Banks see pick-up in mobile banking

Banks have seen an increase in the number of customers opting for mobile banking services in the last two months due to a steep rise in small-value transactions. 

Country’s largest lender, State Bank of India (SBI), has added more than 20,000 customers in mobile banking in the last two months and expects the number to rise further in the future, a senior SBI official said. 

“Both customers and bank branches have realised the immense potential of this service, especially when it comes to small value transactions. We have seen more number of customers availing this service in the July-August period,” the official said. 

 

The number of clients registered for mobile banking with SBI has surged from 10,000 in May this year to 33,000 as on date. Bankers attributed the rising popularity of mobile banking service to an increase in the number of small-value fund transfers. 

At present, customers are allowed to transfer funds up to Rs 5,000 and can make purchases worth up to Rs 10,000 through mobile banking. 

Leading state-owned lender, Union Bank of India (UBI), has also witnessed a six-fold increase in the number of mobile banking customers in the last two months. 

The bank’s mobile banking customer-base rose to 11,508 in August from 1,700 two months ago, a major portion of the new customers being youngsters, Union Bank Deputy General Manager (Transaction banking department) Pravin K Bansal said. 

“We have introduced many additional features to our mobile banking offering. Many have found this service very useful, especially for account-to-account fund transfers. There is a lot of potential for mobile banking in the future,” Bansal added. 

Union Bank has targeted to increase its mobile banking customer-base to 50,000 by the end of this fiscal, he said. Another leading state-owned lender, IDBI Bank, has also received a good response for its mobile banking service. The bank has around 40,000 customers registered for the service and is confident of adding substantially more in the months ahead. “Still, this number (40,000) is low. We have given targets to our branches to migrate a certain percentage of their business to innovative models like mobile banking eventually,” IDBI Bank’s Personal banking head C S Jain said. 

In the private sector, despite a large number of people registering for mobile banking, the number of customers who actively use the service is understood to be very low. “Mobile banking is still new in the market and it may take some more time for the customers to build up confidence in the new form of banking,” a senior official with a private sector bank said.