In the complex and fast
evolving ecosystem of mobile payments, it can be hard for
vendors to differentiate themselves from the abundant number of
competitors vying to get a slice of the market’s lucrative
potential.

From a bank’s perspective, the biggest
challenges are, on the one hand, meeting customer requirements
and, on the other hand, figuring out whether to build relevant
software in-house or turn to a vendor to capture
customer satisfaction when demands and attitudes are still
evolving.

In the case of the latter option, another
challenge banks face is finding the right vendor.

The Global Bank Technology Trends
2011 report by Aite Group found that two in five banks decide
whether to build software in-house or not on an ad-hoc basis.

Key findings included:

46 percent prefer buying banking technology software from
vendors – while less than a fifth (16 percent) prefer building it
in-house;
28 percent of banks deploy software from vendors for m-banking,
but
39 percent of consumers are “not satisfied” with the m-banking
service.

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m-banking vital for customer satisfaction

Considering that global smart phone adoption is forecast to grow
to 977 million users worldwide by 2013, m-banking is a vital
channel for banks to enhance propositions.

Fine-tune the focus on the Middle East, where
a
quarter of all retail banking customers in the Gulf Cooperation
Council are planning to switch their bank accounts in 2011
(Ernst & Young:Retail Banking in the GCC: Competing for
Customers) – and finding the right vendor is crucial.

Tellcos are key

According to Marco Casartelli, CEO and
co-founder of Vipera, a provider of mobile financial services
platforms with significant contracts in the Middle East,
telecommunications (telcos) network providers and phone
manufacturers will be key partners for banks.

He told RBI that the transactional
aspect of mobile banking had not taken off despite the extensive
penetration of mobile phones in consumers’ lives “because of the
lack of value propositions.”

“Mobile banking has to be convenient for
consumers. Consumers are still on the learning curve. Online
banking is a reality, but when security is guaranteed and consumers
try mobile banking, they prefer it.”

Using
Turkey as an example – a target market for Vipera in 2011 – he
said that despite
a stable banking technology, the huge unbanked population could
easily be brought into the banking system via telcos’s wide
distribution network.

No need for cards?

“What is the purpose of building a cards
infrastructure if you can go straight into m-payments? There is no
point in having an ecosystem that costs a lot to manage. It can be
easily replaced with technology such as NFC.”

“But payment services are not in telcos’s DNA
– they are a bearer.”

He said that Vipera’s model – available as a
software licence or managed service – could thus help banks bridge
their services with that of telcos’ to distribute multi-channel
solutions, including wallet functionality.

According to Casartelli, Vipera’s
cross-carrier, cross-platform solution has the flexibility to be
personalised according to a client’s needs and requirements “in a
convenient time frame”.

Mashreq: from contract signing to full m-banking service
in 3 months

The vendor has m-banking contracts with
Maybank Malaysia, Qatar National Bank, First Gulf Bank and Mashreq
and is now targeting greater exposure in Europe.

In the case of Mashreq Bank in the UAE, it
took Vipera three months “from signing the contract to going live
with a full fledged mobile banking solution.”

The service, available in English and Arabic
to six million users, can be access via any mobile device and
offers balance checks, bill and credit card payments and
remittances.

Douglas Beckett, head of retail banking at
Mashreq, said: “Mobile banking is emerging as a key service for
consumers who expect their bank to be available to them anytime,
anywhere, globally.”

Vipera’s deals with banks in 2010
included:

A multi-year contract in co-operation with Mannai Corporation
to develop and operate mobile banking and payment solutions for
Qatar National Bank;
A distribution agreement with Thailand-based consulting and IT
services company T.N. Information Systems for services in the
country’s banking and government market, and
Additional services to its existing contract with Mashreq
Bank.