Tuesday, August 04, 2009

Will smartcards out-smart mobile banking in India?

India recently announced an ambitious plan to deploy a national biometric smartcard to everybody in the country. (Read here). Seen as the biggest IT project ever attempted, this project aims to provide every-one in the country with a digital identity, while connecting many other services to this central system. The good guys at CGAP make the point that it would actually be easy to provide rudimentary banking services on this card. (Read here).

A national smart card with a cheap mechanism to store money electronically would have a major impact on the fledgling mobile banking industry in India. The impact on business plans, payment switches and distribution strategies would be huge. While the jury is still out if it would be possible at all to deploy this system effectively, it is important for mobile banking operators and vendors in India to consider this implication and to develop complimentary strategies.

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