Korean Cell Phones Turn Into ATMs

South Korea's retail banks now offer mobile banking. New phones can come equipped with a special slot where subscribers can plug in a tiny memory chip with their banking data and an encryption code for secure transactions.

Banks have high hopes for the wireless service. Koreans have already set up more than 24 million online bank accounts. Given that more Koreans own cell phones than computers, and the convenience of being able to bank anytime and anyplace, bank execs believe most Net banking clients will eventually sign up for mobile banking. They also believe that mobile banking via cell phone will draw customers without computers to bank remotely.

That will likely save banks a bundle. Transactions made by cell phone cost a fifth of what face-to-face transactions do. Carriers benefit too, gaining a new revenue source and a new way to keep customers from defecting to rival operators.

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