INTRODUCTION:

The growth of every economy depends on various sectors like agriculture, manufacturing, education, Finance, etc. in India, after implementation of new economic policy in 1991, financial sector observed as a key element for the growth of the economy. The government has also taken various steps towards this like financial inclusion, rural banking, etc. According to Indian brand equity foundation, the financial sector in India is primarily a banking sector with commercial banks covering more than 60 percent of the total financial assets held by the financial system.

In the current scenario, the banking sector is not an exception, due to recent innovations in telecommunications, banking services have got access to various services like Credit/Debit Cards, ATMs, e-Channels, Internet Banking, Mobile Banking, Tele-Banking, EFT like NEFT and RTGS, etc. Among the various services of Banking in India Mobile banking the one, whereby a customer interacts with the bank via mobile phone. Mobile banking provisions banking and financial services with the help of mobile telecommunication devices. It gives a customer access to transact, administer and customize their accounts. Introduction of mobile banking gave a great hike in banking transactions, but still it has to travel a long way as majority of Indian Banking customers prefer traditional ways of banking.The basic reason of the problem is the lack of knowledge of mobile banking and innovationsin telecommunications related to banking sector.

The present paper studies the innovations, limitations, benefits and problems of mobile banking, and even the future prospects and methods of improvement in mobile banking.

OBJECTIVES:

a) To study about the benefits and limitations of mobile banking.

b) To identify the problems faced by the customers while using mobile banking.

c) To see the future prospects of mobile banking in India.

d) d)To give suggestions for improvement.

METHODOLOGY:

Nature of Study:

The study is mainly descriptive in nature. Secondary data are used for the purpose of the study.

Secondary data:

Paper is based on secondary data collected from various published documents in periodicals, newspapers, various government websites, articles and journals

LIMITATIONS OF THE STUDY:

i) Lack of primary data

ii) Time consuming

iii) As the research mainly depends on secondary data, it may not be hundred percent accurate.

iv) The study is limited to India only.

LITERATURE REVIEW:

The act of sending, receiving and managing money using a mobile phone is Mobile Banking. Mobile Banking can also be called a mode of transacting all bank transactions on a mobile device like (cell phones, tablets etc.). It is a quite popular method of banking that fits in well with a busy, technologically oriented lifestyle. Mobile banking is very convenient in today’s digital age with many banks offering impressive apps. The ability to deposit a cheque, to pay for merchandise, to transfer money to a friend or to find an ATM instantly are reasons why people choose to use mobile banking. Advantages of mobile banking include the ability to anywhere and at any time. It might also be referred to as M-banking or SMS banking.

The amount of banking one is able to do on his/her cell phone varies depending on the banking institution one uses. Some banks offer only the option of text alerts, which are messages sent to your cell phone that alert you to activities on your account such as deposits, withdrawals and ATM or credit card use. This is the most basic type of mobile banking.

The earliest mobile banking services were. With the introduction of smart phones with WAP support enabling the use of the mobile web in 1999, the first European bank started to offer mobile banking on this platform to their customers. A more involved type of mobile banking allows the user to log into his or her account from a cell phone, and then use the phone to make payments, check balances, transfer money between accounts, notify the bank of a lost or stolen credit, stop payment on a cheque, receive a new PIN, or view or download account statement. This type of banking is meant to be more convenient for the consumer than having to physically go into a bank, log on from their home computer or make a phone call. While all this is true, some are concerned about the security of mobile banking.

Mobile banking in a conceptual model is defined as: “Mobile banking refers to provision and availment of banking and financial services with the help of mobile telecommunication devices. The scope of offered services may include facilities to access customized information related to accounts, to administer accounts and to conduct bank and stock market transactions.” According to model, mobile banking can be said to consist of three inter-related concepts :-

a) Mobile Accounting

b) Mobile brokerage

c) Mobile financial information services

Most services in the categories designated accounting and brokerage are transaction based. The non-transaction based services of an informational nature are however essential for conducting transactions – like balance enquiries might be needed before doing money transaction. Therefore accounting and brokerage services are offered invariably in combination with information services. These information services may be offered as an independent module. Mobile banking may also be used to help in business situations as well as financial. Mobile banking can also be defined as an account is an administration gave by a bank or other monetary foundation that permits its clients to lead a scope of budgetary exchanges remotely offered over SMS, a service known as SMS.

According to data released by the Reserve Bank of India, the top five banks account for more than 92% of the entire value of mobile banking transactions in the country.

State Bank of India leads the pack with 36% market share, followed by ICICI Bank (21.5%), HDFC Bank (17.8%), Axis Bank (12.8%) and Kotak Bank (4.7%). These banks have managed to increase the number of mobile transactions by being proactive in development of mobile apps and making mobile banking feature-rich. According to Deepak Sharma, head of digital banking at Kotak Mahindra Bank, cstomers are leapfrogging to mobile banking directly from branch banking without using the browser. “around 35% of our online banking customers are coming in from their mobile phones without having used net banking,” he said. As against its market share of 1.4% of deposits, the bank has over 4.5% share of mobile banking. He said that online has already become the primary channel for most of the customers in the bank.

“Overall, 60% of fixed deposits have moved online. But if you look at only retail, nearly 80% of FDs are opened online,” said Sharma. He added that it was largely business that were obtaining fixed deposits in the branch.

“In terms of numbers of logins, mobile banking had overtaken net banking more than six months ago. Now mobile banking is ahead of net banking in terms of transactions as well,” said Sharma. He said that the fastest growing segment is online recharge, which is driving transactions.

“We are now getting more and more categories online, like bill pay and IPO subscription. We are also seeing systematic investment plans(SIPs) gaining traction. We feel that any simple product that is easy to start, liquidate and monitor will pick up online.” Said Sharma.

Services offered by mobile banking:

A typical mobile banking provide services
like:

Account information:

Mini-statements and checking of account

utilizing a cell phone.

1. Alerts on account activity or passing of set thresholds

2. Monitoring of term deposits

3. Access to loan statements

4. Access to card statements

5. Mutual funds / equity statements

6. Insurance policy management

Transaction:

1. Funds transfers between the customer's linked accounts.

2. Paying third parties, including bill payments and third party fund transfers.

3. Check Remote Deposit.

Investments:

1. Portfolio management services.

2. Real-time stock quotes.

3. Personalized alerts and notifications on security prices.

Support:

1. Status of requests for credit, including mortgage approval, and insurance coverage.

2. Check (cheque) book and card requests.

3. Exchange of data messages and email, including complaint submission and tracking.

4. ATM Location.

Content Services:

1. General information such as weather updates, news.

2. Loyalty-related offers.

3. Location-based services.

ADVANTAGES:

1.Time Saving:

Instead of allocating time to walk into a bank, you can check account balances, schedule and receive payments, transfer money and organise your accounts when you’re on the go.

2. Convenient:

The ability to access bank accounts, make payments, and even track investments regardless of where you are can be a big advantage Do your banking at a time and place that suits you, instead of waiting in queues.

3. Secure:

Generally, good mobile banking apps have a security guarantee or send you a SMS verification code you need to input to bank’s offeringsauthorise a payment for added history security. Mobile banking is said to be even more secure than online/internet banking.

4. Easy access to your finances:

With the introduction of mobile banking, you are able to access your financial information even beyond the working hours. It helps to avail banking services even by making a call to the bank.

5. Increased efficiency:

Mobile banking functions are functional, efficient and competitive. It also helps in decongesting the banking halls and reduces the amount of paperwork for both the banker and the customer.

6. Fraud reduction:

One very real advantage to implementing mobile banking. “Customers are being deputized in real time to watch their accounts.

7. It utilizes the mobile connectivity of telecom operators and therefore does not require an internet connection.

DISADVANTAGES:

1. Mobile banking users are at risk of receiving fake SMS messages and scams.

2. The loss of a person’s mobile device often means that criminals can gain access to your mobile banking PIN and other sensitive information.

3. Modern mobile devices like Smartphone and tablets are better suited for mobile banking than old models. Regular users of mobile banking over time can accumulate significant charges from their banks.

4. Even though there are 1.5 billion computers on the Internet and 4.5 billion people using mobile phones, there’s currently no significant operating system supporting the mobile space. “Hackers want to do the least amount of work for the biggest gain. Most mobile.

· Pervasive Transactions capabilities - Comprehensive “Mobile wallet”.

· Customer Education: - “Test drive” for demos of banking services.

· Connect with new customer segment: - Connect with Gen Y – Gen Z using games and social network ambushed to surrogate.

· Content monetization: - Micro level revenue themes such as music, e-book download

· Vertical positioning: - Positioning offerings over mobile banking specific industries

· Horizontal positioning: - Positioning offerings over mobile banking across all the industries

· Personalization of corporate banking services: - Personalization experience for multiple roles and hierarchies in corporate banking as against the vanilla based segment based enhancements in the current context.

· Build Brand: - Built the bank’s brand while enhancing the “Mobile real estate”.

6. Banking apps need an internet connection to be able to operate, so ifyou live in a rural area or experience problems with your internet connection, then you won’t be able to access your account. The same applies if your mobile phone runs out of battery.

7. Many phones aren’t yet compatible with anti-virus software. Most cell phones don’t come standard with anti-virus protection even if they have the capacity to browse the internet. Some phones aren’t even compatible with the anti-virus software available and there are known cases in which people were unable to put anti-virus software registered to them on corporate cell phones. Although identity thieves are still a few steps behind when it comes to learning to implement some of their most successful computer tricks (phishing, spamming, spreading viruses, account hacking, etc..) on a cell phone level, experts agree that is only a matter of time and people shouldn’t assume that anti-virus software isn’t necessary for cell phones.

8. Some banks don’t offer the same level of protection for cell phone banking that they do for online or in person transactions. Because the risks are still generally unknown some banks have been slow to make promises about what will or will not be covered when you use cell phone banking.

DEMONETISATION:

(A revolution in Banking)

What is Demonetisation? Demonetisation is the act of stripping a currency unit of its status as legal tender. It occurs whenever there is a change of national currency. The current form or forms of money is pulled from circulation and retired, often to be replaced with new notes or coins. Sometimes a country completely replaces the old currency with new currency.

On 08 November 2016, the Indian Government announced the demonetization of all ₹500 and ₹1,000 banknotes and the issuance of new ₹500 and ₹2,000 banknotes of the Mahatma Gandhi New Series in exchange for the old banknotes. The government claimed that the action would curtail the shadow economy and crack down on the use of illicit and counterfeit cash to fund illegal activity and terrorism. The sudden nature of the announcement and the prolonged cash shortages in the weeks that followed created significant disruption throughout the economy threatening economic output.

The BSE SENSEX and NIFTY 50 stock One of the great after effects of demonetization was that it made every mobile user having a bank account, literate about the Pros and Cons of mobile banking.

In a move to promote digital transactions post-demonetisation, the government on 03^rd Mar 2017 said it has asked banks to provide mobile banking facility to all its customers by the end of the current fiscal on Mar 31. “Ministry issues advisory to banks to enable mobile seeding, Aadhaar seeding of bank accounts along with enablement of Mobile Banking for all its savings bank customers on a campaign mode by 31 March 17”.

Facts and Figures of Demonization:

Up to 97% of the demonetized bank notes have been deposited into banks which have received a total of ₹14.97 trillion ($220 billion) as of December 30 out of the ₹15.4 trillion that was demonetised. This is against the government's initial estimate that ₹3 trillion would not return to the banking system. Of the ₹15.4 trillion demonetised in the form of ₹500 and ₹1000 bank notes of the Mahatma Gandhi Series, ₹9.2 trillion in the form of ₹500 and ₹2000 bank notes of the Mahatma Gandhi New Series has been recirculated as of 10 January 2017, two months after the demonetisation.

Future Prospectives in Mobile banking:

With the advent of technology and increasing use of advanced mobile information technology devices like Smartphones and tablets based devices, the use of Mobile Banking functionality would enable customers connect across entire customer life cycle much comprehensively than before. With this scenario, current mobile banking objectives of building relationships, reducing cost, achieving new revenue stream will transform to enable new objectives targeting higher level goals such as building brand of the banking organization. The objectives on the basis of functionality enrichment in Mobile Banking are:

Communication enrichment: - Video Interaction with agents, advisors.indices fell over 6 percent on the day after the announcement. In the days following the demonetization the country faced severe cash shortages with severe detrimental effects across the economy. This history making step of the Indian Government gave a punch to the Indian Banking Sector also together with the Indian economy.

Demonetisation also effected the Mobile banking service due to the great step of the Government. Due to shortage of cash in the market and banks people started adopting mobile transactions like EFT, NEFT/RTGS, online payment of bills, online purchase of goods and commodities etc. Different types of online payment mobile apps and web sites were used by the people of India. This sudden increase in Mobile banking transaction gave a great hike to online transactions between Dec 2015 to Dec 2016 which can be seen in the Figure 1 below as declared by RBI.

Problem Areas of Mobile Banking Customers:

· E-mail and web security.

· Identity theft.

· Handset operating ability.

· Not sure about the safety of the transactions.

· Mobile Security

· Network Availability

· Heavy transaction charges.

· Low rate of literacy in rural areas.

· Unawareness about new innovations.

· Application distribution.

· Inadequate guidance

SUGGESTIONS AND RECOMMENDATIONS:

1. Improvement should be done in maintaining service quality of communication, responsiveness, reliability and understanding.

2. Punctuality, transparency and accountability, Quality of customers services safety and confidentiality of transaction should be enhanced.

3. Banks should set standards for non-boarding mobile banking customers.

4. Banks should set standards for industry agreements between banks and MNOs for handling customer grievances.

Problem Areas of Mobile Banking Customers:

· E-mail and web security.

· Identity theft.

· Handset operating ability.

· Not sure about the safety of the transactions.

· Mobile Security

· Network Availability

· Heavy transaction charges.

· Low rate of literacy in rural areas.

· Unawareness about new innovations.

· Application distribution.

· Inadequate guidance

DO’s:

1. Sign-Up for SMS Alerts.

2. Frequently update you’re your device for security updates.

3. Keep your device antivirus updated.

4. Always check authenticity of the apps, before downloading.

5. Change your passwords every fortnightly.

6. Try to keep complex passwords like password with a combination of Capital and Small alphabets with numbers and symbols.

7. Always clear browsing history/cache after using banking services through browser.

8. Keep your phone locked with password or other security locking options.

9. Beware of unsolicited calls.

10. Use only official apps authorized by banks.

DON’T’s:

1. Don’t be in any doubt while using Mobile Banking.

2. Never share your OTP with anyone.

3. Never share your Mobile Banking App PIN with anyone.

4. Never save passwords when prompted by browser for auto-save of passwords.

5. Don’t click on malicious links.

6. Don’t use unauthorized apps for mobile banking.

7. Never store important personal information on your smartphone.

8. Don’t tamper with your mobile banking Apps security settings.

CONCLUSION:

New technology has rapidly altered the traditional ways of doing banking business. Customers can view the accounts, get account statements, transfer funds, purchase drafts by just making a few key punches. Availability of ATMs and plastic cards, EFT, electronic clearing services, internet banking, mobile banking and phone banking; to a large extent avoid customers going to branch premises and has provided a wider range of services to the customers.

Mobile banking is a system that allows customers of a financial institution to conduct a number of financial transactions through a mobile device such as a mobile phone or personal digital assistant.

Banking apps can make bill paying and bank account management incredibly convenient, but the risk of identity theft is a major downside. Fortunately, it’s easy to avoid most of the pitfalls with commonsense solutions like strong password protection and secure connections. By keeping these security tips in mind, one can enjoy a safer mobile banking experience. Thus we can conclude that mobile banking is a gain if we use it judiciously.

REFERENCES:

1. http://indianexpress.com/article/business/banking-and-finance/all-banks-must-enable-mobile-banking-by-march-31-government-4553195/

2. https://thehub.santanderbank.com/what-is-digital-banking-and-are-you-using-it-enough/

3. http://www.bullguard.com/bullguard-security-center/mobile-security/mobile-threats/safe-mobile-banking.aspx.

4. https://www.abcbank.net/why-use-online-banking/

5. https://en.wikipedia.org/wiki/Mobile_banking

6. http://indianexpress.com/article/business/banking-and-finance/all-banks-must-enable-mobile-banking-by-march-31-government-4553195/

7. http://economictimes.indiatimes.com/industry/banking/finance/banking/top-5-banks-generate-92-of-mobile-banking-value/articleshow/51508193.cms

8. https://www.rbi.org.in/

9. http://www.icommercecentral.com/open-access/factors-affecting-mobile-banking-adoption-behavior-in-india.php?aid=70187

10. http://timesofindia.indiatimes.com/

11. https://www.ecb.europa.eu/press/key/date/2007/html/sp070503.en.html.

Received on 13.08.2017 Modified on 07.09.2017

Asian Journal of Management. 2018; 9(1):217-222.

DOI: 10.5958/2321-5763.2018.00033.1