SMS – the driving force behind mobile banking services

Mobile phones have fundamentally changed the way we communicate with one another and the days when phones were used for their original purpose, i.e. talking, are long gone. Why call someone when you can use Facebook or text?

Nowhere are our changing habits more apparent than in the way we manage money. We bank online, we receive updates via text and as Smartphone technology continues to prevail, it won’t be that long before we do away with our bank cards altogether, as our phones become the equivalent of chip and pin machines.

Mobile technology is revolutionizing the African continent, where more than half of its 1 billion population owns a mobile phone. These devices are not just for talking, they are fostering an entrepreneurial culture, they are improving quality of life and to a large extent, SMS is the reason

The best example of this is in mobile banking. Four years ago, Safaricom (a Kenyan operator) introduced M-Pesa, a service that allows people to store money on their mobiles. If they want to pay a utility bill or send money to family or friends, they simply confirm the amount by SMS and
the recipient converts the text message into cash at their local M-Pesa office. This mobile banking service has since spread into other African countries because it’s cheap, it’s easy to use and it provides a lifeline to the millions of Africans who do not have or cannot afford a conventional bank account.

Closer to home, even the most sophisticated banking apps used by high flyers in the City rely on SMS as a secondary means of communication, as the recently launched Co-operative banking app demonstrates.

Their new app allows Smartphone users to check their bank balances, access mini statements and locate the nearest cash points. For account holders that do not have a Smartphone, or if coverage is weak, they can opt to receive this information via SMS.

The above two applications demonstrate the importance of SMS in the banking world, even in our Smartphone age and the reasons for this are as follows:

  • Universal –all phones (including landlines) support SMS and there are no network or latency-related issues
  • Speed – messages are delivered as soon as they are sent
  • Economical – banks can negotiate highly competitive rates for bulk SMS
  • Wide marketing reach – SMS is understood by everyone
  • Easy response mechanism – SMS provides users with an easy response mechanism at the push of a button
  • Accessibility – SMS is not dependent on 3G coverage

We have been involved in online SMS services for more than five years. We specialise in developing bespoke applications to meet niche requirements. Our software integrates seamlessly with third party technologies via a developers API and unlike our competitors, we offer personalised SMS facilities as standard.

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