Mobile Is The Way To Reach Un-banked India

Sybase 365 recently provided their technological services to Indian enterprises like MSN India, Just Dial, United Bank of India, etc to reach their customers through a new medium – the mobile phone. The company handles 6.5 billion messages worldwide, in a month.

Matthew Talbot, vice president (Asia), Sybase 365 talks to Biztech 2.0 about the emerging trends in mobile solutions that can enable enterprises, especially in the banking sector to expand their range of operations.

Value added services for mobiles (VAS) have recently picked up momentum in India. How do you see enterprises leveraging these services?

We work throughout the Asia Pacific and there are not many countries where we don’t operate. India is going to grow very fast, and is very quickly going to get to where China is now. China is the biggest mobile market in the world and VAS have been extremely successful from day one. The difference between the Chinese and Indian markets is that China’s operators have developed an ecosystem that actually looks after the VAS providers. A good example is that they give 85% of the money back to the content providers and the service providers. If you relate that to India, India is a little bit of a mess in the way that it runs its VAS at the moment. There are 11 operators handling a complex market, but also there is no standard regarding what they give back to the ecosystem. You’ve got some operators who will take 10%, others will take 20%, 30%, and so on. Unless you get to an extent where the bulk of the revenue actually goes back to the service provider, it’s never going to actually break the market.

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Financial services, however is a different matter. When you look at the number of banks, and the limited amount of ATMs and bank branches – 65,000 bank branches, 25,000 ATMs and 90 million mobile phones you realise that banking has to go mobile. The un-banked population in India is enormous. Because you can’t put ATMs out there, you can’t put infrastructure on the bank, the mobile opens up a whole new way to reach un-banked India. That is a completely different value proposition for both the carriers and the banks. It’s not really a value added service, but the extension of an enterprise and is priced differently.

What are some of the other enterprise sectors where you see opportunities for yourself as a vendor?

I think the BPO and call centre industry is a huge business in India and they’re looking at ways for utilising messaging to save costs and increase revenue. People don’t want to speak to an operator; they want to do things in their own time. In the transport vertical, the Indian Railways poses a potential. Look at the problems people have today in booking tickets, in finding out timetables, etc. Once you start mobile services to tackle that, you’ll see the full power. Most airlines today have simple things like alert services on flights; you can check in online, get a message saying what choice of seat, etc. So it crosses all verticals including government sector as well.

How do you ensure that the data is not at risk during a mobile transaction?

If you look at banks across the region in general, they have been using mobile services to increase security. I think one of the first services that was launched by a lot of banks was two factor authentication. It is all about giving a second authentication using a phone. So for internet banking, today most banks are giving out either a token that you can use as a password or they’ll send you an SMS. That shows how banks are using mobile to actually improve their security.

Another one is credit cards. If you swipe your credit card that goes over a certain amount, you get an alert telling you that you’ve just swiped your credit card, is this a valid transaction, yes or no? I think when they’re looking at transaction-based security, there are different levels depending on the protocol. For SMS you’re restricting what you can do, because it’s just a straight SMS, but you can still ask for passwords and so forth. As you move towards a browser experience whether it’s WAP or a client, you can build encryption into a client. In the end it is a lot more secure than any other type of banking.

What sort of business model do you see emerging in this space?

The business model for the industry is constantly changing. There has been one business model for VAS. Everyone understands that it’s all about revenue sharing and pay per message. There are things like development fees, set-up, maintenance, but the model is pretty well understood across the world. It varies with the percentages that the operators give their content providers.

If you look at the enterprise world however, it’s a completely different model. Enterprises look for a different quality of service - both from the operators and service providers like us. If they don’t get their 2-factor authentication, for example, it breaks down their whole internet banking system. So it’s a completely different level of service and with that there’s a price as well. Service providers like us have to continue investing in infrastructure. So it’s not a revenue share model anymore, it’s changing.