Free Press Journal

Futuristic Banking: Bio-metric applications for your mobile

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Female hands using mobile banking on smart phone

However, cyber frauds are a challenge and bio-metric applications will be the answer to cybercrimes, says Renjini Liza Varghese

Any time money (ATM) in the ’90s, anywhere banking in the 21stcentury, and now, e-wallets. Indian banks – private and public sector – are wooing the customer relentlessly with constant innovations in mobile banking and social media banking. And no one’s complaining.

“We don’t have to visit a bank branch to do transactions now. We can do it from home, office or even while travelling. Working people like me, who used to wait for the weekends to pay utility bills, can now do so online or through ATMs. The best part is that you get an alert for every transaction you do,” says Sharad Srivastava, a Manager with a MNC consulting firm.


“Easy availability of loans (including housing loans), superior customer service, easy availability of debit /credit cards, ease of investing in IPO/equity markets through ASBA (Applications Supported by Blocked Amount) are some of the best things to have happened because of technology,” says Shibu Kallingal, a Wealth Manger with an international investment firm.

 The virtual platform has also brought down the time of processing considerably. A personal loan in 10 seconds and an auto loan in 30 minutes are some of the promises.

Nagarajan, General Secretary, All India Bank Officers Association, voices a note of caution, though. “Technology is the order of the day, but do we need this much of technology? In urban India people are familiar with the newer technologies. But in rural India, the bandwidth of the public sector banks is not as great as those of private banks. A transaction that used to take 15 minutes can take 45 minutes now because the system takes that much time. And don’t forget that rural India still faces power cuts. That can add to the customer’s waiting time in the branch.”

Manju Agarwal, Deputy Managing Director of the largest public sector bank, State Bank of India, counters, “At our branches, we have employed tech staff, to educate customers about new ways of transaction. Printing passbooks was a huge task for SBI and every branch used to dedicate one counter for it. Now customers can print their pass books anytime thanks to the pass book printing machines we’ve introduced, that are placed near the ATM machines. This is enabled with bar-coding, In March 2106 alone; 20 million pass books were printed using these ‘Swayam’ machines.  SBI’s experience is that, if the technology is not cumbersome it is accepted by the customers.”

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To familiarise customers with the newer technology, almost all banks offer touch-point human interface, chats, video chats etc. Many have created video tutorials on how to use their value added services; these tutorials are available on the banks’ websites and YouTube.

Cost of transaction

According to banking experts, the average cost of a transaction done through a branch is around Rs 38, whereas it is Rs 9 on an ATM, and only 60 paise on a digital platform. Naturally, banks are all for implementing advanced technology.

Some customers have voiced concern over the cost of digital transactions. But Nitin Chugh, Country Head – Digital Bank, HDFC Bank (the largest private bank by market capitalisation) says, “That argument is not correct. The charges are for a particular service and will be the same whether on ATMs, the digital platform or through the branch.”

Cyber Frauds

However, a section of customers are still sceptical about transacting on the digital platform because of the increasing number of cybercrimes. The Reserve Bank of India (RBI) laid out internet banking guidelines in 2001and mobile banking guidelines in 2014, mandating banks to have a two-level security system in place for electronic transactions.

Customers’ lack of awareness or ignorance has led to phishing or cyber frauds, argues Manju Agarwal, “There is a small segment of gullible customers that falls prey to cybercrimes. Every time a customer gets a Pin Number or a One Time Password, the message always carries a ‘Do Not Share this Information’ alert. However, customers who failed to understand the risk of sharing PIN numbers or OTPs are those who get trapped. As a precautionary measure SBI has disabled the ‘Card Not Required Transactions’ completely. Now those who want to do such transactions need to activate one’s card first.”

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Manju Agarwal adds, “The infrastructure for electronic transaction is not widespread in our country. It has to be improved to a level where payment to a vegetable vendor can be done electronically.  The RBI mandate should encourage electronic /digital transactions by incentivising the customer.”

What the future holds

“Implementation of the bio-metric system can wipe out fraudulent transactions, as it matches one’s fingerprints and eyes. Only a fraction of customers have migrated to bio-metric because the majority of banks do not have the required data to implement it. But clearly, the bio-metric system will be the future of banking in India,” says Manju Agarwal.

HDFC’s Nitin Chugh’s view is: “Converging everything into the personal device, that is, the mobile phone, seems to be the next level. The challenge now is to integrate all financial services products onto a mobile phone in a secured environment.”

The technological advancement in the banking system is fuelling another business segment called Fintech. According to a report published in June by PricewaterhouseCoopers, funding of Fintech start-ups more than doubled in 2015, reaching 12.2 billion USD, which is up from 5.6 billion USD in 2014.And investments touched 1.2 billion USD in 2015, compared to 145.1 million USD in the previous year.

So for a country that is looking for transparency and is fighting black money, it’s time transactions are migrated to the electronic platform.