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ContentsExecutiveSummary............................................................................................................................................iiiIntroductionandBackground..........................................................................................................................1Indianbankingandcellularmarket............................................................................................................................1BankingandMobilePhones:APotentiallyHappyIndianMarriage.............................................................3MobileBankinginIndiatoday.......................................................................................................................................5Technologicalandregulatoryfactorsimpactingfuturegrowth.....................................................................6

MobileBankinginIndia:BarriersandAdoptionTriggers.....................................................................9StudyObjectiveandDesign............................................................................................................................................9HowdoestheIndianconsumerbank?.....................................................................................................................10Issuesfacedintraditionalbanking.......................................................................................................................12

Awarenessandadoptionpatternsformobilebanking.....................................................................................14Sourcesofawareness.................................................................................................................................................14Triggersforadoption.................................................................................................................................................15Barrierstoadoption...................................................................................................................................................16Whoisusingmobilebankingtoday?...................................................................................................................19

Frequencyandpatternsofuseamongmobilebankingusers........................................................................21TypesoftasksbySECandovertenureofuse..................................................................................................22Post‐adoptionchangesintraditionalbranchbankinghabits...................................................................24

WhowillbethefutureusersofmobilebankinginIndia?...............................................................................24Likelihoodofusageamongcurrentnon‐users................................................................................................24Future:Drawingfromlowersocio‐economicstrata.....................................................................................25

Conclusion.............................................................................................................................................................27Appendix1:Somemobilebankingmodelsindevelopingcountries...............................................29Appendix2:SurveyQuestionnaire..............................................................................................................30RecruitingQuestionnaire..............................................................................................................................................30Screener................................................................................................................................................................................34DetailedQuestionnaire...................................................................................................................................................60Section1–OverallBankingInformation............................................................................................................60Section2–UsageofInternetbanking..................................................................................................................66Section3–UsageofMobileBanking....................................................................................................................68Section4:ExpectedUsageamongRespondentsaware(butnon‐users)ofMobileBanking.......73Section5‐Mobilephoneusage..............................................................................................................................76Section6‐PC/Internetusage...................................................................................................................................79Section7‐Demographics...........................................................................................................................................82

ExecutiveSummaryGlobally,mobilebankingserviceshavebecomeapopularmethodtoconductfinancialtransactions.India’smobilebankingsectorisinanascentstageandpoisedforrapidgrowth.Tobetterunderstandthissector,thisreportpresentsfindingsfromasurveyconductedinAprilandMay2012acrossfiveIndiancities.Respondentsinsocio‐economicclassification(SEC)A1‐2andB1‐2wereaskedanarrayofquestionsonbankinghabits,adoptionanduseofmobilebankingandcellularphoneusage.Keyfindingsofthesurveyinclude: Thereisconsiderabledissatisfactionwithtraditionalmodesofbanking

82%ofrespondentscomplainthattraveltimeisthetoppervasiveproblem Mobilebankingismorepopularthanbranchbankinginseveralcategories:58%of

customersdepositandtransferviamobilevs.44%atthebranch. Lessthan30%ofrespondentsuseInternetbankingforanytask.

Televisionandword‐ofmoutharethemostpopularsourcesofawarenessformobile

banking 62%ofm‐bankingusersand50%ofnon‐usersheardaboutmobilebankingfrom

family,friendsofcolleagues. Lessthan10%ofrespondentshearddirectlyfromtheirbanksaboutmobilebank

offerings.

Comfortandconvenienceisatoptriggerforadoptingmobilebanking 88%ofmobilebankinguserscitedthecomfortandaccessibilityoftheirphoneasthe

topreasonforadoption. Checkingandviewingbankbalancesisfirstandmostcommontask Experiencedusersusem‐banking50%moreweeklythannewusersandperformmore

sophisticatedtasks. 37%ofSECA1/A2respondentsusem‐bankingcomparedto23%ofB1/B2

respondents.

Technologyproblemsbiggestbarrierstoadoptionanduse Incompatiblecellphoneandmobilenetworkproblemstophurdlefor70%ofnon‐

adopters SECArespondentsarerelativelymoreconcernedaboutsecurityandcustomersupport

issues,SECBfacemoretechnologicalandawarenessproblems

Thirdgenerationcellulartechnologyandsmartphonesboostadoptionanduse 41%of3Guseralsousemobilebankingvs.30%of2Gusers 49%ofsmartphoneownersdom‐bankingwhile0%ofthosewithbasicphonedo Usersandnon‐usersofmobilebankinglookmuchmoresimilaroncetechnologyis

accountedfor.

Mobilebankingusersarehighlysatisfiedwithexperience 94%ofm‐bankinguserssayphysicalvisitstothebankhavebeenreducedsince

adoption. 90%ofuserswouldrecommendusetofamilyandfriends.

1  

IntroductionandBackgroundMobilebanking(m‐banking)hasemergedasapopularmodeofbankinginmanydevelopedanddevelopingcountries.InIndia,thereareapproximately12millionmobilebankingusersandthisfigureisexpectedtogrowrapidlywithmobiletransactionsexceedingcreditcardtransactionsbytheendofthedecade.Bysomemeasures,therearemoremobilephonesinIndiathantherearebankaccounts.Thecombinationoftwofactors—alargeunbankedpopulationandtheubiquityofcellphones—isacatalystforhighmobilebankingadoption.Tofullyunderstandthecurrentstatusandfuturetrendsinthismarketrequiressomecomprehensionofthegeneralbankingsector‐‐theturfwheremobilescompetewithphysicalbankbranchesandcomputers.Also,knowledgeofcellularphonepenetrationisneededtogetasenseofwhomobilebankingserviceswillreach.Thefollowingpagesprovideabriefbackgroundonthesetopicsandsomeinformationonthestructureandservicesinthemobilebankingsector.IndianbankingandcellularmarketBankingmodesavailabletotheIndiancustomerThereare80commercialbanksinIndia,operatingaround77,000branchesandwithover1millionemployees.Thesectorismainlycomposedofpublic,privateandforeignbanks.Inaddition,thereisalsoavastnetworkofruralbanksandcreditinstitutions.Butdespitesuchasprawlingnetworkofinstitutionsandmuchpushfromthegovernmentforfinancialinclusion,morethan70%ofIndia’spopulationremainsoutsidetheformalbankingsector.Inrecentyears,technologyhasexpandedchannelsthroughwhichconsumerscaninteractwiththeirfinancialinstitutions,providingnotonlyeasieraccesstotheexistingbase,butalsofacilitatingpenetrationoffinancialservicesamongthepopulation.Box1depictsthevariousbankingchannelsavailabletotheIndianconsumer.Brickandmortarbranchnetwork:BrickandmortarbranchesarethefoundationofIndia’sbankingsystem.InIndia,thesebranchescanrangefromcomplexoperationswithhundredsofemployeesindenseurbanlocationstoone‐man,single‐roombranchesinruralareas.Thenationalizationofbanksinthelate1960sandearly1980swasaccompaniedbygovernmentefforttowardsbringingmoreandmoreofthepopulationintothebankingnet.Tightregulationsgovernedtheexpansionofbranches,withaviewtoincreaseinclusion;bankswererequiredtoopencertainnumberofruralbranchesforanynon‐ruralbranchestheywantedtooperate.Despitesuchregulationsandencouragement,branchespercapitaremainamongthelowestinemergingmarkets(12000people/branch).ThetypicalscenarioinsideatraditionalIndianbankinvolveswaitinginlongqueuesevenforthesimplestoftransactions,suchasapassbookupdateorcashwithdrawal.AutomaticTellerMachines(ATMs):InnovationsinbankingdeliverychannelsstartedwiththeintroductionofATMsasaself‐servicedeliverychannelinthelate1990s.ATMsalsomarkedtheentryofanytimebankingascustomerscouldnowaccessmoneyfromtheirbankaccountsatatimeoftheirconvenience.Asof2012,ATMsremainthemostsuccessfuldeliverychannelinIndiafollowedbytelephonebankingandinternetbanking.Withabout75000plusoff‐branchandin‐branchATMsinstalled,banksareseekingtoreachouttoalargecustomerbaseatasubstantiallylowercost,givingthemeasieraccessandfasterservice.TheStateBankofIndiaandassociate

2  

banksownthelargestnumberofATMsat25,060.TheyarefollowedbyAxisBank(6,270),ICICIBank(6,104),HDFCBank(5,471)andPunjabNationalBank(5,050).1

Typically,atransaction,whichcostsRs.50atabranch,costsaboutRs.15ifdonethroughanATM.ResearchshowsthatthenumberoffootfallsatbankbrancheshasfallendrasticallyaftertheinstallationofATMs.InordertofurtherreducethecostofservicedeliveryandrevenuesthroughATMs,bankshavestartedout‐sourcingandsharingofATMservicesandcross‐sellingotherproducts.SomebankshavealreadystarteddispensingrailwayticketsandmovieticketsthroughtheirATMs.Inthefuture,abank’sATMmayfunctionlikeakioskdeliveringmanymorenon‐cashtransactions,furtherincreasingtheprofitabilityofATMs.

InternetBanking:Increasinginterestinself‐servicecontinuedandinternetusagepromptedbankstointroducetheconceptof“anywherebanking.”Customerscouldnowaccesstheirbankaccounts,checktheiraccountdetails,gettheirbankstatements,transfermoneytootheraccountsandpaytheirbillsfromthecomfortsoftheirhomeoroffice.InternetBanking,alsoofferedsignificantcostadvantagetobanks.Anet‐basedtransactioncoststhebankonlyaroundRs.4,whichismuchlowerthanevenanATM,mainlyduetosavingsonprohibitiverealestatecostsaswellaslaborcosts.2However,internetbankinghasgrownslowlyinIndiaduetoacombinationofpsychological,legal,technologicalandsocioeconomicfactors.Thebiggestlimitationofinternetbankingistherequirementofacomputerwithaninternetconnection,whichisnotacommonacrossIndianhouseholds.Alackofcriticalmassofearlyadopters,lackofastrongtrustenvironment,slownessinadoptionofinternet,lowpenetrationofPCsandaccesstointernetaresomeoftheimpedimentsintheadoptionofinternetbankinginIndia.SecurityissuesalsoloomlargeandcustomersrestrictusageofInternetbankingtotheirhomeandofficecomputers.

HighpenetrationandrapidgrowthintheIndiancellularmarket : ThespreadofmobilephonesacrossIndiaisoneofthemostremarkableeconomicandtechnologysuccessstoriesofthelast15years.Ithascontributedsignificantlytothegrowthandmodernizationofvarioussectorsandtheoverallsocio‐economicdevelopmentofIndia.

ThenumberofmobilephonesubscribersinIndiareachedawhopping916millionattheendofMarch2012.TheIndianmobilephoneindustryregisteredaconsistentoverallgrowthrateofaround45%annuallyintermsofsubscribers.Thesector,asshowninFigure1,remainscompetitivewithseveraldomesticandinternationalplayersvyingforthisgrowingcustomerbase.Today,amobilephonehasbecomeanessentialpartofanaverageIndian’sexistence.Thisisaresultofpositiveregulatorychanges,intensecompetitionamongmultipleoperators,low‐pricedhandsets,prepaidcards,lowtariffsandsignificantinvestmentsintelecominfrastructure.Thewell‐distributednetworkoftelecommunicationservicesinIndiahasresultedinwideningofmarkets,efficientinformationflows,lowertransactioncostsandaneffectivesubstituteforinfeasiblephysicaltransport.                                                            1Banksinstall19,000ATMsin2010‐11http://articles.economictimes.indiatimes.com/2011‐04‐08/news/29396871_1_atms‐npci‐national‐financial‐switch2RetailBanking:ChallengesAheadinDistributionChannelsinUrban/RuralIndia,RBIBulletin,January2004

 

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customers,aons.AsIndiaobaltrendsaanytimebantheirconvenhancedconsu

usinessmodeyareseekingres,byleveraheyarealsooenhanceth

mobilephoneendingfinannefitstoindieenfinancialfacturerswiveanyaccesstofthenearlinstitutional

SMSBanking

SubscribingforSMSalertsfromthebank.Receivingalertsincaseofcashwithdrawal,moneytransfer,credit/debitcardtransaction

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ndia’smigranhATMsandtoplestoreanriskfromtheachmonth,munbankedposeloansinstfmillionsofnngmarketswbillionmarktouch$350bMNOs),phonn.Mobilephgreatersignifndiahavemas.

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5  

technologiescostsonly$209.TheRBIreportsthatwhilethegovernmenttypicallyincursatransactioncostof12‐13percent,mobilebankingbringsthiscostdownto2percent.4Mobilebankingoffersthephysicalproximitythatothermethodslikebranchbankingandeventechnology‐basedchannelssuchastheInternetorATMs,cannotmatch.Withmobilebanking,customersnowessentiallycarrytheirbankwiththem,trulyfacilitating,anytime,anywherebanking.

Bankshavestartedofferinginformation‐basedserviceslikebalanceenquiry,stoppaymentinstructionofchecks,transactionsenquiryandlocationofthenearestATM/branchonmobilefunds.Acceptanceoftransferoffundsinstructionforcredittobeneficiariesofsame/oranotherbankinfavorofpreregisteredbeneficiarieshavealsocommencedinafewbanks.Additionally,thisnewchannelgivesthebankabilitytocross‐sellandup‐selltheirothercomplexbankingproductsandservicessuchasvehicleloansorcreditcards.

Sinceonly40percentoftheadultpopulationhasbankaccounts,whereasmorethan70percentofadultsownamobileconnection,linkingbankingwithtelecomseemstobethecorrectchoiceforIndia’scommercialbanks.Withalargemobilehandsetpenetration,itistheobviouschoicetocrosstheextremelylowcredit/debitcardpenetrationbarrier(whichisbelow10percentofthepopulation).Thehighpenetrationlevelsofmobilephonesandlowtransactioncostsinvolvedinmobilebankingarelikelytobethepotentialgrowthdriversfortheseservices.MobileBankinginIndiatodayMobilebankingbusinessmodels5ThepredominantmodelformobilebankinginIndiaisthebank‐ledmodelwhereinbanksarethefocalpointoftransactionsanditistheirbrandthatdominates.Mobilebankingisofferedtocustomers/depositorsoftheparticularbankandallaccountingandtransfersarethroughthebank.Avariantofthismodeliswheretelecomoperatorsandbankspartnertoofferservices.ExamplesofthesearejointventuresbetweenAirtelandAxisbankandVodaforeEssarandICICIBank.Often,thecellularserviceoperatorwillprovideacustomizedplatformorbuilt‐inapplicationstofacilitatem‐bankingtransactions.

Bankswithmobilebankingoptionsofferservicesinthegeneralcategoriesofaccountinformationprovision,paymentsandtransfers,investments,supportandcontentservices.Table2providesmoredetailsonthesesegments.Mostm‐banking/m‐paymentssystemsinIndiaenableuserstodo i) Storevalue(currency)inanaccountaccessibleviathehandset.Iftheuseralreadyhasabank

account,thisisgenerallyaquestionoflinkingtoabankaccount.Iftheuserdoesnothaveanaccount,thentheprocesscreatesabankaccountforherorcreatesapseudobankaccount,heldbyathirdpartyortheuser’smobileoperator.

ii) Convertcashinandoutofthestoredvalueaccount.Iftheaccountislinkedtoabankaccount,thenuserscanvisitbankstocash‐inandcash‐out.Inmanycases,userscanvisitacornerkiosk

                                                            4MobileBanking:OpportunitiesandchallengesintheIndianmarkethttp://www.tele.net.in/discussion‐board/item/7732‐mobile‐banking‐opportunities‐and‐challenges‐in‐the‐indian‐market5Morawczynski,O.&Miscione,G.(2008).“ExploringTrustinMobileBankingTransactions:TheCaseOfM‐PesaInKenya,”,SocialDimensionsofInformationandCommunicationTechnologyPolicy,pp.287‐298

6  

orgrocerystoreandtransactwithanindependentretailerworkingasanagentforthetransactionsystem.

iii) Transferstoredvaluebetweenaccounts.Userscangenerallytransferfundsbetweenaccountslinkedtotwomobilephones,byusingasetofSMSmessages(ormenucommands)andPINnumbers.

TechnologicalandregulatoryfactorsimpactingfuturegrowthInformationtechnologyholdsapromisetochangethefaceofconsumerbankinginthenextfewyearsthroughtheconvergenceofbankingandtelecomplayers.Technologywillbecomeimperativeinbankingforprovidingconvenienceinproductdelivery,increasingproductivityandperformance.AsmobilenetworksinIndiaareupgradedwithWAP,GPRSandUMTStodelivernext‐generationmultimediaservices,bankscanprovideahostofservicesonmobilephonesandwillhaveimmediateandfullcontrolovertheirfinances.Customerswillbeabletoviewtheiraccountstatement,transferfundsbetweenaccounts,getinstantnotificationswhenevertheytransact.Next‐generationmobilebankingserviceswilldeliversignificantimprovementswithuser‐friendlyicondriveninstructions,instantaccess,securityandimmediatetransactionprocessingallatalowercost.Bankscanalsoattainhigherlevelsofcustomersatisfactionandincreasedloyaltybyprovidinganywhere,anytimebanking.Theywillalsobenefitfurtherfromloweradministrativecosts,fewerbranches,reducedheadcount,streamlinedcallcentersandlowerhandlingcharges‐savingsthat,hopefully,willbepassedontocustomers.Consideringthefar‐reachingimpactofcertaintechnologies,weshouldexpecttoseemajorshiftsinthebankingindustryunlikeanywehaveseenbefore

Box2:Mobilebankingservice

AccountInformation

Mini‐statementsandcheckingofaccounthistory Alertsonaccountactivityorpassingofsetthresholds Monitoringoftermdeposits Accesstoloanstatements Accesstocardstatements Mutualfunds/equitystatements Insurancepolicymanagement Pensionplanmanagement

Payments&Transfers

Domesticandinternationalfundtransfers Micro‐paymenthandling Mobilerecharging Commercialpaymentprocessing Billpaymentprocessing

Investments Portfoliomanagementservices Real‐timestockquotes Personalizedalertsandnotificationsonsecurityprices

7  

Impactoflaunchof3GonmobilebankingservicesInIndia,thecurrent3Gfootprintislimitedtothemetrosandurban/semi‐urbanareas.Intheshortrun,3Gwillonlyhaveanindirectimpactasmobilebankingservicesarenotbandwidthintensiveand,thus,donotneedhigh‐speedconnectivity.However,soonenough,3Gwillbeakeyfactorinmobilebankinggainingtraction.Thisisbecauseitoffersincreasedsecurityprotocolsandmorebandwidthforsecuremobile‐basedtransactions.Thirdgenerationtechnologywillalsodrivetheuptakeofsmart‐phoneswhichwillenablemoresecureanduser‐friendlyinterfacesformobilebankingapplications.ManagingthenetworkserviceproviderrelationshipByvirtueofitsverynatureofoperation,mobilebankingbringsacertainclashofinterestwithrespecttoownershipofendcustomersandrevenuesharingbetweennetworkserviceprovidersandfinancialinstitutions.Networkserviceprovidersoffermobileservicesforusersandoftentheyalsoprovideheavilysubsidizedhandsets.Financialinstitutionssharearelationshipwiththecustomerintermsofholdingtheaccountandcreditcard,owningtheexpertisetoprocesstransactions,andsoon.Giventhisscenario,itisobviousthatthefinancialinstitutionmustclearlyestablishthedynamicsofthepartnership,forbusinessviability.Mobilebankingsolutionproviderswoulddowelltooptimizethedeploymentmechanismtoreducedependencyonnetworkserviceproviders,toaviableminimum.Prudentregulation:AkeyfactorinfuturegrowthAnumberofregulatorypoliciesstymiemobilebankinginIndia.Full‐scalecommercialimplementationofruralm‐bankingiscomplex,asitrequiresamultitudeofplayers,suchastelecomoperators,m‐bankingproductdevelopers,regulatorsandfinancialinstitutionstoenvisageandcoordinatedelivery.In2008,theReserveBankofIndia(RBI)laidoutoperatingguidelinesformobilebankingtransactions,whichincludemethodsforbankstocollaboratewithtelecomproviders,strengtheningthesecurityframeworkandlayingdowncommonstandardsforcompletingtransactions.TheReserveBankofIndiapermittedonlylicensedbankswithaphysicalbankpresenceinIndiaandbarsnon‐bankfinancecompaniesandmicrofinanceinstitutionstolaunchmobilebanking.Thisdisqualifiesmobilenetworkoperatorsfromofferingtheirownservice.Serviceswererestrictedtocustomersofbanksandholdersofdebit/creditcardsissuedasperRBIguidelines.

Support

Statusofrequestsforcredit,includingmortgageapproval,andinsurancecoverage

Checkbookandcardrequests Exchangeofdatamessagesandemail,includingcomplaintsubmissionand

trackingContentServices Generalinformationsuchasweatherupdates,news

Loyalty‐relatedoffers Location‐basedservices

8  

TheRBIhastakenastepforwardbyremovingtheRs50,000transactionlimitthroughmobilephoneswithaviewtoallowcustomerstotransferbiggeramounts.Howeverlendersmayplacepertransactionlimitsbasedontheirownriskperceptionwiththeapprovaloftheirboards.RBIhasalsoallowedbankstoappointfor‐profitbankingcorrespondents(BC),includingtelecomoperatorsandlimitsrelatingtohavingtheBCwithinafixeddistanceofthebankhavealsobeenrelaxed.TheregulationonmobilebankingismovingintherightdirectionbuttheRBIshouldlookatloweringtheentrycost.Forexample,theKnow‐Your‐Customer(KYC)norms6applicabletotelecomcompaniesratherthanbankingKYCrulesshouldbeadequateforopeninganaccount.Itisexpensiveforoperatorstocomplywiththeseregulationsespeciallywhencustomervolumeshavenotstabilized.Afewmoreenablingregulationslargelycenteredonunifyingaccountopeningandcontrolsbetweenoperatorsandbankwilllowercostandincreaseviability.Increasedviabilitywillensurefasterscale‐upandproliferationofservices.Theregulatorshoulddefinetheextenttowhichmobileoperatorscansubstituteorreplicateservicesthatbankstraditionallyoffer.TheRBIhasbeenreluctanttoallownon‐bankingplayersliketelecomoperatorstocarryoutbankingoperationsandrequiressuchservicestobeofferedinpartnershipwiththeexistingnationalbanks..Theseissuesneedtobeaddressedonthepolicyandregulationfront.Financialinclusionreformsshouldalsoprovidenormsformobilebankingfortheruralpopulation.Stringentsecuritynormsandaframeworkforpreventingfraudareneededtochangetheperceivedinsecurityofmobilebankingtransactions.TheRBIhasinthelastfewyears,takenpositivestepstowardsfacilitatinginter‐operabilityamongbanksformobilepaymentthroughtheinterbankmobilepayment.However,amoreintegratedapproachandframeworkformobilebankingistheneedofthehour.TheRBIstillhassomewaytogointermsoffacilitatingthemobileecosystemforgrowthwithanintegratedframework.Policy‐makersandregulatorsfacetwo‐foldchallengesregardingM‐banking:first,toencouragebanksandmobileoperatorstodevelopsolutionsthatarenotproprietaryandsecond,toallowaccesstopotentialnewentrantswhomaydisruptthelucrativebusinessmodelsofthebanksandmobileoperators.Thekeychallengeistodothiswhileatthesametimeensuringhighlevelsofsecurityandtrust.Itisimportantthatmobilebankingisnotseenasaturfwarbetweenthefinancialandtelecommunicationsectorsbutassomething,thatcomplementsexistingfinancialservices.

                                                            6KYCrulesrequirethatbanksrequireasystemofdocument‐basedregistrationandthemandatoryphysicalpresenceofthecustomertoopenaccounts

9  

MobileBankinginIndia:BarriersandAdoptionTriggersMobilebankinghasgrownatablisteringpaceinacrossmanydevelopinganddevelopedcountriesaroundtheworld.InIndiarelativetoaveryhighmobilepenetrationrate,theuseofmobilebanking(m‐banking)servicesremainslow.However,withnewcellulartechnologyasacatalyst,m‐bankinglookswell‐poisedtodrawinmillionsofnewusers,whotiredwiththelumberingbrickandmortarbankingfacilities,seektime‐savingandeasilyaccessiblealternativebankingmodes.StudyObjectiveandDesignThisreportpresentsfactsandanalysisonthebankinghabits,awareness,adoptionandusagepatternsamongm‐bankingusersandnon‐users.Itidentifiesfactorsthatwilldriveon‐the‐groundsuccessofmobilebankinginIndia.Todoso,wecollectdataonthebarrierslimitingadoptionofmobilebankingamongstnon‐usersandalsothetriggersthatledtoadoptionamongcurrentusers.Wesurveyed1614respondentsduringAprilandMay2012acrossfivedifferentgeographicallydispersedcitiesofIndiaDelhi,Mumbai,Lucknow,IndoreandKochi.7Theinitialscreeningonlyselectedrespondentswhowereawareofmobilebankingbutmayormaynothaveactuallyadoptedtheservice.8Classifiedonthebasisofsocio‐economicclass(SEC),therespondentsweredrawnfromclassesA1,A2,B1andB2onthis12‐gradescalewhichisbasedoneducationandnumberofconsumerdurablesowned.InIndia,thesefourSECrepresent11.8%ofthegeneralpopulationand25%oftheurbanpopulation.932%oftherespondentswereusersofmobilebanking.Detailedinformationwascollectedonavarietyofsubjects—bankspatronizedandbankinghabits,typesoffinancialtransactionsconducted,advantagesanddisadvantageofmobilebanking,cellularusageanddemographicfeatures.

Table1:Sampledistributionacrosscities

Delhi Indore Kochi Lucknow Mumbai TotalNonUserofM‐banking,AccountwithaPrivateSectorBank 102 101 100 102 102 507NonUserofM‐banking,AccountwithaPublicSectorBank 119 122 105 113 139 598UserofM‐banking,AccountwithaPrivateSectorBank 52 50 57 50 52 261UserofM‐banking,AccountwithaPublicSectorBank 48 50 50 50 50 248Total 321 323 312 315 343 1614

                                                            7DelhiandMumbaiareclassifiedas“Tier1”citiesandKochi,LucknowandIndoreareclassifiedas“Tier2”cities.Tier1citieshaveapopulationofover4millionwhileTier2citiespopulationis1millionto4million.8 Consumers were initially surveyed on the street briefly. Out of these respondents, only those consumers who were aware of M‐Banking were  later  interviewed  face‐to‐face  in  the CAPI  (Computer‐assisted personal  interviewing)  center.  The  interview work was fully controlled and any possibility of leaving out questions was eliminated. 9ThissystemisdevelopedbytheMediaResearchUsersCouncil(MRUC)andtheMarketResearchSocietyofIndia(MRSI).

10  

HowdoestheIndianconsumerbank?Asinthecaseofanyconsumerdecision,theadoptionanduseofmobilebankingdependsheavilyonhowattractivethealternativeproductis.ForIndianswithaccesstoformalbanking(thesegmentofthepopulationrepresentedinthissurvey)brickandmortarbranchesarethetraditionalmodeofconductingbankingtransactions.Weaskedrespondents,whoallhaveaccountsineitherpublic(49%)orprivatebanks(51%),abouttheiruseandsatisfactionwiththeseservices.Mostconsumersphysicallyvisitedabranchbankonceamonthorless.Themostwidelyperformedbranchbankingactivitiesrevolvearoundviewingbalancesandtransfer/depositingmoney.Intheprecedingthreemonths,86%ofusershadtransferredanddepositedmoneyand82%hadcheckedtheirbalance.Adistantthirdwastaskspayinginsurancepremiums(20%).Thereismuchlessactivityinmoresophisticatedtaskssuchasinvestinginshares(10%),creditcardtransaction(6%)ormutualfundactivity(4%).

Table2:Bankingactivities

Activitiesdoneinlast3months AllUsers M‐Bankingusers M‐Bankingnon–users

Base: 1614 509 1105PaymentofBills 53% 38%Transfer/depositmoney 86% 86% 85%Check/Viewaccountbalance 82% 90% 78%Payinsurancepremium 20% 26% 17%MonitoringDeposits/Fixed/RDs 7% 7% 7%Investinsharemarket 6% 7% 5%Requestchequebook 15% 17% 13%ViewMiniStatements 15% 18% 13%ViewLoanstatements 8% 10% 6%ViewCreditCardStatements 10% 10% 10%InvestinMFs 4% 6% 3%Stoppaymentoncheques 8% 11% 7%Functionalitytostop,changeanddeletepayments/ECSLinkingaccountforAutoDebit 4% 6% 3%PINprovision 7% 11% 5%Updatingpassbook 17% 12% 19%ThereissomeheterogeneitybySECinthetypesofbankingactivitiesdoneatthephysicalbranch,morewell‐offandeducatedclasses(SECA)withpresumablymoreadvancedfinancialknowledge,moreresourcesandhigherpotentialreturnstendtodomorecomplexfinancialtransactionslikeinvestinginshareormutualfundsandcreditcardactivity.However,thebiggestdifferenceacross

11  

classesemergesonthedimensionofhowthesetransactionstakeplace.AsFigure2shows,themajorityindividualsinupperclassesdepositortransfermoneybysomeothermediumratherthanphysicallyvisitingabranch.ThisproportiondecreasesaswegodowntheSECscale.

Figure2:Physicalbranchastopmodefordeposits/transfers

 

Thispicture,whichcouldbereplicatedforavarietyofotherbankservices,showsthatmoreeducatedandwell‐offindividualsarefindingconvenienceinnon‐traditionalbankingmodeslikeATM,internet,mobileorphonebanking.Althoughnotexplicitlydefinedinthesurvey,manyofthehigherclassesreportedusing“Other”modeswhichmostlikelymeanstheyareusingdomestichelporassistantstoconductbankingactivity.Eventhoughbankbranchesarelocatedmoreconvenientlyforaffluenthouseholds,theiropportunitycostoftimeisalsoincentivizingthemtoavoidcrowdedandtime‐consumingbankbranches.

Interestingly,thedataalsoshowsthatinternetor“net”bankinghasnotcaughton.Lessthan25%ofcustomersuseonlineservicesforbanking.Inmanyservicecategories,thereisevidenceofa“leapfrogging”effect.Consumersareskippingoveranintermediatebankingmodesuchasinternetorphonebankingandadoptingthelatesttechnologyi.e.mobilebanking.Forexample,amongstthosewithaccesstomobilebanking,47%usebranchbankingforpayingbills,25%useinternetbankingand40%usem‐banking.

 

 

 

 

0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

SECA1 SECA2 SECB1 SECB2

%respondents

12  

Figure3Modesofbankingfordifferenttasks

Branch ATM Net Mobile Phone Other

PaymentofBills 47% 16% 28% 40% 1% 6%

Transfer/depositmoney 44% 29% 27% 58% 1% 4%

Check/Viewa/cbalance 25% 60% 22% 66% 1% 3%

Payinsurancepremium 32% 13% 31% 40% 3% 10%

MonitoringDeposits/Fixed/RDs 30% 22% 16% 16% 0 22%

Investinsharemarket 8% 8% 17% 36% 6% 31%

Requestchequebook 44% 30% 3% 34% 2% 14%

ViewMiniStatements 24% 50% 21% 47% 3% 10%

ViewLoanstatements 30% 23% 2% 25% 2% 30%

ViewCreditCardStatements 49% 24% 14% 16% 4% 16%

InvestinMFs 22% 22% 13% 34% 0% 22%

Stoppaymentoncheques 37% 7% 17% 54% 6% 15%Functionalitytostop,changeanddeletepayments/ECS 23% 19% 10% 35% 3% 29%

PINprovision 18% 45% 20% 45% 4% 13%

PassbookUpdate 93% 0 0 0 0 7 

IssuesfacedintraditionalbankingThemovementawayfrombrickandmortarbankingisnotsurprisingasthereisconsiderabledissatisfactionwithtraditionalbankingalongseveraldimensions.Respondentscomplainedabouttheamountoftimeandenergytheyhadtoexpendtomerelycommutetotheirbank.Mostconsumersalsocomplainedaboutinordinatedelaysandharassmentfacedinsidethebank.Usuallythisphysicalbranchbankinginvolveswaitinginserpentinequeuesandmovingfromonecountertoanothertogetevenbasictasksaccomplished.

13  

Figure3: Problemswithtraditionalbanking

Visitingabankphysicallyistime‐consumingandconsumerssaidtheyareforcedtodefer

otherimportantworktotraveltoabank.Infact,morethan50%oftheconsumersrankeditasoneoftheirtopthreeproblems.Almostoneofeverythreebankingusersneedstotravelmorethan2kilometerstoreachouttoitsnearestbankbranch,withanaveragetimeof17‐18minutes.ThisproblemismarginallybetterinTier1citieswhereaveragedistancesandtraveltimestobankbranchesareshorter,butitremainsdaunting.Moreover,sincelowerSECstendtolivefartheronaveragefrombankbranchesonaveragetheseproblemsaremagnifiedforthem.TheopportunitycostoftimemaybelowerforlowerSECssothatwaitinginaqueueisrelativelylessexpensiveforasmallshopkeeperthanahighpoweredexecutive.Butonnet,thesluggishIndianbankinginfrastructureinordinatelyburdensevenlowermiddleclass(SECB)bankingcustomers.Respondentswithaccountinprivatebanks(bothdomesticandforeign)tendtobelessdispleasedwiththeirbankingexperienceintermsofcustomerserviceanddelaysthatthosewithaccountsinpublicsectorinstitutions.Also,notethatthedifferencesmaybehigherthatthenumbersshowbecausecustomersoftherespectivetypesofbanksarenotsimilari.e.privatebankcustomerstendtobemoredemandingaswell.Butthelatterdobetteronthelocationalfront,whichisnotsurprisingaspublicsectorbanksoftenhavethepickofchoicelocationsavailableatsubsidizedrates.Overall,however,thefiguressuggestthatbanksinIndiahavenotliveduptheexpectationsoftheircustomers.

82737375

7172

646363636166

5654

50

TimewastedtravellingMovefromonecountertoanotherone

LongqueuesUnabletolocateabankbranchwhiletraveling

InconvenientbranchlocationsNotaccessible24*7

PoorserviceUnhelpfulbankemployees

InadequateknowledgeofthestaffErrorsinrecordingtransactions

NocustomisedservicesChequeclearancenotreflectedonthesameday

PoorbankinfrastructureBetterservicesatotherbanks

Unreliableinpast

14  

Figure3:%respondentsinstrongagreement

Holdaccountinpublicsectorbank

Holdaccountinprivatesectorbank

“Iendupwastingalotoftimetravellingtobank” 82% 86%“Ihavetomovefromonecountertoanothertogetworkdone”

69% 65%

“Bankemployees/frontdeskexecutivesatthebankarenotwillingtohelpme”

56% 54%

ItisimportanttokeepinmindthatproblemsofaccessandserviceexistonanevenlargerscaleforlowerSECs(classificationsC‐E)whoarenotincludedinthesurvey.BranchespercapitainIndiastillremainamongthelowestintheworldandbasicaccessremainsapervasiveproblem.Inspiteofabigpushbythegovernmenttowardsfinancialinclusion,lessthan80%ofthepopulationhasaccesstoformalsectorlendingrepresentingfertilegroundsformobilebankingtomakeinroads.AwarenessandadoptionpatternsformobilebankingSourcesofawarenessBysurveydesign,allrespondentsinthesurveywereawareofmobilebanking.Televisionandword‐of‐mouthandinternetarethetopsourcesforawarenessoverall.Word‐of‐mouthisparticularlyeffectiveforusers.

Figure4:Sourcesofawarenessformobilebanking

 

62

60

55

53

41

28

13

9

50

62

33

48

39

22

11

4

Friends/family/Colleaguesusingtheservice

Television

Internet

AttheBankbranch

Newspapers/Magazines/OtherPrintads

ThroughtheMobileServiceprovider

Directmailers

Callfromabank M‐BankingUser M‐BankingNon‐User

15  

Moreandmoreconsumersrelyonadvicefromfriends,familyandevenstrangerstomakepurchasedecisionsintechnologyenabledbankingservicescategoryespeciallyM‐banking.Thesurveyreinforcedwhatalmosteverybusinesspersonknows,thebestleadorreferralisoftentheonethatcomesstraightfromthemouth—asatisfiedcustomer’smouth,thatis.AsurprisingfactgiventhatIndiahasabank‐ledmodelformobilebanking,banksarenotamoreprominentsourceofawareness.Only5%ofpeopleheardaboutm‐bankingservicesthroughtheirbank.Additionally,mobileprovidersarenotprominentsourceofinformation(23%).Aswewillseebelowwhendiscussingbarrierstoadoption,eventhougheveryoneinthesurveyisawarethatbankingthroughamobiledeviceispossible,under‐awarenessisthepressingproblem.Potentialusersoftendonotrealizetheextenttowhichm‐bankingcanmakebankingmoreefficientandlowcost.Intheseembryonicstagesofgrowth,banksandmobileprovidersmustdriveawarenessabouttheirproducts.Thefindingthatword‐of‐mouthandpeeruseissoimportanttoawarenessimpliesthatreachingacriticalmassofuserswillbevitaltopropellingm‐bankingforward.ThisfactalsopointstolowSECgroups,whereadoptionmaybemuchbelowthecriticalthreshold,asanimportanttargetformarketers.TriggersforadoptionWhenaskedwhatattractedthemtotheservice,thecomfortandconvenienceofusingtheircellphoneemergedasthetopreasonformostusers.Asdiscussedearlier,cellphoneshavemadedeepin‐roadsamongtheIndianpopulation.Allsegmentsofindividualsandhouseholdshaveoneandareadeptatusingit.Theideaofdoingbasicbankingonsuchafamiliardeviceistheimmediateattractionofmobilebanking.Thefigurebelowshowsthesevarioustriggersforadoption.

16  

Figure5: Triggersforadoption

Asweseeabove,mostrespondentsfamiliarityandcomfortwiththeircellulardeviceisimpetusforventuringintonewapplicationssuchasm‐banking.Toprankinggiventoseveralbankingcategoriessuchas“Usingamobileforbankingmakesbankinghassle‐freeandeffortless,”“Icandobankinganytime/anywhere(24/7banking),”and“Bankingthroughthemobilesavesalotoftime”alsounderscorethetimeandenergysavingadvantagesthatm‐bankingpresentsovertraditionalbanking.Ontheotherthelowrankingofcertaincategorieslike“mobilebankinghasauser‐friendlyinterface”and“abilitytoconductfinancialtransactions”highlightcertainareas,specificallyimprovinguser‐technologiesandcateringtosmallercustomers,thatm‐bankingprovidersmustbettertogetmoretractionintheIndiancontext.Theideathathavingtherightcellphoneisakeyfactorbehindadoptionisreinforcedifwelookatthebarriersratherthantriggerstoadoption.BarrierstoadoptionOverall,wecanclassifythehurdlesthatrespondentsstatedasreasonsfornotusingmobilephonestofourmajorcategories‐‐lackofawareness,technologyproblems,securityconcernsandsupportissues.Box3categorizesthespecificstatementsevaluatedinthesurveyunderthesefourbroadareas.

88

88

85

84

84

84

83

83

83

80

Icandobankinganytime/anywhere

BankingthroughthemobilesavesalotoftimeUsingamobileforbankingmakesbankinghasslefree

andeffortless

MobilebankinghasauserfriendlyinterfaceAbilitytoconductfinancialtransactionsofeven

smallerdenominationsConsistentserviceexperience,ashumanintervention

islessIstartedusingMobileBankingasmostofmyfriends

andcolleagueswerealsousingit

ItakekeeninterestinnewertechnologiesItinvolveslowercostascomparedtothetraditional

andoldermodesofbanking

 

Box3:M

Figure6reasonin“mobilepadoption

Aw

“Notmanycurrently“Icurrenttheneed”“Notaspobanking”“Itisexpemobileforactivities”“Don’tkno“M‐bankinversatilee“M‐bankincomplicat

ajorcategor

showsthepnnotadoptinphoneneedst.Varioussup

wareness

ypeopleIknowusem‐bankingtlydon’thave

opularasnet

ensivetouserthese”owmuchaboutngservicesnotenough”ngistootedtouse”

riesofbarri

ercentageofng.Technolotobecompatipportissues

wg”

t”

T

“Mobilebecombankin“Attimmobile“Datattooslow

ierstomobi

fnon‐userregyissuesi.e.ibleformobiandneedfor

Technology

ephoneneedstmpatibleform‐goperations”

mesthereisnonetwork”

ransmissioniswonthemobile

ilebanking

espondentsth“attimesthelebankingoprmorecusto

to

e”

“Anyodetailmobil“Possim‐baninInte“M‐baandsefinanc

adoption 

hatrankedaereisnomobperations”aromersupport

Security

onecanmisuselsincaseIlosemle”

ibilityoferrorsnkinghigherthernetbanking”

ankingisnotasecuremodetodcialtransaction

acertainissubilenetworkarethebiggestcomeinsec

mymy

sinan

safedons”

“Theinterexeccont“Lacacknthettime

eastheirtopavailable”anthurdlestocond.

Support

ereisnohumanrfaceorservicecutivethatyouctactwithquesti

ckofnowledgementotransactionates”

17 

 

pnd

necanons”

of

 

Figure

ThedataAlthoughsameholtheywereotherhancustomerbanking,potentialTheresulbankingagainacceconcerneworryabmoredemperspectiamonglo

e6:Respond

alsoshowsthtechnologydsforawareealsoknewlnd,SECAresrsupport.Thbanksandteusersbutadltsalsosuggealternatives,sstofinanciaedaboutsecuoutsecuritymandingandive,itmightbowerSECsco

dentswhor

thatdifferentisthetopconenessaslowelessaboutthspondentsexhesefindingselecomoperaddressheteroestthattrustlowerSECsaalservices.Hurityissues.Handtrustiss

dalsobeconcbeeasiertoest‐effectively

ranksecuritm

tSECsattribuncernforeveerSECswereheservicesanxpressedmorconveythatatorsmustnoogeneouscontandsecurityaremorewilHigherSECswHowever,thisues.Asconscernedaboutenrollandexy.

31

164

ty(top)ormmobilebanki

uteddiffereneryone,itcarelesslikelytondadvantagereworryabotoensurewotadoptaonncerns.yareasortollingtouseawhohavereaisdoesnotmsumersenroltsecurity.Buxpandfinanc

SECA SEC

SECA SEC

mobilecovering

ntweightstorriedmoreimohavepeersesmobilebaoutsecurityawideadoptionne‐size‐fits‐a

ofluxurygoonyformofbasonablefinameanoverthellintheseserutfromanimialinclusion

47

CB

148

CB

rage(bottom

odifferentcamportancefosusingmobilankinghadtoaswellasgetnandproliferallapproachi

od;facedwithankingthateancialserviceelong‐termbrvices,theyammediateadothroughmo

7

8

m)as#1bar

tegories.orSECB.Thlebankinganoodder.Onthttingapproprationofmointargeting

hpoortraditenablesthemesaremorebanksneednarelikelytoboptionbilebanking

18 

rrierto

 

endheriatebile

tionalmto

notbe

g

19  

Figure6: Barrierstoadoption

 

Whoisusingmobilebankingtoday?Mobilebankingadopterstendtoberelativelyyoung,betweentheagesof26‐35years.Sincethesurveywasconductedinurbanareas,illiteracyoronlyprimaryeducationwasnotcommon.Levelsofsomecollegeeducationwereroughlythesameamongbothusersandnon‐users,butm‐bankinguserstendedtohavemorehighereducationandnon‐userstendedtohavehigherfractionofthosewithonlysecondaryeducation.Morestudentswerem‐bankingusersaswereworkingprofessionally.Finally,mobilebankingusersbelongtothehighsocio‐economicgrades(A1andA2). 

 

 

 

 

 

 

 

 

706767666563626159595858565554

IncompatiblephoneNomobilenetworkattimesNotmanypeopleIknowuse

NohumaninterfaceorserviceexecutiveNoneed

InternetbankingmorepopularLackofacknowledgementinreceivingtransaction

ExpensivetousemobileforthisFearoflosingphoneanddata

Don'tknowmuchaboutm‐bankingorhowtouseDatatransmissionslowonmobile

ServicesnotversatileenoughHighpossibilityoferrorsToocomplicatedtouse

Notsecureandsafe

20  

Figure7:Characteristicsofusersandnon‐users

M‐BankingUsers M‐BankingNonUsersBase 509 1105Age18‐25Years 44% 48%26‐35yeas 40% 36%36‐45years 16% 14%46‐55years ‐ 3%EducationalStatusSchool5to9Years ‐ 1%SSC\HSC 6% 14%SomeCollegebutnotGraduate 20% 19%Graduate\PostGraduate:General 59% 58%Graduate\PostGraduate:Professional 15% 8%OccupationalStatusStudent 25% 30%WorkingProfessionals 34% 29%Businessman 24% 24%SelfEmployedProfessional 4% 3%Housewife 8% 9%SECA1 33% 20%A2 36% 34%B1 23% 29%B2 9% 17%IndividualIncome(MonthlyAverage,Rs.thousands) 35.1 26.9HouseholdIncome(MonthlyAverage,Rs.thousands) 86.4 56.4

Mobilebankingusersalsousemoreadvancedphones.10

                                                            10Basicphoneisonewithminimalfeatureslikecalling,sendingtext,receivingcallsandmayhaveradiowithnooptionofcamera,mediaplayer,videosorinternetaccess.Multimediaphonecanhandlemusicpicturesandvideos.Smartphonesallowuserstostoreinformation,email,installprograms,clickpictures,storeimagesandvideos.Thesearephoneswhereapplicationsfromathirdpartyareaccessible.Seeappendixforpictures.

21  

Figure8:%mobilebankingusersbySECandphonetype

Basic Multimedia Smartphone All SECA1 0 41% 50% 43% SECA2 0 27% 56% 33% SECB1 0 27% 40% 27% SECB2 0 17% 37% 19% All 0 28% 49% 32%

Manyoftheentry‐levelhandsetsthatareprevalentinIndiadonotsupportapplicationslikeJAVAandinternetbrowsing.Theyarebrowser‐unfriendly,andhavemonochromatic,low‐resolutionscreens,whicharedesignedtodelivervoiceratherthandata.Additionally,3Gtechnologyalsoencouragesadoption. 

Figure9:%mobilebankingusersbySECandcelltechnology

2G 3G All

SECA1 42% 48% 43% SECA2 32% 36% 32% SECB1 24% 39% 26% SECB2 20% 29% 21% All 30% 41% 32%

Thus,thedatasuggeststhatlackoftechnologyandmobileinfrastructureremainsabighurdletoadoption.However,therapid3Gexpansionandfallingpriceofsleekerandmoreuser‐friendlyhandsetsshouldencouragethelarge‐scaleadoptionofsophisticatedmobilebankingapplications.Banksandmobilephoneprovidersthatarepreparingtoprovideexcellentmobilebankingservicesintheimmediatefuturethereforehavegreatpotentialforlargescaleandrapidadoptionofmobilebankingservices.FrequencyandpatternsofuseamongmobilebankingusersMovingbeyondadoption,thesurveygatheredinformationonusagepatternsofadopters.Onaverage,M‐bankingusersusedmobilebankingservice.97timesaweek.Mostusersuseditonceamonth,followedbyalargegroupofweeklyusers.Thefrequencyofusageincreaseswiththeexperienceoftheuser.Themostrecentadoptersofmobilebankingusetheservice.80timesaweekwhilethemostexperiencedonesaverage1.24timesweekly.Thefirstmobilebankingservicethatconsumerstendtouseisofthesimplestkind—checkingorviewinganaccountbalanceontheirphone.Fortysixpercentofrespondentsacknowledgedthisastheirfirsttypeofmobilebankingtransactionfollowedby31%statingthattransferringordepositingmoneywastheirfirstone.

22  

TypesoftasksbySECandovertenureofuseOvertime,thenatureofthetaskstendstobecomemorecomplex.Bankingtransactionsthatnecessitatemoretrustandconfidenceinmobilebankingasamediumalsoriseoverthetenureofuse.Newcustomerstendtosimplycheckorviewaccountbalancesmorecomparedtoexperiencedusers.

Figure10:%usersfirsttransactionusingmobilebanking

Figure11showsfourdifferentbankingtasksthatincreaseincomplexity.Basicaccountbalanceviewingissimplygatheringinformation.Transferringofmoneyrequiresahigherleveloftrustandproficiency.Movinghigherontheladderofcomplexity,moreinvolveddecisionisneededwheninvestinginmutualfunds.Andfinallythetaskrequiringthehighestleveloftrustandcomplexityiselectronicclearingservices(ECS)whichmovesfundamongdifferentbankaccountsoftenautomatically.Weseethatusersnewtom‐bankingaremostlikelytotransfer/depositfundsandviewbalancesbutdomuchlessoftheothertwotasks.Userswhohavebeenm‐bankingfortwoyearsormore,spendrelativelylesstimeonthebasictransactions.

   

4632

1022211111

23  

 

 

Similarly,higherSECsalsoconductmoresophisticatedtransactions.ThisisinpartbothbecausehigherSECsaremorelikelytohavebeenlongerusersofm‐bankingbutalsobecausethereishigherdemandfortheseservicesbythem.Largerwealthandportfoliodiversificationelicitsmoreneedforcertainbankingtransactions.Asbankingneedsbutalsotimeconstraintsincrease,mobilebankingoffersanefficientandhassle‐freewaytomanagefinances.Hencewhilebankscanacquirenewcustomersrelativelyeasilythroughsimpletransactions,theyshouldbepreparedtoprovidehigherqualityandmorecomplexservicesascustomersbecomemoreexperiencediftheywouldliketoretainsuchcustomersinthefaceofcompetingbanksaugmentingtheirmobileservices.ThisisparticularlyimportantforthehigherSECcustomersrequiringmorecomplexservices.

Figure12: TypeoftransactionsbySEC

ViewingBalance Transfer/deposit Investing ECS

SECA1 62% 79% 25% 0%SECA2 75% 64% 50% 54%SECB1 61% 67% 18% 29%SECB2 54% 47% 33% 22%

40%

79%

25%

0%

62%

47%

33%

22%

Viewingbalance

Transfer/Deposit

InvestinginMF

ECS Lessthansixmonths 2+years

Figure11:Typeofm‐bankingtasksbylengthofadoption

 

Post‐adoMobilebatheirphomanycatinsurancesubstantitraditionahavebeen

Overall,3increaseslargerredgeneral,mexperienc“extremeTheserescontacttocustomerexpenseoloyaltyatWhowiLikelihooAlmostfobankingigivensom

optionchangankingusersonetodobantegoriessuchepremiumsivecategoryalbankinghanreduced.

31%ofresposmonotonicaduction.Simimobilebankice.Almost70ely”likelytor

sultsareproomobilebanrsatisfactionofhigherchutlowercostsillbethefodofusageouroutoffivinthefuture.meguidance

R

Figure1

gesintraditstendtousenkingbusineshastransfer/andinvestinwheremobilabitshavech

ondentssaytallywithm‐bilarly,higheringusersacr0%ofusersrrecommend

misingtobankingmakesnassociatedwurn.Ifhowev.Weassesssfutureuseamongcurrvenon‐users.And20%oandsupport

Reducedalot

13:Changein

tionalbrancbrickandmoss.M‐bankin/depositmonginmutualflebankusershangedsince

therehasbeebankingtenurSECresponrossthesociorateit“verym‐bankingt

nks.Customitmorecostwithmobilebver,customersatisfactionwrsofmobirentnon‐useinthesurvefthosewhotindoingso

63

6

Reduced

nphysicalb

chbankinghortarbankslngisthemosney,automatfunds.Infactspreferbraneadoption,m

enabigdecrurewith42%dentsalsohao‐economicsgood”or“exoothers.

ervisitstopeffective.Hobankingishirsatisfactionwithmobilebilebankinerseyrespondedexpressedso(bottom).

316

tosomeexten

bankvisitss

habitsless,onlyabostcommonmticpaymentst,paymentofnchbanking.m‐bankingus

easeinphys%ofthemostavehigherraspectrumarexcellent”and

hysicalbranowever,onenigh.Ifnot,onnisgreater,obankingnextnginIndia

dthattheyaromereluctan

1

nt Nocha

incemobile

out80%asmmodeoftranss,checkingbafbillsremainAskeddirecersagreetha

icalvisits.Thexperiencedatesofsubstieverysatisfialmost70%

nchesarecosneedstoassenemayloweronemayindut.?

reextremelyncewouldlik

ange

ebanking

muchastheysactionacrosalances,payinstheonlyctlyabouthoatphysicalvi

hisfiguredusersclaimitution.Inedwiththeirare“very”o

tlyandshiftiesswhetherrcostattheucegreater

likelytousekelyconvert

24 

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ror

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Future:DWehavericher,webettersutakinginthousehol

Table5sandalsoapercentagbranchbaconditionsignificanmobileba                  11In‐depth

Figure14:

Drawingfroseenthatuseealthieranditedtohighetoaccountthldsface.

showsthem‐amongthesugepointmorankingishignon3Gtechnntly.Thus,onankinguse.11

                       analysisinSud

Notatalllikel

%Non‐user

omlowersocersofmobilebelongtohigersocio‐econhetechnologi

‐bankingadoubsetofresprem‐bankinggheramongtnologythatisncetechnolo1

                   dhirandTewari

4

ly Notver

rslikelytoc

cio‐economebanking,bogherSECs.Tnomicstrata.icalconstrain

optionanduspondentsusingusersthantheformerass,eliminaterogyisaccoun

i(2012)

42

13

rylikely So

18

convert;ifgi

icstrataothintermsoThismayleadHowever,thntsandbank

seacrossSECng3GtechnoSECBandthswell—therrespondentsntedforSECs

1 63

omewhatlikel

2 11

68

1

ivensomeg

ofgreateraddtotheconchiswouldbekingalternati

CA(A1+A2)ology.Weseehattherelativratiois70%with2G,thelookmuchm

39

ly Verylik

guidance(bo

doptionanduclusionthatmhastyconcluiveswhichp

andSECB(ethatoverSveamountsomore.Howeesedifferencemoresimilar

kely Extre

ottom) 

usage,tendtmobilebankiusionwithoupoorer

B1+B2)overECAhas13ofm‐bankingever,onceweesgodownintermsof

melylikely

25 

 

tobengisut

rall

gtoe

26  

Table3:AdoptionanduseacrossSECs

SECA SECB Difference

%M‐bankingusersAll 37% 24% +13 with3G 42% 38% +4

Mobilephone/Branchuseratio

All ~1.7 1 +.7 with3G 1.7 1.4 +.3

Aswehaveseen,oneofthetopconstraintstoadoptionofmobilebankingistheperceptionthattheuser’scellphoneisnotconducivetomobilebanking.Itistheleadingreason(followingunavailabilityofamobilenetwork)thathindersmobilebankingusage,bothontheintensiveandextensivemargins.Giventhatmore3Gsmartphoneusersaredoingmobilebanking,thisproblemiscloselytiedtothepredominantuseofsecondgenerationbasicormultimediadevicesoverthirdgenerationsmartphones.Evenamongmobilebankingadopters,thosewitha3Ghandsetusetheircellphoneforbanking.38timesweeklycomparedto.28timesweeklybytheir2Gcounterparts.Thirdgenerationsmartphonesarestilloutofthepricerangeoflessaffluenthouseholds.Butrapidlyadvancingtechnologyispushingpricesdownandremovalofthistechnologicalconstraintforpoorerhouseholdisimminent.Oncethishappens,mobilebankingislikelytotakeoffinabigaway.

Onanotherdimension,poorbankinginfrastructurehascreatedapent‐updemandformobilebanking.Althoughallsurveyrespondentshaveabankaccount,thereisdissatisfactionacrossallSECswiththeseservicesamongvariousdimensionsespeciallyintermsoftraveltimetobanks,inconvenientlocationofbranchesandamountoftimespentinthebranch.TheseissuesaremagnifiedamonglowerSECs.Theytendtoexpressevenmoredissatisfactionabouttraditionalabankingmethodwhichisnotsurprisingbecausetheytendtolivefartherfrombanksandhavelimitedresourceslikedomestichelp,computersorphonestoskipphysicalvisits.Onthesupplyside,bankshavenotdoneagoodjobservicingthesesmallercustomers.Richerconsumers,ontheotherhandhavefoundthatmobilebankinganeffectivewaytocircumventissues.Thiswasevidencedbythefactthatmobilebankingusers,inspiteofbeingwealthierwithpresumablybetteraccesstobanks,tendtophysicallyusebanksless.Sotheworseconditionsintraditionalbankingforlessaffluenthouseholdswillattractthemtomobilebankingasahassle‐freewaytodobanking.Thus,habits,preferencefortraditionalbankingorsocio‐economicstatusarenotlikelytobebarrierstoadoptionandusage.The“pull”factorofcheap,new3Ghandsetscombinedwiththe“push”factoroflumberingtraditionalbankinginfrastructurearelikelytoresultinrapiddemandformobilebankingacrossavarietyofusers.

27  

ConclusionMobilebankingprovidesthepromiseofexpandingboththequalityofbankingservicesandreachofbankingservicesinalargecountrylikeIndiainacost‐effectivemanner.Usingaconsumerlevelsurvey,weinvestigatedconsumerneedsthattriggersadoptionandbarriersthanservetolimitadoptionofmobilebanking.Wealsoevaluatedthesatisfactionwithmobilebankingandhowadoptionofmobilebankingchangesusageoftraditionalbankingservices.Ourkeyfindingsandtakeawaysareasfollows:Thereislatentdemandformobilebankingbothamongthericherupperclassesandpoorermiddleclasses.Theuppermiddleclassesaredrawnbythepossibilityofsuperiorservicethatsavestimeandprovideanytimeanywhereaccesstomobilebanking.Thepoorermiddleclasseswhohavelimitedaccesstotraditionalbankingservicesfindthetraditionalalternativetobeverypoor,thatmobilebankingevenatthemostbasiclevelareattractivetothem.RicherSECsarealsomoreconcernedaboutissuesofsecurityandtrust.Assophisticatedcustomers,theyhavehigherexpectationstoenterthemobilebankingcategory,giventheirhigherlevelsofsatisfactionwiththecloseralternative,traditionalbanking.HencemobilebankingservicequalityislikelytobeanimportantcompetitiveweaponinattractingandretainingcustomersfromhigherSECsinthefuture.WefindusersevenfromlowerSECsgraduatetousingmoresophisticatedtransactionsovertime,andcanbecomemoredemanding.SowhileimmediateadoptionamonglowerSECsmaybepossiblebysimplyprovidingthemtheoption,theirlong‐termretention,especiallyasbankscompeteonthequalityofservicesprovidedrequiresgreaterinvestmentineaseofuseandqualityofservices.Bankscandomoretoinstillawarenessoftheirmobilebankingservicestoincreaseadoption.Customersseemtolearnmoreaboutmobilebankingfromfriendsandrelativesthanfromthebanksthemselves.Giventhattrustandwordofmoutharelikelytobeusefulintheadoptionofservices,smallreferralincentivesmayacceleratetheshifttomobilebanking.Giventhelowercostsofservicesthroughmobilebanking,evenwhenbankbranchesarepresent,itisinthebank’sinteresttoencouragesuchadoption.Banksmayalsowishtopartnerwithmobilephoneserviceproviderstohaveappsinstalledonhandsetsthatmakesiteasiertoaccessbankingservicesthroughthephone.Giventhefairlyhighlevelsofsatisfactionwithmobilebankingservices,relativetotraditionalbankingservices,theshiftmaynotonlybefavorableintermsofcosts,butalsointermsofcustomersatisfactionandretention.Mobilebankingmightthereforetrulybeawin‐winforbanksandcustomers.LowerSECshavelowerratesofadoptionofmobilebankingservices.Howevercloserinspectionrevealsthatthisisnotduetolackofinterestandresistancetoadoptnewbehaviors,butduetolackofaccesstothecomplementaryinfrastructureofsmartphonesand3Gservices.Giventhatpricesofsmartphonesareexpectedtoplummet,and3Gpenetrationarelikelytoexpanddramatically,thereissubstantiallatentdemandwaitingtobefilled.Banksthatarewell‐preparedtoleverageanddealwiththispotentialexplosionindemandarepoisedtogainsubstantialmarketshareoverthenextfewyears.

28  

Overall,mobilebankingseemstobeanideawhosetimehascome.Ourresearchsuggeststhatsupplysideconstraintsarethebottleneckstoadoption;consumersarereadyandwaitingtoadopt.Giventheexpansionofhigherbandwidthdataservices,andacceleratedpricedropsofsmartphones,investmentsbybanksineasy‐to‐useinterfacescoupledwithmarketingoftheservicesislikelytohavelargescalepayoffsforbanksatthefrontier. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

29  

Appendix1:Somemobilebankingmodelsindevelopingcountries12TableA1:Mobilebankingmodelsinemergingmarkets

Model Lead

Bank/telecom Modeofaction

Philippines

SMART(bank‐led)GCASH(telecom‐led)

BancoD’Oro/SmartTelecomGlobeTelecom

ConventionalATM,POSareusedthroughdebitcard

Paymentviavaluechain,accountmanagement Bankssignupaccount Accountsmanagedbymobilenetworkoperators

(MNOs),bankshavereal‐timeaccess CoreprocessingsystemlieswithMNO,bank

holdsdeliverychannel

Kenya M‐Pesa(telecom‐led) Safaricom Safaricomismainlyapaymentproviderforthe

microfinanceinstitutionFAULU Paymentsareconductedviaairtimeagents

SouthAfrica MTN(bank‐led) StandardBank,MTN

Clientsopenbankaccountsthroughremote,interactiveprocess

MobilemoneystarterpacketsareavailableviaMTNagentsandbankbranches

CoreprocessingsystemlieswithMNO,bankholdsdeliverychannel

Indian Bank‐ledmCHECKAirtelStateBankofIndia,ICICI,Citibank

Mobilepaymentisrestrictedtobankaccountholders,residentsofIndiaandtransactionsinIndianrupees

Nointerbanknetworkavailable Bankscanmakemultilateralagreementsto

createmobileswitches

Pakistan Bank‐led UBL Accountholdercaninitiatetransactionvia

mobilewiththehelpofaninteractivevoiceresponse

ConventionalATM,POSareusedasdeliverychannel

 

 

 

 

                                                            12AnotherusefulresourceisthetheConsultativeGrouptoAssistthePoor(CGAP)report“BranchlessBanking2010:Who’sServed?AtWhatPrice?What’sNext?”providesdataanddescriptionofvariousmobilebankingandmobilepaymentsystemsindevelopingnations.Itisavailableat:http://www.cgap.org/gm/document‐1.9.47614/FN66_Rev1.pdf

30  

Appendix2:SurveyQuestionnaire

RecruitingQuestionnaireNAMEOFRESPONDENT:Mr./Mrs._________________________________________SURNAME_______________________ADDRESSINFULL:

BUILDING/PlotNAME/NO.:_____________________________________FLAT/ROOMNO.:_______FLOORNO.:____STREET/ROADNO./NAME:___________________________LocalityName______________________________________AREANAME:_______________________CITY/District/village:________________________PINCODE:________Talukaname:LANDMARK:__________________________________________________________________________________________EMAILADDRESS:______________________________________________DATASUPPLIERNAME:_______________________________DATAVERIFIERNAME:____________________________Mobilenumber:____________________________LandlineNumber:_____________________

Q1 IDENTIFICATIONNUMBER.

(R1) AREANO.

(R2) G.C.No.

(R3) LISTINGNO.

(R4) MAINNo.

(R5) D.S.No.

(R6) D.V.No.

31  

Q2 Q.C[MA][SA]

RQAC CBAC RQBC CBBC RQTBC

CBTBC RQVC CBVC RQSCR

CBSCR

(R1) D.V(SIGN./DATE) 01 02 03 04 05 06 07 08 09 10 (R2) OC/OE/SOE(SIGN./DATE) 01 02 03 04 05 06 07 08 09 10 (R3) OM/SM(SIGN./DATE) 01 02 03 04 05 06 07 08 09 10

Q3a DateofInterview[dd/mm/yy]

Pleaserecordusingtheshortdateformat(dd/mm/yy).Forexample,ifthedateis21December2005,recordas211205

Q3b RECORDTIMEINTERVIEWSTARTED/ENDED

Pleaserecordusing24‐hourformat.Forexample,ifthetimeis2:47pm,recordas1447

Q3c TimeEnded(24‐hourformat)

Q3d InterviewerName

Q3e InterviewerIDNumber

Q3a Q3b Q3c Q3d Q3e

32  

DateofInterview[dd/mm/yy]

TimeStarted

(24‐hourformat)

TimeEnded

(24‐hourformat)

InterviewerName

InterviewerIDNumber

(R1) INTERVIEWDETAILS ______ ____ ________________ ______

Q4 RecordContactNo:

(R1) TelephoneNo.Resi

(R2) TelephoneNo.PP(C/O)

(R3) TelephoneNo.Office

(R4) MobileNo.Self Q5 RECORDCENTER[SA] Code Route

Mumbai 01 Delhi 02 Lucknow 03 Kochi 04 Indore 05ASKTOSPEAKTOANYADULTMEMBERINTHEHOUSEHOLDINTHEAGEBAND18‐55YRS,WITHANACTIVEBANKACCOUNT.Goodmorning/afternoon/evening.Mynameis..........IamaninterviewerfromTheNielsenCompanyLimited.whichisamarketresearchcompany.Weareconductingasmallsurveyandwouldappreciateifyoucouldspareafewminutestoanswerourquestions.Pleasebeassuredthatallyouranswerswillbekeptstrictlyconfidential.

Q6 SHOWCARD

Canyoupleasetakealookatthiscardandtellmewhetheryouoranymember

Code Route

33  

inyourhouseholdworksinanyofthefollowingtypesoforganization.[SA]

Banks 1 CLOSE FinancialInstitutions 2 CLOSE Telecommunications‐MobileServiceProviderCompany/HandsetManufacturers 3 CLOSE Marketresearch 4 CLOSE

AdvertisingorPRagency 5

CLOSE

Media/Radio/Newspaper/Magazine 6 CLOSE Manufacturer/Wholesaler/RetailerofconsumerelectronicslikeTV,refrigerator,etc 7

Companymanufacturingsoap/toiletries…________________ 8

Governmentinstitutions 9

Noneoftheabove 10

Q7 ASKALL

Haveyoubeeninterviewedbyanymarketresearchagencyinthepast6months?[SA]

Code

Route

Yes 1 CLOSE No 2

34  

Screener(Administeredtoalltherespondents)

Q1. SHOWCARD

ASKALL

CanyoupleasetakealookatthiscardandtellmethehighestlevelofeducationoftheChiefWageEarnerinyourhousehold?ByChiefWageEarner,Imeanthepersonwhocontributesthemaximumtothemonthlyhouseholdincome.[SA]

Code

Route

Illiterate 1 Literatebutnoformalschooling 2 School‐Upto4years 3 School‐5to9years 4 SSC/HSC 5 SomeCollege(includesaDiploma)butnotGrad 6 Graduate/PostGraduate:General 7 Graduate/PostGraduate:Professional 8

Q2. a SHOWCARD

ASKALL

CanyoupleasetakealookatthiscardandtellmetheoccupationalpositionoftheChiefWageEarnerinyourhousehold?ByChiefWageEarner,Imeanthepersonwhocontributesthemaximumtothemonthlyhouseholdincome.PROBEFORDESIGNATIONORLEVEL.

[SA]

Code

Route

Unskilledworker 01 Skilledworker 02 Pettytrader 03

35  

Shopowner 04 Businessman/Industrialistwith‐ Noemployees 05 Businessman/Industrialistwith‐ 1‐9employees 06 Businessman/Industrialistwith‐ 10+employees 07 Self‐EmployedProfessional 08 Clerical/Salesman 09 SupervisoryLevel 10 Officer/Executive‐Junior 11 Officer/Executive‐Middle/Senior 12

Education Illiterate SchoolUpto4th

School5th–9th SSC/HSC

SomeCollege(includesa

Diploma)butnotGrad

Graduate/post

graduategeneral

Graduate/postgraduate

professionalOccupation 1 2 3 4 5 6 7Unskilled 1 E2 E2 E1 D D D DSkilledworker 2 E2 E1 D C C B2 B2Pettytrader 3 E2 D D C C B2 B2Shopowner 4 D D C B2 B1 A2 A2Business/indust’listwithnumberofemployees

None 5 D C B2 B1 A2 A2 A1 1‐9 6 C B2 B2 B1 A2 A1 A1 10+ 7 B1 B1 A2 A2 A1 A1 A1

Selfemployedprofessional 8 D D D B2 B1 A2 A1Clerical/salesman 9 D D D C B2 B1 B1Supervisorylevel A D D C C B2 B1 A2Off/exec–junior B C C C B2 B1 A2 A2Off/exec‐mid/senior C B1 B1 B1 B1 A2 A1 A1

50  

Q2b CODESECQ1*Q2a[SA]

Code

Route

SECA1 1 SECA2 2 SECB1 3 SECB2 4 SECC 5 CLOSE SECD 6 CLOSE SECE1 7 CLOSE SECE2 8 CLOSERECORDRESPONSESFORQ3TOQ7INTHEGRIDBELOW

Q3.Canyoupleasetellmeyourageincompletedyears

Q4.RecordGender

Q5.Doyouholdasavingsbankaccount?SA

Q6.Doyouownamobilephoneservice?HereIamreferringtonotonlyowningamobilephonebutalsoanactiveconnection?SAQ7.IFCODEDYESINQ6,ASK,isyourmobilephoneabasicphone,MultimediaphoneorSmartphone.IFTHERESPONDENTOWNSMORETHANONEPHONE,ASKFORTHEONEHEUSESMOSTOFTEN.SA

Interviewershouldexplainwhateachtypeofphonemeans:

ByBasicphoneImeanaphonewithminimalfeatureslikecalling,sendingtextSMS,receivingcalls,mayhavearadioservicewithnooptionofcamera,mediaplayer,videosorinternetaccess.Multimediaphoneistheonethatcanhandlemusic,picturesandvideos.Smartphonesallowuserstostoreinformation,e‐mail,installprograms,clickpictures,storeimages&videos.Thesearethephoneswhereapplicationsfromthirdpartyareaccessible.eg.Facebook

51  

NameQ3. Age Q4. Gender Q5. BankA/c Q6. Cellphone Q7. Typeofcellphone

Male Female Yes No Yes No Basic Multimedia Smart

1 2 1 2 1 2 1 2 3

CONTINUEONLYIF:

1. SECABHOUSEHOLD(CODED1TO4INQ2b)2. RESPONDENTAGEBETWEEN18‐55YEARS(REFERQ3)3. BANKACCOUNTHOLDER(CODEDYESI.E.1INQ5)

Q8.

Q9. a

Q9.b

Youmentionedthatyouhaveasavingsbankaccount.Inwhichallbanksdoyouhaveasavingsaccount?[MA]

IFCODEDMORETHANONEOPTIONINQ8,ASKQ9a,ELSECODETHESAMEBANKASCODEDINQ8UNDERQ9a:Ofallthebanksyouhaveanaccountin,whichisyourmainsavingsbankaccount;bymainImeanthebankwithwhichyoudothemaximumnumberoftransactions?[SA]

IFCODEDMORETHANTWOOPTIONSINQ8,ASKQ9b:Andwhichoftheseistheotheraccountwithwhichyoudothenexthighestnumberoftransactions?[SA]

Q8.Bankaccountsowned

Q9.a.MainBankaccoun

t

Q9b.OtherBankaccount

PUBLICSECTORBANK

AllahabadBank 1 1 1

AndhraBank 2 2 2

BankofBaroda 3 3 3

BankofIndia 4 4 4

BankofMaharashtra 5 5 5

CanaraBank 6 6 6

CentralBankofIndia 7 7 7

52  

CorporationBank 8 8 8

DenaBank 9 9 9

IDBIBank 10 10 10

IndianBank 11 11 11

IndianOverseasBank 12 12 12

OrientalBankofCommerce 13 13 13

Punjab&SindBank 14 14 14

PunjabNationalBank 15 15 15

StateBankofIndia 16 16 16

StateBankofBikaner&Jaipur 17 17 17

StateBankofHyderabad 18 18 18

StateBankofMysore 19 19 19

StateBankofPatiala 20 20 20

StateBankofTravancore 21 21 21

SyndicateBank 22 22 22

UCOBank 23 23 23

UnionBankofIndia 24 24 24

UnitedBankofIndia 25 25 25

VijayaBanka 26 26 26

PRIVATESECTORBANK

AmericanExpressBank 27 27 27

AxisBank(FormerlyUTIBank) 28 28 28

BarclaysBankPLC 29 29 29

BNPParibas 30 30 30

CitibankN.A. 31 31 31

53  

CityUnionBank 32 32 32

DBSBank 33 33 33

DeutscheBankAG 34 34 34

DhanlaxmiBank 35 35 35

FederalBank 36 36 36

HDFC 37 37 37

HSBC 38 38 38

ICICIBank 39 39 39

IndusIndBank 40 40 40

INGVysyaBank 41 41 41

Jammu&KashmirBank 42 42 42

JPMorganChaseBank 43 43 43

KarnatakaBank 44 44 44

KarurVysyaBank 45 45 45

KotakMahindraBank 46 46 46

LakshmiVilasBank 47 47 47

RoyalBankofScotland 48 48 48

SouthIndianBank 49 49 49

StandardCharteredBank 50 50 50

TamilnadMercantileBank 51 51 51

UBS 52 52 52

Yesbank 53 53 53

OthersPleaseSpecify____________________________ 99 99 99

54  

Q10.NowIwillshowyouafewconcepts.Iwouldliketoknowifyouhaveheardofthesebefore.

Q10.a.MBANKINGSHOWCARD:m‐BankingorMobileBankingisatermusedtodefinebankingoverthemobilephonewhichwouldincludeusingtheinternetbrowseronthemobilephonetoaccessthebankwebsiteandthendoanyofthefinancialactivitieslikepayingutilitybills,transferringmoney,payinganinsurancepremium,etc.OR,usingamobileApplicationforeasyandsimpleaccesstotheBankMobilewebsitetoperformfinancialactivitieslikeviewingthebankbalance,transferringmoney,etc.

Awareofm‐Banking Code Route

Yes 1 GotoQ10b No 2 CLOSE

10bNowIwillreadoutafewfinancialactivitiesthatweusuallydoinourdaytodaylife.IwouldliketoknowwhichofthesehaveyouheardarepossiblethroughyourmobilephoneorthroughMBanking.READOUTEACHACTIVITYONEBYONEANDCODETHEONESTHERESPONDENTISAWAREOF[MA]

Q10b.Awareofmbanking

(R1) Deposityourtelephone/mobilebills,utilitybillslikeelectricitybill 01

(R2) Transfer/depositmoney 02

(R3) Check/Viewaccountbalance 03

(R4) Payinsurancepremium 04

(R5) MonitoringDeposits/Fixed/RecurringDeposits–Short&Longterm 05

(R6) Investinsharemarket 06

(R7) Requestchequebook 07

(R8) ViewLastfewtransactions/MiniStatements 08

(R9) ViewLoanstatements 09

(R10) ViewCreditCardStatements 10

(R11) InvestinMutualfunds 11

(R12) Stoppaymentoncheques 12

55  

(R13) Functionalitytostop,changeanddeletepayments/ECSLinkingaccountforAutoDebit13

(R14) PINprovision‐ChangeofPIN/Password 14

(R15) Noneoftheabove 15

TERMINATETHEINTERVIEWIFTHERESPONDENTISNOTAWAREOFANYTHEACTIVITIESINQ10b,I.E.IFCODED15,NONEOFTHEABOVEINQ10b

Now,Iwouldliketoexposeanotherconcepttoyou.Pleasetellmeifyouhaveheardofthisbefore?

Q11.a.INTERNETBANKINGSHOWCARD:Internetbankingallowscustomersofabanktoconductfinancialtransactionsonasecurewebsiteoperatedbythebank.Toaccessabank’sonlinebankingfacility,acustomermusthaveInternetaccessandshouldberegisteredwiththebankinginstitutionfortheservice,andsetupsomepasswordforcustomerverification.[SA]

AwareofInternetbanking Code Route

Yes 1 GotoQ11b No 2 GotoQ12a

Q11bNowIwillreadoutfewfinancialactivitiesthatweusuallydoinourdaytodaylife.IwouldliketoknowwhichofthesehaveyouheardarepossiblethroughtheInternet.READOUTEACHACTIVITYONEBYONEANDCODETHEONESTHERESPONDENTISAWAREOF[MA]

Activities Q11.b.AwareofInternetbanking

(R1) Deposityourtelephone/mobilebills,utilitybillslikeelectricitybill 01

(R2) Transfer/depositmoney 02

(R3) Check/Viewaccountbalance 03

(R4) Payinsurancepremium 04

(R5) MonitoringDeposits/Fixed/RecurringDeposits–Short&Longterm 05

(R6) Investinsharemarket 06

(R7) Requestchequebook 07

56  

(R8) ViewLastfewtransactions/MiniStatements 08

(R9) ViewLoanstatements 09

(R10) ViewCreditCardStatements 10

(R11) InvestinMutualfunds 11

(R12) Stoppaymentoncheques 12

(R13) Functionalitytostop,changeanddeletepayments/ECSLinkingaccountforAutoDebit 13

(R14) PINprovision‐ChangeofPIN/Password 14

(R15) Noneoftheabove 15

57  

Q12a.

Q12b.

TalkingaboutMobileBanking,canyoupleasetellmewheredidyouhearaboutM‐Banking?[MA]

IFAWAREOFINTERNETBANKINGI.E.CODEDYESINQ11aANDCODEDATLEASTONEACTIVITYINQ11b,THENASK:AndwheredidyouhearaboutInternetBanking?[MA]

Q12a‐Mbanking

Q12bInternetBanking

ReadaboutitinNewspapers/Magazines /OtherPrintads ........................................ 01 01 HeardaboutitonTelevision ......................................................................................................... 02 02 Directmailers.................................................................................................................................... 03 03 AttheBankbranch.............................................................................................................................. 04 04 ThroughtheMobileServiceprovider .................................................................................... 05 05 Friends/family/Colleaguesusingtheservice........................................................................ 06 06 Internet.................................................................................................................................................... 07 07 Callfromabankinformingaboutm‐Banking/InternetBanking.................................... 08 08 AnyOther(Pleasespecify)............................................................................................................... 09 09 Providedbythe

bankUsedbyyou

Q13a

Q13b

Q14a

Canyoupleaselookatthiscardandtellmewhichallfacilities/servicesareyouawareofthatareprovidedbyyourmainbank______(READOUTBANKCODEDUNDERQ9a)?

ASKQ13b,IFANOTHERBANKCODEDUNDERQ9b.Nowcanyoupleasetellmewhatallfacilities/servicesareyouawareofthatareprovidedby__________(MENTIONBANKCODEDUNDERQ.9b)?[MA]

Outofallthebankingservices/facilitiesthatyoumentionedareprovidedbyyourMainbank______(READOUTBANKCODEDUNDERQ9a),whichallservices/facilitieshaveyouusedinthelast3months?[MA]

Outofallthebankingservices/facilitiesthatyoumentionedareprovidedbyyournextmostusedbankaccount______(READOUTBANKCODEDUNDERQ9b),

Q13a.MainBank

____

Q13b.Otherbank___

Q14a.MainBank

____

Q14b.Otherbank

______

58  

Q14b

whichallservices/facilitieshaveyouusedinthelast3months?[MA]

Branch Banking (Physically visiting bank for any financialtransactions/activities)............................................................................. 01 01 01 01

ATMBanking(PhysicallyvisitinganATMtodoanyfinancialtransactions/activities)............................................................................... 02 02 02 02

Internet Banking (Using the Internet to do any financialtransactions/activity).................................................................................. 03 03 03 03

MobileBanking(Usingtheinternetbrowseronthemobileora mobile application to perform any financial activity/transaction) ................................................ 04 04 04 04

SMS Banking (Subscribing for SMS alerts from the bank.Receivingalerts incaseofcashwithdrawal,moneytransfer,credit/debitcardtransactionetc) 05 05 05 05

Phone Banking (Transacting over the phone with the bankhelpline/callcenter) 06 06 06 06

Doorstep / Home Service (Having some one visit you fromthe bank at your home to carry out your financialtransactions/activity) 07 07 07 07

59  

RECRUITMENTQUOTAS:

TOBEAUTOCODEDBYTHEPROGRAMMERDEPENDINGONTHERESPONSESINTHESCREENER:

SEGMENT CODE INSTRUCTIONS

Aware–NonUserofM‐banking,AccountwithaPublicSectorBank 1

1. CODED1INQ10aANDATLEASTONEACTIVITYINQ10b2. NOTCODED4I.E.MOBILEBANKINGINQ13aANDQ14aUNDER

MAINBANK3. CODEDANY1TO26UNDERQ9a

Aware–NonUserofM‐banking,AccountwithaPrivateSectorBank 2

1. CODED1INQ10aANDATLEASTONEACTIVITYINQ10b2. NOTCODED4I.E.MOBILEBANKINGINQ13aANDQ14aUNDER

MAINBANK3. CODEDANY27TO53UNDERQ9a

Aware–UserofM‐banking,AccountwithaPublicSectorBank 3

1. CODED1INQ10aANDATLEASTONEACTIVITYINQ10b2. CODED4I.E.MOBILEBANKINGINQ13aANDQ14aUNDERMAIN

BANK3. CODEDANY1TO26UNDERQ9a

Aware–UserofM‐banking,AccountwithaPrivateSectorBank 4

1. CODED1INQ10aANDATLEASTONEACTIVITYINQ10b2. CODED4I.E.MOBILEBANKINGINQ13aANDQ14aUNDERMAIN

BANK3. CODEDANY27TO53UNDERQ9a

60  

DetailedQuestionnaire

Section1–OverallBankingInformationNowIwillreadoutafewfinancialactivities.PleasethinkofyourMainbankaccountonlywhileansweringthefollowingquestions,i.e.savingbankaccountwith________________(ProgrammertoinsertthenameofthebankfromQ9aabove)

Q16a.Canyoutellmewhichofthesefinancialtransactionshaveyoudoneinthelast3months?[MA]

Q16b.ForeachoftheactivitycodedinQ16a,Interviewertoask:Pleasehavealookatthisshowcard.AsIreadeachactivitydonebyyou,pleaseletmeknowwhichmodes/serviceshaveyouusedforperformingthisactivity.INTERVIEWERTOREPEATTHISQUESTIONFOREACHACTIVITYCODEDINQ16a[MAforeachactivity]INTRUCTIONFORPROGRAMMER:ALLMODES/SERVICESCODEDUNDERQ14a,SHOULDBECODEDUNDERQ16bASWELL

SHOWCARD:ListofMODES/SERVICES

1)UsedBranchBankingi.e.visitedthebranchphysically.Herewearereferringtoeitheryouvisitingthebankphysicallyorsomeotherfamilymembervisitingthebankandgettingtheactivitydoneonyourbehalf

2)UsedATMBanking‐>i.e.visitedanearbyATM

3)UsedInternet/NetBanking

3)UsedMobileBanking

4)UsedPhoneBankingi.e.transactedviaBankCallcentre(Helpline)

5)Doorstep/HomeServiceSomeonefromthebankvisitedyourhome

6)OthersPlsspecify

Q16c.IFCODEDMORETHAN1MODE/SERVICEINQ16bFORANYOFTHEACTIVITIES,INTERVIEWERTOASK:Fortheactivity_______________(PROGRAMMERTOINSERTTHEACTIVITYFROMQ16a)whichisthemostoftenusedmode/service?[SAforeachactivity]

61  

Q16d.IFMORETHANONEMODE/SERVICECODEDINQ16bFORANYACTIVITY,ASKQ16dFORTHATACTIVITYELSESPECIFY10UNDERTHESAME.Assumingthatyou_____________(PROGRAMMERTOINSERTTHEACTIVITYFROMQ16a)10timesinthelastthreemonths,whatwastheproportionofusing_______(READMODES/SERVICESCODEDINQ16b)inthese10transactions?

(INSTRUCTIONTOTHEPROGRAMMER:PROPORTIONSHOULDADDUPTO10ANDSHOWTHESUM)

Q16

a Q16bQ16c Q16d

donein

last3

month

sUsed

branch

banking

UsedAT

Mbanking

Intern

et/

Net

banking

Used

Mobile

Banking

Used

Phone

Banking

Doors

tep/

Home

Ser

vice

Others

Pls

specify

oftenused

mode/

facility

branch

banking

UsedAT

Mbanking

Intern

et/

Net

banking

Used

Mobile

Banking

Phone

Banking

Doors

tep/

Home

Ser

vice

Others

Pls

specify

(R1) Deposityourtelephone/mobilebills,utilitybillslikeelectricitybill 01 01 02 03 04 05 06 99 01 01 02 03 04 05 06 99

(R2) Transfer/depositmoney 02 01 02 03 04 05 06 99 02 01 02 03 04 05 06 99

(R3) Check/Viewaccountbalance 03 01 02 03 04 05 06 99 03 01 02 03 04 05 06 99

(R4) Payinsurancepremium 04 01 02 03 04 05 06 99 04 01 02 03 04 05 06 99

(R5) MonitoringDeposits/Fixed/RecurringDeposits–Short&Longterm 05 01 02 03 04 05 06 99 05 01 02 03 04 05 06 99

(R6) Investinsharemarket 06 01 02 03 04 05 06 99 06 01 02 03 04 05 06 99

(R7) Requestchequebook 07 01 02 03 04 05 06 99 07 01 02 03 04 05 06 99

(R8) ViewLastfewtransactions/MiniStatements 08 01 02 03 04 05 06 99 08 01 02 03 04 05 06 99

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(R9) ViewLoanstatements 09 01 02 03 04 05 06 99 09 01 02 03 04 05 06 99

(R10) ViewCreditCardStatements 10 01 02 03 04 05 06 99 10 01 02 03 04 05 06 99

(R11) InvestinMutualfunds 11 01 02 03 04 05 06 99 11 01 02 03 04 05 06 99

(R12) Stoppaymentoncheques 12 01 02 03 04 05 06 99 12 01 02 03 04 05 06 99

(R13)

Functionalitytostop,changeanddeletepayments/ECSLinkingaccountforAutoDebit

13 01 02 03 04 05 06 99 13 01 02 03 04 05 06 99

(R14)

PINprovision‐ChangeofPIN/Password 14 01 02 03 04 05 06 99 14 01 02 03 04 05 06 99

(R15) PassbookUpdation 15 01 02 03 04 05 06 99 15 01 02 03 04 05 06 99

(R16)

Anyother,pleasespecify____________________ 16 01 02 03 04 05 06 99 16 01 02 03 04 05 06 99

63  

Q17.Atpresent,howoftendoyouvisitthebankphysically?[SA]

Code Route

Daily........................................................................................................................................................... 01 2‐3timesaweek.................................................................................................................................. 02 Onceaweek............................................................................................................................................ 03 Onceafortnight.................................................................................................................................... 04 Onceamonth......................................................................................................................................... 05 Lessthanonceamonth 06

Nevervisitedthebankphysicallyforanyfinancialtransactioninthelastthreemonths 07

Q18.DoanyofyourfamilymembersuseMobileBanking?[MA]

Q19.DoanyofyourfamilymembersuseInternetbankingtransactions?[MA]

M‐banking

Internet

banking

Route

Self(AUTOCODEBASISRESPONSEINQ14a/Q14b)................................ 01 01 Spouse................................................................................................................................. 02 02 Parents................................................................................................................................ 03 03 Siblings 04 04 Grandparents 05 05 Children 06 06 Others 07 07 None 08 08

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Q20

Q21

NowIwillreadoutfewstatementswhichpeoplelikeyouhavementionedasproblemstheyfacewhentheyneedtoreachouttotheirbankphysicallyforanytransaction.AsIreadeachstatement,pleasestateyourlevelofagreementonascaleof1‐5where1meansyoustronglydisagreewhile5meansstronglyagree[SAperstatement]

Amongstalltheproblemsfacedbyyou,rankthetop3problemswhererank1meansthetopmostproblem

Q20 Q21

Problem

Strongly

dis

agree

Disagr

eetosom

eext

ent

Neither

agreenor

disagr

eeAgree

to

some

extent

Strongly

Agree

DK

/CS(If

volun

teer

ed)

Rank

(R1) Iendupwastingalotoftimetravellingtothebank 1 2 3 4 5 9

(R2) Bankbranchesarenotatconvenientlocationsforme 1 2 3 4 5 9

(R3)IamusuallyunabletolocateabankbrancheasilywhenItraveltoadifferentcity

1 2 3 4 5 9

(R4) Ihavetowaitlonginbankqueuesforsomeonetoattendtome 1 2 3 4 5 9

(R5) Serviceprovidedbythebankisnotuptothemark 1 2 3 4 5 9

(R6) VeryoftenInoticethatmybankingtransactionsarenotrecordederror‐free 1 2 3 4 5 9

(R7)Ihavetomovefromonecountertoanotheroneinthebanktogetmyworkdone

1 2 3 4 5 9

(R8) Bankemployees/Frontdeskexecutivesatthebankarenotwillingtohelpcustomers 1 2 3 4 5 9

(R9)Manyatimes,bankemployeesdonothaveadequateknowledgetosatisfymewithmyqueriesandcomplaints

1 2 3 4 5 9

(R10) Mybankdoesn’tprovidepersonal 1 2 3 4 5 9

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attentionorcustomisedservices

(R11) Icannotaccessthebankatallhoursroundtheclockonalldays 1 2 3 4 5 9

(R12) Idonotfindthebankinfrastructuremodernandvisuallyappealing 1 2 3 4 5 9

(R13) Mybankdoesnotofferbetterserviceandfacilitiescomparedtootherbanks 1 2 3 4 5 9

(R14) Mybankdoesnothaveapastrecordofreliabilityandtrustworthiness 1 2 3 4 5 9

(R15) Chequeclearanceincaseofdepositsdonotreflectonthesameday 1 2 3 4 5 9

66  

Section2–UsageofInternetbanking(AdministeredtoalltherespondentswhoareInternetbankingusers,i.e.coded03inQ13b/14bfoanyofhisbankaccountYoumentionedthatyouhavecarriedoutfewfinancialtransactionsusingInternet.NowIwillaskyoufewquestionsrelatedtoyourusageofInternetbanking.

Q1) WhendidyoustartusingInternetBanking?[SA] Code

Inthelast6months......................................................................................................................................... 01 6‐12monthsback........................................................................................................................................... 02 Morethanayearbutlessthan2yearsback........................................................................................ 03 Morethan2yearsback......................................................................................................................