Mobile banking and Digital Currency – Confluence of Consequence


In continuation of our
earlier blog, we analyse the confluence of mobile banking and digital currency in this piece.

Bill Gates in his 2015 annual letter talks about Digital Banking being one of the most important disruptions of the 21st century. Already with developing countries, mobile phones are becoming banks – people are storing, transacting digitally through mobiles.  By 2030, he points out that about 2 billion people will be storing money and making payment through phones.  It is indeed inevitable that mobile banking is the key channel for payments and other commercial transactions.  

A survey was conducted by ING indicated that mobile banking was on the rise.  The study shows mobile banking and transactions are on the whole increasing and the countries with the highest adoption of mobile banking and payments also tend to have the highest percentage of people who had used and believe in Bitcoin. While more than 60% of the sample indicated use of mobile, less than 10% actually used digital currency.

This brings about the fact that there is a clear opportunity for ‘mobile-fication’ of the digital currency.  We already have seen that digital currency is an inevitable mode of transactions in the digital economy.   By the time the digital currency platform becomes more popular mobile will become a near ubiquitous channel.  What is key here is that, certain payment vendors have already realized the importance of this sequence – mobile first, digital currency follows.   

Amazon payments has realized its digital currency in both in its native store and android last year beyond its Kindle Firestore. This currency enables users to buy spend and earn on Android tablets and phones in the US, UK and Germany. Amazon sells them in bunches like 500 for $5. You can use this currency like Livepoints in Microsoft Xbox, essentially a gamified use of the virtual currency.  Once the transaction proves successful, it is a matter of time it is used in the e-commerce world.  

As more mobile apps allow use of digital currency across app stores, it is imperative the traditional method of real currency transactions in the mobile world will disappear.  However, virtual currencies are still not understood by the unsuspecting public, and it is known that mobile applications are the most vulnerable lot.  We will analyse how this vulnerability will affect digital currency transactions on mobile platforms.

 

References:

http://www.gatesnotes.com/2015-annual-letter?page=5&lang=en

https://bitcoinmagazine.com/articles/5-revelations-bitcoin-ing-2015-mobile-banking-survey-1429820988

http://www.paymentscardsandmobile.com/amazons-digital-currency-coin-now-available-android/