Last week I had the pleasure of discussing the future of mobile banking with two executives from Sun Microsystems Carl Morath (Marketing Manager – Worldwide Financial Services) and Donna Rubin (Director of Marketing – Worldwide Financial Services).
Prior to the call I knew that Sun was the creator of Java technology; however, did you also know that the SIM chip in your cell phone is likely a Java Chip? In fact, an online search found that, “there are more than a billion Java-enabled phones in operation, and 70 percent to 80 percent of the GSM phones are also equipped with Java (February 2006).” – Blueboard.com
As we discussed the future of mobile banking Mr. Morath felt that the market would evolve in this fashion.
1. SMS - “It’s a given”
2. Browser - WAP 2.0 is better but not great. There will not be huge take-up.
3. Downloadable – More complex but there will be good take-up.
The most interesting aspect of the discussion though revolved around the projects that Sun has in development to improve the mobile banking experience. Sun has decided to focus their resources on two primary initiatives.
First, Sun does not feel that the OFX and ATM interfaces currently utilized by downloadable applications provide adequate support. To improve upon this model Sun is working to wrap a new interface around this existing technology. The new interface will build upon the bank’s existing transaction sets; yet, will create a new extensible web service. This basically means that we will have one interface that is able to incorporate and integrate all three mobile banking solutions (SMS, Browser, Downloadable).
Secondly, Sun is working to figure out how to provision a credit card in a cell phone. Understandably, this has been a challenge from a security aspect, because it requires a delicate balance of restricting bank information from carriers and carrier information from banks. Fortunately, Sun is well versed in dealing with both players. Over the years they have formed strong relationships with the carriers and as of 2004 provided internet banking technology to 85% of the banks in the market.
While Sun’s participation is not as transparent as the traditional mobile banking vendor they are a critical player, and will be instrumental in shaping the future of the mobile banking landscape.
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3 comments:
Great post, thanks. Do you think Sun alone can facilitate the provisioning of credit cards for cell phones? It seems to me that it needs to work toward this goal with other parties involved, such as MasterCard and Visa. The security issues demand it.
JJ Hornblass
BankNet360.com
JJ,
You are correct. Due to the very nature of the mobile environment nearly every initiative is going to require the partnership and cooperation of multiple players. Thanks for the comment -
Brandon
being working with smart cards for some time (and SIM card based banking solutions in Central Europe), I would say, that at least here, banks would not go for mBanking solution, which is not based on a secure hardware. "The secret" must be stored on SIM, or a different type of smart card (well, I cannot imagin pluging EMV card to my handset, but can be a solution).
What, at least as I see it, can be a solution, is something SIM vendors ara pushing - SWCS: smart card web server (some presentations announced for Cartes congress). This could be a solution. Combining sexy look of internet banking, with the secure "secret" storage...
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