Microsoft, in conjunction with a partner, M-Com, launches an electronic banking software platform that allows electronic payments to be made via mobile devices. The porting of banking-related functionality onto smartphones has been a focus of the banking industry, which sees such applications as a way to build consumer loyalty, although some analysts are dubious.Microsoft
has launched a mobile banking service in conjunction with M-Com, an
"international mobile banking and payments solution provider" based
in Atlanta. The resulting
application, M-Com BankAnywhere, will use a number of Microsoft technologies,
including Windows, SQL Server and Internet Information Services.
Microsoft and M-Com are aiming to create a mobile channel for banks with
best-practice security and risk-management capabilities. Although the
functionality for mobile banking has existed for some time, it is still
regarded as an emerging market by many financial institutions.
"Additive banking is about adding further choices or channels for banks
to serve their customers or making the banking experience more convenient for
existing customers," analyst Howard Wilcox wrote on the Juniper
Research blog. "Additive banking is a critical strategy and driving
force for established banks globally."
Wilcox added, "The crucial aspect is enabling transactions for people
to do on the moveafter all, doing your banking ain't the most exciting thing
in the world, so why not save time and do it while you're traveling
anyway?"
The M-Com BankAnywhere application, for which a release date has not been
announced, will allow electronic payments via a mobile device.
The announcement "underscores our efforts to provide multichannel
integration that allows financial institutions to benefit from mobile and new
media channels as part of the overall connected experience," Susan Hauser,
vice president of Worldwide Financial Services at Microsoft, said in a
statement Sept. 16. "Our alliance with M-Com expands our partner ecosystem
for payments and mobile solutions and further validates our leadership position
as a provider of payment processing platforms."
The intersection between banking services and smartphones is undergoing considerable
exploration by vendors. USAA, a financial services group for members of the
military and their families, announced Aug. 10 that it was adding a feature to
its iPhone app that would let users deposit
checks by taking pictures of the checks with their iPhones. At that time, USAA
also announced that it was developing applications with similar functionality
for Android, Palm, Windows Mobile and BlackBerry devices.
"Mobile banking is a potentially attractive growth segment for
operators, handset makers and bankers," Neil Mawston, an analyst with
Strategy Analytics, told eWEEK at the time, "so we will certainly see more
innovative services over the coming years."
A number of financial institutions, including Bank of America and Wachovia,
have offered basic services on customers' mobile devices for years. For those
companies, mobile banking represents a way to interact with the customer for
longer periods of time and thus potentially accrue more loyaltyalthough some
analysts have consistently expressed skepticism that this is effective.
"We have struggled to see the business
rationale for mobile banking," Gartner analyst Alistair Newton said in
a May 2007 interview. "Chasing after new customers quickly becomes a
zero-sum game, where it costs them so much to get a customer from their
competitors that it's not worth it, or they lose existing customers in the
meantime.
"There is a belief that mobile banking will help them retain
customers," Newton added,
"but I'm not convinced."
