Hal-Cash is one of the new breed of retail financial
services innovations from around the world that look to exploit
mobile phones and mobile devices. Based in Spain, Hal-Cash lets
people withdraw cash from ATMs using SMS text messages.
Rodrigo Amaral talks to the
company’s CEO, Joaquín Beltrán Nuñez, in Madrid
A Spanish company has developed an ambitious system that enables
mobile phone users to go to an ATM and make a withdrawal without
the need for a card.
Go deeper with GlobalData
Hal-Cash aims to provide banks with a range of
services for their retail banking customers and also the tools to
make inroads into the money transfer business. The system is
already being used by 11 banks in Spain and has started to spread
to other countries in Europe.
Hal-Cash is a Madrid-based firm owned by six
major domestic banks: Bankinter, Banco Popular, Caixa Galicia,
Bancaja, Cajamar and Banesto.
It was set up at the end of 2007 by its
banking partners to help increase innovation – and revenues – by
investing in technology. The company employs a mere seven people in
the heart of the Spanish capital.
Innovation and
integration
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By GlobalData“The idea took shape amid
discussions within the banking industry about innovation and the
integration of communication channels,” CEO Joaquín Beltrán Nuñez
told RBI.
“We realised at the time that there wasn’t any
way to cash money from an ATM apart from using a card. Our system
enables people to cash money from an ATM without a card and even
without being a client of the bank.”
The scheme, so far, is for the exclusive use
of the customers of its partner banks as well as four other
financial services institutions including the Spanish subsidiary of
ING Direct.
If a bank’s customer makes an electronic
transfer order to a third party, the channel by which the client
makes the order can vary depending on each bank.
The options available so far are the internet,
bank branches, mobile phones or ATMs, according to Beltrán.
Among the information provided by the client
is the mobile phone of the beneficiary, who does not need to be a
client of any of the banks involved in the scheme.
The bank gives an order to make the electronic
money transfer via the Hal-Cash system. Hal-Cash processes the
request in a ‘safe’ server, automatically generates a unique PIN
number and sends it to the mobile phone of the beneficiary.
The money can be cashed out in an ATM
belonging to any of the banks that participate in the scheme by
using the unique PIN number.
“You see ever more initiatives to enable
people to make payments via mobile phone, but Hal-Cash is a
different concept,” Beltrán said. “It is a payment that arrives to
the beneficiary via mobile phone.”
In the two years since the system has been in
operation, over 250,000 cash withdrawals, totalling €40 million
($60 million), have been made a year in Spain using a mobile phone
via Hal-Cash, according to Beltrán, who is also the head of
innovation at Bankinter.
The transactions involve as much money as
allowed by the country's banking legislation for
electronic transfers: in Spain, between €10 and €600.
Worldwide network
The goal of the company is to create
a worldwide network of banks linked via Hal-Cash in order to
facilitate cash withdrawals via mobile phones.
The firm has registered copyright in 40
countries, and signed agreements with banks in France, Italy,
Poland, the Ukraine, the Philippines, India, the US, Bolivia,
Mexico, Argentina, Ecuador and Morocco. In the latter two, the
system is already in operation via Banco de Guayaquil and Crédit du
Maroc (a Crédit Agricole subsidiary), respectively.
Global expansion is a major goal for the
company as it believes that Hal-Cash can provide competition to
money transfer companies thanks to the low costs involved and the
easy availability of the system, as transactions can be performed
24 hours a day.
If an Ecuadorian or Moroccan immigrant in
Spain wants to send a remittance to her family back at home, under
the Hal-Cash programme, she is charged €1 for a transfer of up to
€600.
“We are looking for partners in the UK, which
has a big immigrant population who could take advantage of the
system,” said Beltrán. “But hitherto we haven't signed any
agreements with British banks.”
In addition to remittances, Hal-Cash can also
prove useful for individuals who happen to leave home without their
cards or those with an invalid one. But corporate clients have also
been using the system, Beltrán noted.
They can send money immediately to their staff
to pay for travel or other expenses, or in emergency situations.
Companies have also taken advantage of the system to launch
promotional campaigns, luring consumers with the possibility of
winning instantly available cash rewards.
One recent campaign, run by a large Spanish
bakery chain called Panrico, involved an SMS code hidden under a
scratch-off surface on plates served to customers that could be
sent to a pre-determined number to claim a prize. Other firms that
have launched similar initiatives with Hal-Cash include Coca-Cola
and Nestlé.
Beltrán said: “For banks, it is an interesting
opportunity, as companies put the prize money in their bank
accounts to do the campaign and charge a fee every time a reward is
cashed out at an ATM.”
