Mobile
banking will soon be possible with a basic handset and without accessing the
internet. The telecom regulator will soon ask telcos — many of which have been
resisting for years — to enable bank-authorized mobile payment companies to
offer such service. Telecom companies are expected to fall in line with local
and international payment companies, including an associate company of Visa,
lobbying with the regulator and the government for permitting them to tap the
Unstructured Supplementary Service Data (USSD) channel of telcos.
The
USSD channel is a simple interactive text messaging system that can be used by
a mobile phone subscriber to reach out to her bank for anything -- transfer
funds, check balance amount, pay bills, cancel a cheque, request for a cheque
book, obtain an account statement, and even buy books and music using debit or
credit cards. Customers - without 2G or 3G connectivity or a smartphone - have
to simply key in something like *67# -- or any other number a telco provides -
to 'talk' to her bank.
According
to a government official, "The Telecommunication tariff (fifty Sixth
Amendment) Order, 2013 states that all telecom operators are 'obliged' to
provide connectivity to any payment aggregator who has set up a USSD gateway.
Therefore, Trai will ask the telecom operators to comply with it."
Given
the growth in mobile subscriber base and that 75 per cent of users do not have
a smartphone, the decision could increase bank penetration and customer
convenience while lower cost for banks. Even though NPCI has the code and
is ready to provide USSS based banking in Hindi and other languages, its non-profit
character and limited budget has held it back from launching a large ad
campaign and striking joint promotion deals with banks.
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