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Monday, September 9, 2013

SBI report welcomes RBI Governor Raghuram Rajan's focus on mobile banking

Terming it as a "game changer", a State Bank of India report has welcomed Reserve Bank Governor Raghuram Rajan's stated focus on deepening the penetration of mobile banking.

"Mobile payments could be a game changer, both in the financial sector as well for mobile phone companies," an SBI research report said after Rajan announced a slew of measures in his maiden address as the head of the central bank.

In this address, Rajan had announced the constitution of a technical group to study the feasibility of using an encrypted, SMS-based application for fund transfer, which which can run on any cellular phone handset.

Speaking of the advantages of mobile banking, the SBI note said that only 60 per cent of the population is covered by banking services today, though more than 75 per cent have mobile phones.

Additionally, mobile payments are also cheaper, the SBI note said, adding that a transaction through a mobile phone costs merely 2 per cent of a bank branch based funds transfer, 10 per cent of an ATM-based funds transfer and 50 per cent of an online banking transaction.

"Future business opportunities of banks will depend crucially on how well they connect with their technology savvy customers," the SBI report said.

Source: EconomicTimes


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