Mobile Banking in India - Technology Drivers


Technology advancements continue to transform the banking industry with direct channels such as mobile and the internet catching the tiger by the tail.  As per a research, India will exceed 200 million smartphone users, topping the US as the world’s second largest smartphone market by 2016, largely on the back of growing penetration of affordable smart mobile devices.

With PC installed base at 85 million and internet user base over 250 million, mobile is already the primary mode of internet access to a large number of Indians. As the proliferation of smartphones and mobile internet increases, the handheld mobile device will become the first computing device for mass market consumers in India, says Convergence India in its `Key Indian Telecom Industry Trends to Watch Out For in 2015’.

These advancements in technology are propelling banks to lean more towards web and mobile to offer regular banking services and retain their branches for sales and advisory services.  As a result of this advancement, the number of customers who perform banking activities on-the-go has increased considerably.

In spite of these forecasts, the advancement of mobile banking technology, is slow with many banks still offering services such as banking through SMS, application-based solutions, and USSD channels. According to the Reserve Bank of India’s Circular, lack of awareness and standardization of procedures add to the problems which have led to slow increase of mobile banking services, despite the high mobile density and penetration in the country. This is of particular importance when customers are using inter-operable mobile banking platforms, states the Circular.

What on mobile?

So, while the case to go mobile is growing stronger by the day, many banks are not finding it easy to make the decision. Their list of concerns is long, and mostly technology related as they worry about how much to invest, what features to offer, how to measure the return on investment. While some ponder, a few others are pushing ahead with their mobile banking services.  The apps these banks have developed empower customers to perform key transaction like transfer funds, pay bills, book tickets, do a recharge.So what kind of technology is required to build an app for a banking services organization? While some developers evangelize native application development, others believe hybrid applications (cross platform) make more sense.

Hybrid or NativeMobile apps were originally designed for specific devices, and screen sizes.  They required to be developed separately for each operating system.  This, however, became an expensive approach with the fact that the market has varying sizes of smartphones. Over a period, mobile app development has evolved and today, depending on requirements there are two options, i.e. build a full native app or build a hybrid app. Native apps are written for specific platforms using different technologies - Objective-C for iOS, Java for Android and C# for Windows. Native apps incidentally offer the best user experience and animations as they are built using the device’s native language, and installed on the device itself.

They can interact with and maximize available hardware, operating system features and other applications installed on the device. For banking organizations, their respective native applications need to support smartphones across different platforms, and this requires large investments in terms of time and money.On the other hand, Hybrid apps are partly native and partly web (HTML5). In the hybrid approach, the app is developed in such a way that HTML 5 portion can be rendered across multiple devices, and screen sizes and only a subset of functionality is developed using native language. This is a good way to manage enhancements, reduce go-to-market time and coding overheads. These benefits of the hybrid app can be utilized only with the right mix of native and web, else it will increase maintenance overhead and can also result in negative user experience.

To summarize, there is really no clear right or wrong way.  A lot depends on a banker’s business needs, user base and what to focus on. These and other related factors will determine which approach (Native or Hybrid) is best suited.

Benefits of Going Mobile

When it comes to investing in a mobile app, bankers would ideally like to quantify the return on investment. However, intangible benefits like customer engagement, enhanced transactions and future returns such as the possibility of monetization could be the quantum list for now. The quandary also relates to how much content the app version could showcase in comparison to content heavy banking portals.The question that banks should ideally be asking is whether a mobile app will simply mirror its web counterpart or can some of its distinctive features be maximized to reap benefits? 

For example, what if mobile apps could offer real-time status on request submissions and query responses?  It would require a customized app that would connect the customer’s smart phone to a loan officer’s network from where he or she can respond to queries in real time.  That kind of service would take banking to the next level in exceeding customer expectations.

To summarize, there are opportunities and the means to achieve them.  What is required is out-of-the-box thinking and the right mobile technology to convert a thought into a value-added feature.