INTRODUCTION TO TOPIC:-

HISTORY OF BANK: -

Modern banking in India originated in the mid of 18th century. Among the first
banks were the Bank of Hindustan, which was established in 1770 and
liquidated in 1829–32; and the General Bank of India, established in 1786 but
failed in 1791.

The largest and the oldest bank which is still in existence is the State Bank of
India (SBI). It originated and started working as the Bank of Calcutta in mid-
June 1806. In 1809, it was renamed as the Bank of Bengal. This was one of the
three banks founded by a presidency government, the other two were the
Bank of Bombay in 1840 and the Bank of Madras in 1843. The three banks
were merged in 1921 to form the Imperial Bank of India, which upon India's
independence, became the State Bank of India in 1955. For many years, the
presidency banks had acted as quasi-central banks, as did their successors,
until the Reserve Bank of India was established in 1935, under the Reserve
Bank of India Act, 1934.

Definition of Mobile Banking:

Mobile banking is defined as:

"Mobile Banking refers to provision and availment of banking- and

financial services with the help of mobile telecommunication devices. The
scope of offered services may include facilities to conduct bank and stock
market transactions, to administer accounts and to access Customised
information."

INTRODUCTION TO MOBILE BANKING: -

 Mobile banking is a service provided by a bank or other financial institution
that allows its customers to conduct financial transactions remotely using a
mobile device such as a smartphone or tablet. Unlike the related internet
banking it uses software, usually called an app, provided by the financial
institution for the purpose. Mobile banking is usually available on a 24-hour
basis. Some financial institutions have restrictions on which accounts may be
accessed through mobile banking, as well as a limit on the amount that can be
transacted. Mobile banking is dependent on the availability of an internet or
data connection to the mobile device.

Transactions through mobile banking depend on the features of the

mobile banking app provided and typically includes obtaining account balances
and lists of latest transactions, electronic bill payments, remote check deposits,
P2P payments, and funds transfers between a customer's or another's
accounts. Some apps also enable copies of statements to be downloaded and
sometimes printed at the customer's premises.

From the bank's point of view, mobile banking reduces the cost of
handling transactions by reducing the need for customers to visit a bank
branch for non-cash withdrawal and deposit transactions. Mobile banking does
not handle transactions involving cash, and a customer needs to visit an ATM
or bank branch for cash withdrawals or deposits. Many apps now have a
remote deposit option; using the device's camera to digitally transmit cheques
to their financial institution.

Mobile banking differs from mobile payments, which involves the use
of a mobile device to pay for goods or services either at the point of sale or
remotely,[2] analogously to the use of a debit or credit card to effect an EFTPOS
payment.
 MOBILE BANKING (also known as M- banking, SMS banking etc.)
is a term used for performing balance checks, account transactions, payments
etc. via a mobile device such as a mobile phone. Mobile banking today is
most often performed via SMS or the Mobile Internet but can also use special
programs called clients downloaded to the mobile device. Mobile banking is a
way for the customer to perform banking actions on his or her cell phone or
other mobile device. It is also known as M-Banking or SMS Banking.

Mobile banking allows the user to log into his or her account from a cell
phone, and then use the phone to make payments, check balances, transfer
money between accounts, notify the bank of a lost or stolen credit card, stop
payment on a check, receive a new PIN, or view a monthly statement, among
other transactions. This type of banking is meant to be more convenient for the
consumer than having to physically go into a bank, log on from their home
computer, or make a phone call. While all of this is true, some are concerned
about the security of mobile banking.
 The earliest mobile banking services used SMS, a service known as
SMS banking. With the introduction of smart phones with WAP support
enabling the use of the mobile web in 1999, the first European banks started to
offer mobile banking on this platform to their customers.

Mobile banking before 2010 was most often performed via SMS or the
mobile web. Apple's initial success with iPhone and the rapid growth of phones
based on Google's Android (operating system) have led to increasing use of
special mobile apps, downloaded to the mobile device. With that said,
advancements in web technologies such as HTML5, CSS3 and JavaScript have
seen more banks launching mobile web based services to complement native
applications. These applications are consisted of a web application module in
JSP such as J2EE and functions of another module J2ME.

A recent study (May 2012) by Mapa Research suggests that over a

third of banks have mobile device detection upon visiting the banks' main
website. A number of things can happen on mobile detection such as redirecting
to an app store, redirection to a mobile banking specific website or providing a
menu of mobile banking options for the user to choose from. In country only
banking sector is that sector which works as a channel in attracting savings and
mobilizing them in required areas. It works as a weapon of capital formation.

As, change is the rule of nature . To alter the policies according to enviournment
fluctuation is known as change and to explore or use new technology for
making change is known as innovation. Today all sectors are working as
innovation acceptor.

Banking sector’s profitability depends on better customer relationship.

And nowadays today’s consumer banking needs are getting more complex and
demands are for more innovative products. So give them better services banks
have introduced a new profitable technology called MOBILE BANKING. And
many more like internet banking, ATM, debit card, credit card etc.

With mobile banking technology, banks can offer a wide range of services to
their customer such as funds transfer while travelling, receiving online updates
of stock price or even performing trading while being stuck in traffic.

M-banking gives ability to customer to control their cash outflows

anytime, anywhere, without having to connect to internet The use of a mobile
phone to make payment and carryout other banking transaction called m-
banking has started taking roots in a number of developing countries, including
India.

M-banking is a service of banks to make available, the facility of

banking wherever the customer is and whenever he needs. In today’s world
every person has personal mobile rather than having computer at home. Even
rural person also have mobile.
CLASSIFICATION OF BANKING INDUSTRY IN INDIA

BANKING SERVICE:

In modern times there are many services that are offered by the banks. This is
done so that more and more customers are attracted. Although there are some
basic services as well which are offered by the banks. Thus, these basic services
are common for all banks. In this article, we will help you understand some of the
services of banks which are common across all the banks in India.In addition
many more like internetbanking, ATM, debit card, credit card etc.It work as

a weapon of capital formation.

Banking sector’s profitability depends on better customer relationship. Moreover,
nowadays today’s consumer banking needs are getting more complex and
demand are for more innovative product. Therefore, give them better service
bank have introduce a new profitable technology called MOBILE BANKING.
CONCEPT OF MOBILE BANKING:

Mobile banking is a service provided by a bank or other financial institution

that allows its customers to conduct financial transactions remotely using
a mobile device such as a smartphone or tablet. Unlike the related INTERNET
BANKING it uses software, usually called an app, provided by the financial
institution for the purpose. Mobile banking is usually available on a 24-hour
basis. Some financial institutions have restrictions on which accounts may be
accessed through mobile banking, as well as a limit on the amount that can be
transacted. Mobile banking is dependent on the availability of an internet or
data connection to the mobile device.
According to the mobile banking service, it can divide into two parts :
First one, SMS banking SMS banking refer to provide the account information
through the SMS whenever you transaction from the account .
Second one, is application based banking this is refers to provide the banking
facility via mobile with the help of mobile application this facilities are
available in smart phone by downloading application of banking service we can
use it. Mobile banking is a facility that enables customers to initiate and/or
perform banking tasks on their mobile phones. This is provided by most of the
banks in India and abroad. Customers can use mobile banking to view their
account balance, make instant fund transfers and pay bills, etc.
TYPES OF MOBILE BANKING IN INDIA:

Banks provide mobile banking services to their clients in the ways listed here:

. Mobile banking over Wireless Application Protocol. (WAP)

. Mobile banking over SMS. (Also known as SMS banking)
. Mobile banking over Unstructured Supplementary Service Data. (USSD)

Mobile Banking over WAP:

In an effort to provide their customers with transact digitally, the bank has also
introduced WAP (wireless application protocol) based mobile banking service
wherein the customer can access the bank's website using the browser on
their mobile phone. to know more about the services offered under WAP-
based mobile banking.

Mobile Banking over SMS:

 It is a facility used by some banks or other financial institutions to send

messages (also called notifications or alerts) to customers' mobile phones
using SMS messaging, or a service provided by them which enables customers
to perform some financial transactions using SMS.
Mobile Banking over USSD:

USSD is a technology platform through which information can be transmitted through a

GSM network on a basic phone. ... To use USSD mobile banking, users will have to simply
dial *99# and use the interactive menu. There are many banks in India that are currently
providing the *99# service.

Types of Mobile Banking Services

Mobile banking services can be categorized into the following:

 1. Account information access

Account information access allows clients to view their account balances and
statements by requesting a mini account statement, review transactional and
account history, keep track of their term deposits, review and view loan or card
statements, access investment statements (equity or mutual funds. A mutual fund is a
pool of money collected from many investors for the purpose of investing in
stocks, bonds, or other securities. Mutual funds are owned by a group of investors
and managed by professionals. Learn about the various types of fund, how they
work, and benefits and tradeoffs of investing in them), and for some institutions,
management of insurance policies.

 2. Transactions

Transactional services enable clients to transfer funds to accounts at the same

institution or other institutions, perform self-account transfers, pay third parties
(such as bill payments), and make purchases in collaboration with other
applications or prepaid service providers.

 3. Investments

Investment management services enable clients to manage their portfolios or get a

real-time view of their investment portfolios (term-deposits, etc.)

 4. Support services

Support services enable clients to check on the status of their requests for loan or
credit facilities, follow up on their card requests, and locate ATMs.
ADVANTAGES AND DISADVANTAGES OF MOBILE BANKING:

Mobile banking provides the following advantages :

a) Always on 24 x 7 Accesses : Banks are able to provide services to

the customers for 24 hours per day and 7 days per week. It enables
the consumers to be transaction-ready much as cable access has
facilitated online PC access and reduced consumer dialup delays.

b) Advanced Penetration of Mobile Networks : The 2G networks

already cover more than 90% of the population in the western world
and this number is growing steadily.

c) Personalisation : Through Subscriber Identify Module (SIM) cards,

mobile customers have a specific profile that enables
customised functionality to directly reflect the way they want to
transact business over mobile devices. Through the convenient
addition of a multi-application, relationship card, mobile customers
will also have a built-in platform for a host of other application
services, including security keys, virtual credit cards and other
customised payment instruments.

d) WAP: Rapid evolution of global protocols such as Wireless

Application Protocol (WAP) enables the communication channel
between computers and mobile devices. The WAP component
essentially provides the facility of reforming data for display in wireless
handsets.

e) Faster Data Processing Speed: Increase in bandwidth and data

transmission speeds makes mobile data services efficient and cost-
effective in a real time environment.

f) Security: In addition to the above mentioned smart card, a private

key stored on the SIM card can protect e-banking transactions.
Effectively, the mobile phone can become a wireless wallet to protect
proprietary purchase and financial information.

g) Mobile Payment : Mobile payment means executing a payment

transaction using a wireless device such as mobile phone or
personal digital assistant. The mobile device becomes the electronic
payments device. Its mobility is its big advantage.

Mobile banking provides the following disadvantages:-

a) Restricted Plans : Though there were many plans to enhance

mobile banking offerings and services, in reality the initiatives were
very restricted. Most applications are informative such as bank
balances or credit card or bank amounts rather than interactive
services like buying or trading

b) Technical Problems : There are problems of technical issues,

security concerns and cost constraints. WAP proved to be too slow
and cumbersome to satisfy the customer. People think about security.
But, their concerns are not adequately fulfilled by purveyors of m-
banking.

c) High Charges : The most significant problem of m-banking is that

costs exceed perceived benefits. The charges for data transmitted are
still too high to develop mobile banking in several countries.

d) Negative Experience in European Countries : Experience about

m-banking in European countries has not been positive. e.g. the
British leader in on-line banking decided to abort its mobile offering.
It saw little enthusiasm for mobile banking among its customers.