Cost, not security, the problem with m-banking

Security is not the main concern in mobile banking. The real issue is making m-banking viable as a business concern, in order to offer it to the unbanked.

This is according to Thabiso Moerane, Mobile Commerce Ecosystem Leader at Alcatel-Lucent, who will address the ITWeb Security Summit, taking place from 15-17 May at the Sandton Convention Centre.

Moerane says fears about the security of mobile banking are probably “more psychological than anything else”. While she concedes that nothing can be said to be 100% secure, mobile banking, depending on the bearer channel, is just as secure as using a laptop, Internet banking and an ATM, and possibly more secure than using a credit card in a public place, she says.

Does she conduct her own banking via mobile? “I certainly do. I've used Internet banking since it became available, and I am very comfortable with using mobile banking too,” she says.

However, the problem with m-banking is making it commercially viable for banks and operators to roll it out to the vast numbers of unbanked and under-banked in South Africa. Currently, it is not. “It has been found that the average lower-LSM person can only afford to spend R15 a month on banking services,” says Moerane. With 15 million South Africans unbanked, and 9 million under-banked (ie, they have an account, but only conduct two to three transactions a month), there is clearly an urgent need to provide services to them in a way that is viable for those who offer it.

“Mobile banking makes the most sense because the mobile infrastructure is available across the country,” she says. “What comes into play now is finding ways to achieve a business model that makes commercial sense and is still affordable enough for low-income customers.” The good news, she says, it that SA is close to achieving this now.

“The key to making this work is to find a way to lower the cost of providing the service - and this means reducing the cost of the entire ecosystem. It requires collaboration between various partners in the ecosystem, which is difficult to do, but it is achievable,” she says.

The forthcoming ITWeb Security Summit in May is tailored to address the current IT security concerns of SA's CISOs and strategic decision-makers. The 2012 summit features two days of informative sessions presented by leading international and local security experts, and a full day of interactive workshops. Delegates will be able to assess and compare new tools and services within the IT security space at the Security Summit exhibition. Equip yourself with the latest IT solutions, and benefit from commentary on new trends and threats, which may inform your security strategy. For more information, visit www.securitysummit.co.za.