Digital Media Convergence News - Korea
Story courtesy of http://times.hankooki.com/lpage/biz/200601/kt2006013013175911860.htm
Korea Leads World in Mobile Banking
By Kim Tae-gyu - 01-30-2006
Although Korean banks have reduced the number of tellers and local branches, few complaints have been made.
This raises a question: "Where are people making their financial transactions if they are not using bank tellers?"
The answer is via the Internet and cell phones.
According to the Bank of Korea (BOK), Internet banking including trading through mobile handsets overtook bank teller transactions last September.
Twenty major domestic banks saw Internet-based transactions reach 30.9 percent of total financial trading in that month while bank teller transactions accounted for 29.8 percent.
"This is first time that Internet banking nudged past banking with tellers. The gap is expected to further widen in the years to come," BOK official Kim Seong-mooc said.
Financial deals with mobile gadgets averaged roughly 306,000 cases in the third quarter of last year, up 18.8 percent from the previous quarter.
"Banking-on-the-move services are likely to continue to catch on this year thanks to its convenience though there remain headaches like security loopholes," Kim said.
"Korea appears to be in the avant-garde in facilitating new ways of banking thanks to its state-of-the-art infrastructures of the Internet and mobile phones," he added.
Korea boasts the world's greatest penetration rate of high-speed Internet with approximately 12 million out of the nation's total 15.5 million households hooked up to the always-on Internet.
In addition, more than 38 million people out of 48 million carry at least one cell phone.
Go-Anywhere Banking in Korea
Mobile banking is continuing to gain popularity in Korea and the rest of Asia in line with the exploding digital convergence trend.
For example, the number of clients using mobile banking in Korea, based on either integrated-circuit (IC) chips or the portable Internet, amounted to just 1.1 million in Dec. 2002.
However, the figure surged up to 10 folds in two-and-a-half years as more than 10 million customers use mobile banking-enabled handsets.
"Like similar services on the Web, mobile banking is proving to be a slam dunk. It will gain further momentum this year," said Jeon Sang-yong, an analyst at Meritz Securities.
Mobile banking can be defined as a fusion of mobile technology and financial services, which emerged after the advent of the portable Internet and smart-chip-embedded handsets.
The mobility-specific services enable subscribers to access their bank accounts and transfer funds anytime and anywhere via their handheld communication devices.
Despite having been launched only recently (Sept. 2003) mobile banking has already became widespread as trend-sensitive and tech-savvy Koreans resort to the offerings on a regular basis.
"What is the most convenient way to carry out account transactions to push the keys on your cell phone or visit the bank branches in person. The answer is easy,'' Jeon claimed.
In fact, financial services using cell phones were possible even before Sep. 2003 based on the wireless Internet that came much earlier.
Some argue that the wireless application protocol (WAP) provides mobile banking and, in that sense, many nations throughout Asia and the rest of the world already have mobile banking.
However, the early-stage mobile banking could provide the limited range of applications.
By contrast, genuine and full-blown mobile banking empowered by smart IC chips is currently being employed only in Korea and some other mobile juggernauts.
LG Telecom, Korea's smallest operator, stirred things up in Sept. 2003 by kick-starting the chip-based mobile banking through forming a partnership with Kookmin Bank, the nation's biggest lender.
The new chip-based offerings, named "Bank On'' were a big hit and the larger rivals of SK Telecom and KTF soon jumped onto the bandwagon to attract new customers or to hold on to old ones.
Currently, the sky seems to be the limit for the carriers' banking aspiration because the three operators are teaming up with most local banks, respectively.
Global Paradigm Shift of Banking
The paradigm shift from bank tellers to the Internet and cell phone takes place as the mobile phone is increasingly being recognized by banks and the public as a cost-effective way to deliver banking and trading services.
In addition to Korea, mobile banking is expected to expand into many untapped Asian markets, including China, where more than 300 million people own cell phones, but where mobile banking has yet to gain broad consumer acceptance.
The spread of mobile banking will not happen in the short term because the use of IC-outfitted cell phones must be widespread for mobile banking to take root.
Only a few Asian countries presently meet the prerequisite. But in the long term, experts predict the world will follow Korea's footsteps in embracing mobile banking as a way to make transactions.
"At the moment, only Singapore and Japan have the luxury of enabling mobile banking thanks to their leading-edge wireless infrastructure. For other countries, such financial services via handsets are not imminent,'' said Kim Kyung-mo, an economist from Mirae Asset.
But he added the financial services through mobile gadgets are a kind of mega-trend and Asia as a whole will be employing them soon.
"Mobile banking is an unstoppable global convergence trend and Asia will be riding the crest of the wave in the not-so-distant future," Kim expected.
Barriers Ahead
Although banking-on-the-road services clearly have a bright future with exponential growth potential, there remain some barriers such as security concerns and disputes over standards.
Usability, interoperability and security are major considerations in mobile banking. To secure interoperability and enhanced usability, versatile chips, which can interconnect several banks and carriers at a time, are a must.
Currently, one chip can accommodate mobile banking service for just one bank, which means customers are required to exchange chips specific to a certain bank every time they make a transaction.
To rectify this, mobile carriers led by SK Telecom are seeking to invent new types of chips that will include several credit cards and debit cards in a single smart chip.
The operators' commitment to the smart chip, however, aroused the ire of some banks who raised concerns regarding the security of the new solution.
"Banks seem to worry that mobile carriers will gain the upper hand if the smart chips that include customer information of many bankers are introduced by carriers," a Seoul analyst said.
"Banks think that then wireless operators will hold master keys to the smart chips and will exert sweeping clout over them," he added.
Security algorithm disputes and storage space shortages are other headaches to overcome en route to firmly establishing mobile banking.
"As players of the leading mobile banking nation, the two sides must find a win-win solution, putting the benefit of customers first. We should set the trend of the world as far as mobile banking is concerned,'' the analyst concluded.
-----
Lots more articles and reviews like this are at http://www.ipods-and-onlinevideo-reviews.com.
Chip Tarver
Korea Leads World in Mobile Banking
By Kim Tae-gyu - 01-30-2006
Although Korean banks have reduced the number of tellers and local branches, few complaints have been made.
This raises a question: "Where are people making their financial transactions if they are not using bank tellers?"
The answer is via the Internet and cell phones.
According to the Bank of Korea (BOK), Internet banking including trading through mobile handsets overtook bank teller transactions last September.
Twenty major domestic banks saw Internet-based transactions reach 30.9 percent of total financial trading in that month while bank teller transactions accounted for 29.8 percent.
"This is first time that Internet banking nudged past banking with tellers. The gap is expected to further widen in the years to come," BOK official Kim Seong-mooc said.
Financial deals with mobile gadgets averaged roughly 306,000 cases in the third quarter of last year, up 18.8 percent from the previous quarter.
"Banking-on-the-move services are likely to continue to catch on this year thanks to its convenience though there remain headaches like security loopholes," Kim said.
"Korea appears to be in the avant-garde in facilitating new ways of banking thanks to its state-of-the-art infrastructures of the Internet and mobile phones," he added.
Korea boasts the world's greatest penetration rate of high-speed Internet with approximately 12 million out of the nation's total 15.5 million households hooked up to the always-on Internet.
In addition, more than 38 million people out of 48 million carry at least one cell phone.
Go-Anywhere Banking in Korea
Mobile banking is continuing to gain popularity in Korea and the rest of Asia in line with the exploding digital convergence trend.
For example, the number of clients using mobile banking in Korea, based on either integrated-circuit (IC) chips or the portable Internet, amounted to just 1.1 million in Dec. 2002.
However, the figure surged up to 10 folds in two-and-a-half years as more than 10 million customers use mobile banking-enabled handsets.
"Like similar services on the Web, mobile banking is proving to be a slam dunk. It will gain further momentum this year," said Jeon Sang-yong, an analyst at Meritz Securities.
Mobile banking can be defined as a fusion of mobile technology and financial services, which emerged after the advent of the portable Internet and smart-chip-embedded handsets.
The mobility-specific services enable subscribers to access their bank accounts and transfer funds anytime and anywhere via their handheld communication devices.
Despite having been launched only recently (Sept. 2003) mobile banking has already became widespread as trend-sensitive and tech-savvy Koreans resort to the offerings on a regular basis.
"What is the most convenient way to carry out account transactions to push the keys on your cell phone or visit the bank branches in person. The answer is easy,'' Jeon claimed.
In fact, financial services using cell phones were possible even before Sep. 2003 based on the wireless Internet that came much earlier.
Some argue that the wireless application protocol (WAP) provides mobile banking and, in that sense, many nations throughout Asia and the rest of the world already have mobile banking.
However, the early-stage mobile banking could provide the limited range of applications.
By contrast, genuine and full-blown mobile banking empowered by smart IC chips is currently being employed only in Korea and some other mobile juggernauts.
LG Telecom, Korea's smallest operator, stirred things up in Sept. 2003 by kick-starting the chip-based mobile banking through forming a partnership with Kookmin Bank, the nation's biggest lender.
The new chip-based offerings, named "Bank On'' were a big hit and the larger rivals of SK Telecom and KTF soon jumped onto the bandwagon to attract new customers or to hold on to old ones.
Currently, the sky seems to be the limit for the carriers' banking aspiration because the three operators are teaming up with most local banks, respectively.
Global Paradigm Shift of Banking
The paradigm shift from bank tellers to the Internet and cell phone takes place as the mobile phone is increasingly being recognized by banks and the public as a cost-effective way to deliver banking and trading services.
In addition to Korea, mobile banking is expected to expand into many untapped Asian markets, including China, where more than 300 million people own cell phones, but where mobile banking has yet to gain broad consumer acceptance.
The spread of mobile banking will not happen in the short term because the use of IC-outfitted cell phones must be widespread for mobile banking to take root.
Only a few Asian countries presently meet the prerequisite. But in the long term, experts predict the world will follow Korea's footsteps in embracing mobile banking as a way to make transactions.
"At the moment, only Singapore and Japan have the luxury of enabling mobile banking thanks to their leading-edge wireless infrastructure. For other countries, such financial services via handsets are not imminent,'' said Kim Kyung-mo, an economist from Mirae Asset.
But he added the financial services through mobile gadgets are a kind of mega-trend and Asia as a whole will be employing them soon.
"Mobile banking is an unstoppable global convergence trend and Asia will be riding the crest of the wave in the not-so-distant future," Kim expected.
Barriers Ahead
Although banking-on-the-road services clearly have a bright future with exponential growth potential, there remain some barriers such as security concerns and disputes over standards.
Usability, interoperability and security are major considerations in mobile banking. To secure interoperability and enhanced usability, versatile chips, which can interconnect several banks and carriers at a time, are a must.
Currently, one chip can accommodate mobile banking service for just one bank, which means customers are required to exchange chips specific to a certain bank every time they make a transaction.
To rectify this, mobile carriers led by SK Telecom are seeking to invent new types of chips that will include several credit cards and debit cards in a single smart chip.
The operators' commitment to the smart chip, however, aroused the ire of some banks who raised concerns regarding the security of the new solution.
"Banks seem to worry that mobile carriers will gain the upper hand if the smart chips that include customer information of many bankers are introduced by carriers," a Seoul analyst said.
"Banks think that then wireless operators will hold master keys to the smart chips and will exert sweeping clout over them," he added.
Security algorithm disputes and storage space shortages are other headaches to overcome en route to firmly establishing mobile banking.
"As players of the leading mobile banking nation, the two sides must find a win-win solution, putting the benefit of customers first. We should set the trend of the world as far as mobile banking is concerned,'' the analyst concluded.
-----
Lots more articles and reviews like this are at http://www.ipods-and-onlinevideo-reviews.com.
Chip Tarver
posted by Chip Tarver at
1:17 PM
