joins the mobile banking race
Research company Celent believes 2007 will prove to be the
year mobile banking in the US moved into the mainstream, a
prediction that has taken a significant step towards realisation
with the entry of AT&T, the US’s largest telecommunications
service provider, into the mobile banking space. The payments
platform will enable users to transfer funds, pay bills and view
account details from 30 of AT&T’s most popular handsets,
representing about 30 million devices in the US.
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AT&T’s service is the result of what independent
telecommunications analyst Jeff Kagan termed an “innovative and
unique” partnership between AT&T, payment technology developer
Firethorn Holdings, online bill-pay service provider CheckFree and
banking groups SunTrust Banks and Wachovia. The partnership, said
Kagan, “may be the tipping point to widespread adoption of mobile
banking solutions by consumers”.
Underscoring his view, Wachovia’s director of emerging
applications, Ilieva Ageenko, said: “AT&T takes mobile
financial solutions to the next level by extending the capabilities
to a much broader base and provides Wachovia customers with an
innovative new method of ubiquitous access to their financial
information.”
AT&T’s strengths
Explaining AT&T’s approach, Mark Collins, vice-president,
consumer data, for AT&T’s wireless unit, said that when several
financial institutions were designing their own mobile banking
applications to run on carrier networks, AT&T intentionally
chose a different path. “One of AT&T’s core strengths is
discovering great applications and driving mass adoption,” said
Collins. “With mobile banking, we quickly realised that we had an
opportunity to help develop the market, if executed
properly.”
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By GlobalDataThe US mobile banking market, believes Celent, is set to grow
rapidly. “We expect consumer adoption rates to mirror those of
online banking and for mobile banking functionality to expand as
consumers become increasingly comfortable with this entirely new
banking channel,” said Red Gillen, a senior analyst at Celent.
According to Celent, 46 million households currently bank online
and by 2010 it predicts that 17 million households will use mobile
banking for similar functions.
SunTrust Bank’s executive vice-president and head of retail and
commercial lines of business, Gene Kirby, is similarly optimistic.
“The first adopters of online banking were innovators, but now it
is a part of standard operating procedures for many customers who
depend on the flexibility to access banking capabilities after
hours. Mobile banking will follow a similar path,” Kirby
said.
Ageenko said: “From our experience as the first major US bank to
offer a mobile banking solution – Wachovia Mobile – the demand for
mobile capabilities is clear; people want to bank when and where it
is convenient for them.”
Widespread accessibility
With AT&T’s national network, accessibility is impressive.
Mobile banking is supported on AT&T’s third-generation (3G)
network in more than 200 markets and also runs effectively on
AT&T’s nationwide Edge network, the largest high-speed national
wireless data network in the US. The network is available in more
than 13,000 cities and towns and along about 40,000 miles of major
highways.
Increasing adoption of mobile banking will lead to further mobile
financial services being introduced, believes Firethorn’s chairman
and CEO, Tripp Rackley. “We have already begun working with
carriers and financial institutions to develop future applications
that equip customers with a fully functional mobile wallet –
everything from gift card and coupon redemption to contactless
payment capabilities,” said Rackley.
AT&T is one of a number of key customer wins for Firethorn this
year. Another, and probably the most notable, is rival Verizon
Wireless, which in October announced it had selected Firethorn’s
solution to launch a mobile banking service. Verizon, which claims
to be “the nation’s most reliable wireless voice and data network”,
has 62 million mobile phone customers.
