Text Message Blog |
The text message is money
Monday, August 10, 2009
U.S. banks are being left behind
Text messaging started as a popular way to send short notes; then photographs and video.
Next — money.
A report by Javelin Strategy & Research Inc. issued last month said that person-to-person, or P2P, mobile money transfers are on the rise and that financial institutions must step in or carriers will dominate the market. The report said 26 million consumers are "likely or extremely likely" to use this service, up 24 percent from 2008.
"Most of the time we find it in underdeveloped countries because people have mobile phones but not bank accounts," said Bruce Cundiff, director of payments research and consulting at Javelin.
Serge van Dam, head of marketing for mobile banking and payment company M-Com, said the U.S. banking system has slowed P2P's development in the United States.
"Regulatory intervention has forced banks [in other countries] to interconnect their networks, so you can easily do interbank payments," Mr. van Dam said. "Banks and providers can offer these services relatively easily, whereas in the U.S., the banking sector is a little more fragmented. There's a lot less regulatory intervention than there is in other countries."
Stessa Cohen, analyst for global research company Gartner, said that only 2 percent of the U.S. population has made a mobile-to-mobile money transfer in the last month, but the transfers are already very popular outside of the United States, where carriers have the edge in the market.
"If the banks don't act fast enough, you don't look at your phone and go, 'I really want to do this with my bank,' you go, 'Is it cheap? Is it fastest?'"
Art Kranzley of MasterCard MoneySend, said it works like this: The account holder puts in instructions to send the money on his phone via text message, then he will get a call asking him if he authorizes the transfer and asking him to enter his PIN number. Once he has done that and it has been authorized, he will get an e-mail telling him that the transaction occurred.
Javelin's report cited a lot of information on other countries' mobile markets that suggests banks may need to step up their efforts.
http://www.washingtontimes.com
Monday, August 10, 2009
U.S. banks are being left behind
Text messaging started as a popular way to send short notes; then photographs and video.
Next — money.
A report by Javelin Strategy & Research Inc. issued last month said that person-to-person, or P2P, mobile money transfers are on the rise and that financial institutions must step in or carriers will dominate the market. The report said 26 million consumers are "likely or extremely likely" to use this service, up 24 percent from 2008.
"Most of the time we find it in underdeveloped countries because people have mobile phones but not bank accounts," said Bruce Cundiff, director of payments research and consulting at Javelin.
Serge van Dam, head of marketing for mobile banking and payment company M-Com, said the U.S. banking system has slowed P2P's development in the United States.
"Regulatory intervention has forced banks [in other countries] to interconnect their networks, so you can easily do interbank payments," Mr. van Dam said. "Banks and providers can offer these services relatively easily, whereas in the U.S., the banking sector is a little more fragmented. There's a lot less regulatory intervention than there is in other countries."
Stessa Cohen, analyst for global research company Gartner, said that only 2 percent of the U.S. population has made a mobile-to-mobile money transfer in the last month, but the transfers are already very popular outside of the United States, where carriers have the edge in the market.
"If the banks don't act fast enough, you don't look at your phone and go, 'I really want to do this with my bank,' you go, 'Is it cheap? Is it fastest?'"
Art Kranzley of MasterCard MoneySend, said it works like this: The account holder puts in instructions to send the money on his phone via text message, then he will get a call asking him if he authorizes the transfer and asking him to enter his PIN number. Once he has done that and it has been authorized, he will get an e-mail telling him that the transaction occurred.
Javelin's report cited a lot of information on other countries' mobile markets that suggests banks may need to step up their efforts.
Example:
"Text PROMO to 63566 to join our list for special offers"
