The value of such transactions stood at Rs 91 crore in May 2011, according to the Reserve Bank of India (RBI).
The number of bank transactions through mobiles also grew over two-and-half times to 3.34 million in May 2012 from 1.28 million in May 2011.
As the number of mobile phone subscribers are growing rapidly, banks in collaboration with telecom companies are seeking to develop an alternate channel for the delivery of banking services, as a part of the financial inclusion programme.
As on May 31, RBI had permitted 69 banks to provide mobile banking services to their customers.
However, the central bank feels the growth rate is low when compared with the number of bank accounts and the number of mobile subscribers.
“Though the value and volume is increasing on a month-on-month basis, the growth rate is low when compared with the number of bank accounts and the vast mobile subscriber base of more than 900 million,” said Harun R Khan, deputy governor, RBI, in a recent speech on financial inclusion. This indicates banks are yet to exploit this technology even for existing customers, he said, adding RBI had provided policy framework for a collaborative relationship between banks and mobile network operators. Banks allow fund transfers for personal remittances and purchase of goods and services without any ceiling, say the mobile banking guidelines of RBI.
The rapid growth in users and wider coverage of mobile phone networks have made this channel an important platform for extending banking services to customers.
Banks also offer information based services like balance enquiry, stop payment instructions of cheques, transactions enquiry, location of the nearest ATM and branch through mobile banking. Some banks offer services like acceptance of transfer of funds instruction for credit to beneficiaries of same or another bank in favour of pre-registered beneficiaries.
However, there are technology and security related challenges involved in delivering financial services through information and communication technology (ICT) based models.