MISUSE SOFTWARE CHARGE INTERNET
UPDATION
The above collected data also indicates that 45% of Customers mentioned the “Forget to
Log off & Misuse” of Mobile Phones due to theft is a major risk factor in the above list.
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9. CHALLENGES OF MOBILE BANKING
The study wanted to know Challenges of mobile banking which are added as handset, user
friendly, privacy/security issues, customer awareness and comfortable without mobile
banking where most agree on user friendly, was neutral about customer awareness.
CHALLENGE IN EXTENDING MOBILE BANKING

40
35
30
25
20
15
10
5
0
HANDSET USER FRIENDLY PRIVACY/SECURITY CUSTOMER COMFORTABLE
ISSUES AWARENESS WITHOUT MOBILE
BANKING
AGREE NEUTRAL DISAGREE
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10. HOW MANY TIME DO YOU USE MOBILE BANKING SERVICES?
This study wanted to know whether respondents how many time use mobile banking
services. 55% respondents use mobile banking on daily bases, also 34% respondents use
weekly. The majority of people use in there daily and week bases they met find it easy.
Daily Weekly Monthly Not at all
1%
10%
34% 55%
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11. IF ANSWER IN ABOVE QUESTION IS “Not at all”: WHY DON’T

YOU USE MOBILE BANKING SERVICES?
The finding indicates that 55% respondents have other issues related to mobile banking
services also they have no issue. 16% respondents find it not easily accessible, n remaining
have issues like security, transaction charges, not heard of services.
Therefore, people have there issues with mobile banking services which they face while
using it.
It is not accessible easily not sure of the security Transaction charges are high
not heard of services other
16%
11%
55%
11%
7%
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12. WILL RESPONDENTS SHIFT TO MOBILE BANKING

COMPLETELY
The survey clearly states that responses are mixed thoughts of respondents, some of them
will shift to mobile banking completely, others are not sure and rest of the respondents will
not shift, as they are used of traditional banking habits and they are comfortable without
mobile banking. Still, majority of them are ready to shift. So, this indicates that by making
all the customers aware about the services offered, mobile banking habits will grow in near
future.
Yes No Not Sure
20%
48%
32%
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13. DOES MOBILE BANKING HAVE BRIGHT FUTURE
According to the survey the majority of the respondents thinks that there is a bright future
of mobile banking in India. Some of them were not sure but it is noted that no respondent
had said “NO” for the bright future of m banking
Yes No Not sure
25%
0%
75%
In addition, according to the secondary sources, India has a great prospect to leverage the
potential of m banking and build a cash light economy. For this, many reforms and
enrolment drives which have been undertaken by the Reserve Bank of India (RBI) and the
Government of India over the last five years to give drift to the financial inclusion agenda.
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14. COST OF MOBILE BANKING THAN TRADITIONAL BANKING
From the survey 49% respondents are not sure of the cost of mobile banking than traditional
banking. 19% respondents think mobile banking cost is higher than traditional. And some
of them think the cost is lower or some.
HIGHER LOWER SAME NOT SURE
19%
49%
18%
14%
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15.UNIQUE FEATURE WHICH WILL GIVE EDGE TO MOBILE

BANKING
Privacy and Reducation in online frauds 12%
Growth of E-commerce 23%
Technological Advancement 16%
Speedy process 33%
Innovative payment system 16%
0% 5% 10% 15% 20% 25% 30% 35%
As according to the results, most people that is 33% thinks that “Speedy Process” will be
decisive in giving edge to mobile banking in India.
The customer’s perception was found to be overwhelmingly positive. The most appreciated
feature was SPEEDY PROCESS.
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19. CONCLUSION & SUGGESTION
CONCLUSION
Mobile banking has become popular owing to the convenience that it gives its customers.
You can access your account, pay bills, and make cash transfers through cell phone banking.
It offers many benefits over internet banking and banking in person. With the wide range of
mobile connectivity, mobile banking through cell phone can be accessed by anyone. In India,
all the banks should start to follow the concept of mobile banking besides, existing financial
services, which will help us in making our lives easier.
The study concludes that majority of the respondents knew few services offered by banks
through mobile banking. Thus, customers could use many services as possible if they have
the information about the services offered through mobile banking.
It is further concluded that the extension or growth of mobile banking was faced by fear of
customers’ insecurity and network failure/error and lack of knowledge. This limited the use
of mobile banking services among bank customers. Moreover, it is found out that despite the
use of mobile banking among customers only few of them were using these services
effectively. This according to them was due to inaccessibility, insecurity, high charges and
unreliability of the services.
The current limitations of the mobile banking were also found out through study; those
are:
• Mobile Banking offers non checking limited purpose account only.
• Most people have not enough idea about mobile banking yet.
• The customer who has already an account with the bank, he needs addition account for
mobile banking.
• The customer who has the convention and mobile bank account both, he cannot access
the conventional account through mobile account.
• Mobile banking is being used for fund transfer mainly. Customer does not keep deposit
for long duration.
• Mobile banking has no various deposit schemes as of conventional banking yet.
• Mobile banking has no investment/loan schemes yet.
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• The data is transferring through a third-party cellular network, so there is a security

thread.
• Mobile bank has not interbank fund transfer facility yet.
The limitation of this study is that it focused only on the latest trends of m banking
transactions and apps only, not considered the other m-banking modes like SMS, m-wallet,
m-pesa. In the past few years, the Indian banking sector has completely transformed. The
banks are facing many challenges and many opportunities are available with the banks.
Many financial innovations like ATMs, credit cards, RTGS, debit cards, mobile banking etc.
have completely changed the face of Indian banking. Still there is a need to have more
innovative solutions so that the challenges can be solved and opportunities can be availed
efficiently by the Indian banks.
Research so far has outlined a diversity of challenges and innovations that exists in the m-
banking arena. Numerous solutions have been tried and failed but the future is promising
with potential new technology innovations.
Yes, it is concluded that there is vast scope for growth in mobile banking industry. In future,
the concept of carrying cash or carrying wallet may become obsolete... Your mobile phone
will be able to serve as a debit and a credit card.
In addition to IT edge and relatively dense population, the Government of India is clearly
determined to achieve financial inclusion and is taking aggressive steps to see this happen.
The regulatory body RBI now taking more and more innovative steps and provide various
guidelines to banks for protection of customer account security on mobile website and
applications. Inclusion of non-banking population in financial mainstream will benefit all.
There is also need to generate awareness about the mobile banking so that more and more
people use it for their benefit.
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RECOMMENDATIONS AND SUGGESTIONS
Based on the findings of the study, the following recommendations are made:
In Mobile Banking Applications, whenever we need to avail financial services, we have to

enter our User name and Password for using our account transactions. After completion of
our task, Customers have to log off these services. However, sometimes, for regular usage
Customers may forget or postponed to log off. At that time, this mobile application always
keeps inside the corresponding Customer’s Account Database. If the Customers mobile
phones theft means, automatically hackers can reveal all their transaction details very easily.
This will become a very big issue. Banking Sector has to avoid this type of problems by using
new emerging technologies.
At the Same time, Customers also have to aware about these Services like How to use these
apps, what are the security measures taken by the banking sector and how to avoid major
risks from unauthorized persons.
The awareness creation among the existing customers and providing special benefits for
using the mobile banking will increase the mobile banking users. Once the customer becomes
confident on technology, it will automatically increase the adoption of mobile banking in
mass.
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RECOMMENDATIONS ON CHALLENGES FACED IN ADOPTION OF

MOBILE BANKING
Data has been collected from various sources; there is a combination of both primary and
secondary data that has been used in this research to find out these challenges.
a) Handset operability: There are a large number of different mobile phone devices and it is
a big challenge for banks to offer mobile banking services on any type of device. Some of
these devices support Java Me and other support SIM application Toolkit, a WAP browser, or
SMS only. This is because of the manner in which mobile phones applications evolved over
time, the device manufacturers focused on particular standard, and this led to a proliferation
of applications (Okoegwale, 2008:2)
b) Mobile banking security: Security of financial transactions, being executed from some
remote location and transmission of financial information over the air, is the most
complicated challenges that need to be addressed jointly by mobile application developers,
wireless network services providers and the bankers’ IT departments.
The above aspects need to be addressed to offer a secure infrastructure for financial
transaction over wireless network: If the bank is offering a smart card based security, the
physical security of the device is more important. There should be authentication of the
device with service provider before initiating a transaction. This would ensure that
unauthorized devices are not connected to perform financial transactions.
c) Scalability and Reliability: Another challenge for the banks is to scale-up the mobile
banking infrastructure to handle exponential growth of the customer base. With mobile
banking, the customer may be sitting in any part of the world (anytime, anywhere banking)
and hence banks need to ensure that the systems are up and running in a true 24×7 fashion.
d) Application Distribution: due to the nature of connectivity between bank and its
customers, it would be impractical to expect customers to regularly visit banks or connect to
website for regular upgrade of their mobile banking application. It will be expected that the
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mobile application itself check the upgrades and updates and download necessary patches (so
called ‘’Over the Air’’ Updates). However, there could be many issues to implement this
approach such as upgrade/synchronization of other dependent components.
e) The most solemn threat faced by the banking sector is that the customers do not consider
m-banking services safe and secure all the time. They cerebrate that there may be loss of
data/money due to technical defaults.
f) There is lack of preparedness on the part of both i.e. Banks and customers in the adoption
of incipient technological changes.
Therefore, there is a need on the banks side to remove these barriers and educate customers
about mobile banking services.
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RECOMMENDATIONS ON PROSPECTS OF MOBILE BANKING IN

INDIA
Mobile banking is a Banking process without bank branch, which provide financial services
to unbanked communities efficiently, and at affordable cost. The aim of the service is to bring
more people under the umbrella of banking service. Government thinks it has a great
prospect, as it is a new technology in digital India, though it will take time for customers to
get used to it.
Mobile banking has a bright future in India, some of the ways to how?
Enlarge the customer base targeting mass market and millennials
First, they must diversify their offer beyond day-to-day banking. As such, by providing
clients with a larger range of offers and services (including savings & investments and
mortgages), they will be able to cover all the clients’ needs. Therefore, their clients will not
need to hold another account with a competitor. This should help targeting the mass-market
segment, which usually is in relation with a single bank. The second main lever for mobile
banks to increase their customer base is to offer a unique customer experience in order to
target the millennials.
Indeed, millennials (or generation Y) now outnumber baby boomers and represent the largest
population for banks (80 million people in the US). While they represent a natural target for
mobile banks due to their digital and mobile appetence ,the customer experience and mobile
experience is key since bad apps make millennials twice more likely to switch banks than the
overall population1. Moreover, while attrition rate is low in the banking industry, acquiring
young customer (i.e. millennials) is key to generate stable and increasing revenue with time.
Banks are aware of the potential that this population represents and as such have started to
make move to target them. For instance, in December 2015, Customers Bank took over
Higher One in order to acquire its 2 million students’ accounts in the US.
Mobile banks should aim larger customer targets, much larger than what online banks have
been doing until now. Thus, the product offer and the customer experience must enable to
address millennials and mass market but also entrepreneurs and SME, migrants and frequent
travellers, or the elderly, as strong growth levers. Regarding the product offer, the size of
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smartphones is not a limit anymore and for the most complex products, mobile banks can rely
on tablets. In terms of pricing and brand awareness, mobile banks should base their model on
online banks’ best practices such as a pay per use pricing, a well-managed community or a
minimal physical presence through light branches. Furthermore, the acquisition strategy must
lean on a progressive on boarding process with several stages. Mobile banks should offer
more services to non-customers and leverage mobile capabilities to build a pedagogical
learning experience until customer on boarding. Considering that the traffic on banks’ digital
channels is fragile (high but concentrated on basic usages and increasingly spread on
numerous actors due to PSD2), the customer experience must enable to reinforce and
diversify this traffic.
Among the four principles we identified for a successful customer experience (differentiation,
personalization, simplicity, high availability), differentiation might be the most important.
Indeed, after massive investments in reproducing services already available on other
channels, it is time to offer differentiating digital services, by reinventing services and
focusing on usage value. It will bring banks to go beyond their traditional offer proposing for
instance to entrepreneurs and SME services such as company registration, bookkeeping or
invoicing.
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its effect on Customers, School of Computing, Blekinge Institute of Technology, SE-
371 79 Karlskrona Sweden, 2011.
➢Sharma, Prerna, Bamoriya & Preeti Singh (2011) - Issues & Challenges in Mobile
Banking In India: A Customers’ Perspective.
76 | P a g e
APPENDIX :
QUESTIONNAIRE
Dear Respondent,
I am Student of K.P.B. Hinduja College. In this regard, I am Kindly asking your help
in filling this questionnaire which will be used as data in examining the "Mobile
Banking in India". This research is purely for Academic Purpose.
1. What is your Name?
___________________
2. What is your Age?
18-25
26-35
36-49
Above 50
3. What’s your Education?
Higher Secondary
Bachelor degree
Master degree
Other
77 | P a g e
4. What is your Occupation?
Student
Employed
Self-employed
Other
5. Do you have a Bank account?
Yes
No
6. Do you know mobile banking Service offered by bank?
I know all of them

I know few of them
I only know one
None
7. From the following which mobile banking services you aware

of?
Customer registration
Fund Transfer
Bill Payment
Mini Statement
Balance Enquiry
None
8. Are you aware that you can make transaction through mobile
banking service?
Yes
No
78 | P a g e
9. What are major issues in Mobile Banking?
Mobile Compatibility
Forget to logoff misuse
Anti-virus software update
Spend nominal charges
Compulsory internet
10.What do you think are main challenges in extending mobile

banking service to more customer?
AGREE NETURAL DISAGREE

Handset
User friendly
Privacy/security
issues
Customer
awareness
Comfortable
without mobile
banking
11.How many time do you use Mobile Banking Service?
Daily
Weekly
Monthly
Not at all
12. If answer in above is “not at all”, why don’t you use mobile
Banking services?
It is not accessible easily

Not sure of security
Transaction charges are high
Not heard of services
Other
79 | P a g e
13. Do you think Mobile Banking has a bright future in India?
Yes
No
May be
14.What is the one feature do you think will be decisive in

ascertaining the growth of mobile banking?
Innovative payment service

Speedy process
Technological advancement
Growth of e-commerce
Privacy/ reducation in online frauds
15. What do you think about the cost of mobile banking than
traditional banking?
higher
lower
same
not sure
THANK YOU FOR YOU RESPONSE
80 | P a g e

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(MOBILE BANKING IN INDIA)

1.1. CONCEPT OF MOBILE BANKING

1.2. MOBILE BANKING BUSINESS MODELS

1.2.1. Bank-focused model

1.2.2. Bank-led model

1.2.3. Non-bank-led model

1.3. MOBILE BANKING IN INDIA

1.3.1. MOBILE AS A MEDIUM

1.3.2. DEVELOPMENTS IN MOBILE TECHNOLOGY

1.3.3. MOBILE BANKING SERVICES

Mobile banking can offer services such as the following:

Payments, Deposits, Withdrawals, and Transfers

1. General information such as weather updates, news

1.3.4. ORIGIN AND POTENTIAL OF MOBILE BANKING

1.4. MOBILE BANKING IN WORLD

3. TECHNOLOGIES ENABLING MOBILE BANKING

• Mobile Banking over Wireless Application Protocol (WAP)

These mobile banking services have been discussed in detail here:

Mobile Banking over WAP

Mobile Banking over SMS

Mobile Banking over USSD

4. ADVANTAGES & DISADVANTAGES OF MOBILE BANKING

ADVANTAGES OF MOBILE BANKING

• Increased efficiency: mobile banking functions are functional, efficient and

• Fraud reduction: one very real advantage to implementing mobile banking.

DISADVANTAGES OF MOBILE BANKING

5. FEATURES OF MOBILE BANKING

• Interoperability: Development should be based on standards and open technologies that

6. CHALLENGES OF MOBILE BANKING

Key challenges in developing a sophisticated mobile banking

3. Scalability And Reliability

7. FUTURE PROSPECTS OF MOBILE BANKING

A. Under-banked and Un-Banked Population

C. Bank Based Services

8. TOP 10 MOBILE BANKING APPLICATIONS IN INDIA

1. ICICI iMobile Application

2. HDFC Mobile Banking App

3. State Bank of India YONO App

4. Bank of Baroda M-Connect Plus App

5. Axis Mobile App

6. Kotak- 811 & Mobile Banking App

7. IDBI Go Mobile+ App

8. CANDI- Mobile Banking App

9. PNB ONE Mobile Banking App

10. HDFC PayZapp

9. IMPACT OF COVID-19 ON MOBILE BANKING

10. RESERVE BANK OF INDIA REGULATION

A. Transaction Limits in Mobile Banking

B. Security and Authentication

11. OBJECTIVE OF THE STUDY

Specifically, the study aimed at:

6. To propose suggestion to improve the Mobile Banking Services based on findings.

12. SCOPE OF THE STUDY

13. NEED OF THE STUDY

B. Security Issues & Privacy:

C. Virus & Malware Attack:

14. RESEARCH METHODOLOGY