OCBC Cashing In On Mobile Banking

Source : TODAY, Thursday, October 4, 2007

Its facility is secure, but other banks say users ‘not ready'

GOING mobile is the future for retail banking, and with a mobile phone penetration level higher than Singapore’s population, this can prove to be a very attractive and viable option for banks in expanding its reach.

Research firm Frost & Sullivan, in a commentary yesterday, said the mobile device is “building up to become the preferred medium of tactically reaching out to a targeted audience”. Experts say this trend augurs well for content providers for mobile advertising and mobile banking.

A check with the three big Singapore and four foreign banks with retail operations showed the majority offer customers access to Internet banking on mobile devices such as mobile phones and personal digital diaries (PDAs) via GPRS.

A UOB spokesman said the bank does not provide mobile banking, and added: “However, the bank constantly seeks to improve its range of services to facilitate customers’
transactions.” Maybank said it is “likely to offer the service through a different mobile platform and for improved customer experience”. This will be “more integrated” with its online banking.

Currently, only OCBC is offering a full suite of banking services on a dedicated stand-alone mobile banking platform that is seamlessly integrated with its hall and internet banking services on the back-end.

Following the successful adoption of Internet banking in Singapore several years ago, most banks have looked to mobile banking as the next logical step. However, after some trials, most have deemed the platform not secure enough for financial transactions, while others believe customers are not ready for the technology.

In June last year, OCBC Bank bucked the industry trend by implementing its own mobile banking platform that it developed from scratch. The service is available on all three local mobile networks in Singapore— M1, SingTel and StarHub — and can be accessed through more than 90 per cent of the popular mobile phone models.

Since its launch, OCBC’s mobile banking user base grew by 160 per cent as of August this year.

“Transaction dollar value has increased 180 per cent in the same period,” said Mr Patrick Chew, OCBC Bank’s head of delivery. “We have seen the transaction value grow from tens of dollars in value to the ten thousands as customers transfer funds or pay their bills via the mobile phone.”

The bank believes its customers are transacting more frequently with mobile devices as confidence in the platform grows.

“Surveys conducted by OCBC found that 80 per cent of our users found mobile banking relevant to their daily lives, while 70 per cent found the OCBC Mobile Banking platform easy to use and said they would recommend it to their friends,” said Mr Chew.

Account enquiries, bill payments and fund transfers are the most popular secured mobile banking services, said OCBC. New features such as the downloading of Vouchers, dining search and rewards redemption are also gaining acceptance.

The biggest hurdle OCBC faced at first was convincing users the facility is safe and secure. To overcome this fear, OCBC offered the mobile phone as a physical security
token on top of the two-factor authentication (2FA) token and one-time password (OTP) received via SMS for transactions. “We introduced end-to-end encryption to secure both the transmitted data and the customer’s PIN, similar to what we provide in Internet banking,” said Mr Chew.