Andrew Dark, CEO of mBlox, comments on
how secure text messaging will prove
to be the backbone of the mobile money
revolution

2011 has been heralded as the year that will usher in the widespread adoption of mobile payments. Mobile connected devices have already significantly changed the way consumers pay for goods and services, with ABI Research recently claiming that worldwide consumer m-commerce spending will reach $119 billion in the next five years.

Lucrative market
As we hit the mid-year mark we have already seen announcements from industry leaders such as Vodafone, O2, Orange and Google, each staking a claim in what promises to be a lucrative market.

With such established brands getting involved, it may soon be the norm that the majority of consumers will pay for goods and services via their mobile devices. Text messaging will prove fundamental to encouraging not just the uptake of mobile commerce options, but also to ensuring that consumers have full faith in the solution’s security.

The traditional 160 character text message has rapidly become mainstream following the first message, ‘Merry Christmas’, which was sent across the Vodafone network in December 1992.

The popularity of text messaging is such that ABI Research expects as many as seven trillion to be sent this year alone. Its ease of use and ubiquitous nature mean that it is the perfect medium for all consumers – not just the minority of smartphone owners – to start using m-commerce solutions and services. It has already been widely adopted by financial institutions to provide real time information on services including balance details, overdraft information and fraud alerts.

Financial services strong arm
Financial services have a proven record in leading the charge when maximising technology to better communicate with their customers, and text messaging is no different. Under constant pressure to better compete against peers in a market where speed of reaction of often of the essence, text messaging services allow banks and financial services providers to create instant, two-way communications with customers. This means that customers will be much more likely to speak to their service provider in the event of a problem, as well as allowing banks to further embed themselves with the customer, educating them about new services and offers and, ultimately, moving beyond the traditional service provider role to maximise profits.

Text-based services empower the customer to engage with the consumer more efficiently, offering self service options that allow users to have a smoother experience with their personal banking and in managing their money.

However, to ensure take up, demonstrable security measures have to be seen to come as standard. Innovative solutions for secure two-way communication are already being introduced, with the first truly secure text services already available at no extra cost to the consumer.

No prying eyes here!
Because mobile commerce depends on the transfer of confidential and valuable data, assuring that prying eyes will not be able to access personal and confidential details will be fundamental to its success, whether from financial services, mobile ticketing or retail point of view.

We have already witnessed the fact that consumers are increasingly willing to use mobile commerce; numbers of transactions are increasing and both the Haiti and Japan disasters saw consumers willing to donate via text messaging services.

A decade ago the industry saw Coca-Cola roll out dispensing machines across Finland that could accept payments via text message, yet m-commerce today is still at an early development stage. The mobile industry has learned the lessons of early web commerce and should therefore, avoid falling victim to similar security scares that plagued early online activity.

Any organisation looking to maximise the opportunity needs to reassure consumers regarding the encryption of personal information and content such as high value coupons or sales vouchers, PIN numbers, virtual credit and debit cards, and purchase data. Only by doing so will they encourage uptake of potentially lucrative revenue streams and drive even greater interaction with the customer using the mobile device.