Cell Phones and a Cashless Society

Cash usage is declining around the world, but only very slowly. It is still representing almost 80% of all payments flows, but this is set to change as new forms of electronic payment service emerge. Meanwhile, cheques and other forms of paper payments have almost been eradicated. These payment instruments are being replaced by debit and credit cards and e-invoicing. However, even the ever popular credit card can now be replaced by the… mobile device. Obviously, a payments revolution is taking place! - Mobile Payments World Asia 2008, September 10–11, 2008

DOJ: Cell Phones Don't Have Privacy Rights

February 13, 2010

CNet - The Justice Department went to court last week in a dispute over mobile devices that may become a major constitutional test for 21st century technology. The government told the U.S. Third Circuit Court of Appeals that the users of handheld and mobile devices don't have a constitutional right to privacy. Lawyers argued that cops should be able to acquire "routine business records" held by a "communications service provider."

It is the first federal appeals court to consider warrantless location tracking, which raises the question about whether Americans have a reasonable expectation of privacy for their cell phones' location. It is a case likely to wind up at the U.S. Supreme Court after the appeals court hands down its decision.

The Obama administration argues that no search warrant is needed. A law enforcement agency just needs to show that the records are "relevant and material to an ongoing criminal investigation." But civil liberties groups oppose that idea.

"When the government acquires historical cell location information, it effectively commandeers our cell phones and turns them into electronic trackers that report, without our knowledge or consent, where we have been and how long we have been there," Susan Freiwald, a law professor at the University of San Francisco argued to the appeals court. "We should be able to use our cell phones without them creating a virtual map of our every movement and association."

Freiwald says civil liberties groups aren't opposed to the government obtaining the information for legitimate purposes--as long as federal privacy laws are followed. However, she says:

This is "a truly novel technology that can invade the privacy of all Americans who carry cell phones in their pockets or purses."

Global Mobile Phone Banking Seen to Reach $202 Billion in 2012

December 15, 2009

The Philippine Star - The magnitude of global mobile banking is forecast to hit $202 billion by 2012, and 60 percent of that will emanate from the Asia Pacific region.

Foreign consulting firm Edgar Dunn & Co. added that the Philippines, China, and India would be leading the way in the Asia Pacific region.

Lance Blockely, managing director of Edgar Dunn & Co. said that the Philippines is the global leader in mobile money transfer (MMT) and “the next few years will be a climate of explosive growth for mobile money transfers.”

By 2012, 364 million low-income, un-banked people could use mobile financial services. Likewise, the number of people without a bank account but with a mobile phone is estimated to grow from one to 1.7 billion.

This were some of the conclusion arrived at during the recently-concluded Mobile Money Transfer (MMT) Asia Pacific (APAC) conference in Manila, that brought in experts, providers and representatives of MMT practitioners from all over the world.

MMT Conference chairman John Owens noted that MMT initiatives are increasingly focusing on the importance of strategic partnerships between banks and mobile money issuers that build mobile money ecosystems, that include the base of the economic pyramid.

Owen is also the chief of party for the Rural Bankers Association of the Philippines (RBAP) — Microenterprise Access to Banking Services (MABS) program, supported by United States Agency for International Development (USAID) in the Philippines.

In the Philippines, the Bangko Sentral ng Pilipinas (BSP) is credited for being a progressive and flexible monetary regulator. Earlier, the BSP was singled out as the first central bank that spearheaded microfinance.

Mobile phone banking started sometime in 2000, and has since expanded with blinding speed. Both Smart Philippine Inc. (Smart) and Globe Telecommunications Co. (Globe) have since introduced programs and systems for mobile banking. They have likewise and partnered with bank and non-bank financial institutions to bring electronic money (e-money) to the under-banked and un-banked.

“Experts from around the world learned from the successful mobile money initiatives in the Philippines and discussed the directions that the market place is now moving in. Filipino mobile money leaders, Globe and Smart, and their rural and commercial bank partners, are considered pioneers in the mobile money transfer field,” Owen assessed.

Smart will expand its Smart Money electronic wallet (e-wallet) service to underserved and unserved markets under its Island Activation program.

Smart president and chief executive officer Napoleon Nazareno said there are more than 2.3 million active users of Smart Money. The subsidiary of the Philippine Long Distance Telephone Co. (PLDT) has also hooked up with MasterCard for mobile banking in Brazil.

Globe introduced GCash, an e-Wallet system, and the rural bankers immediately embraced the system. Partnering with over 50 rural banks, the system has surpassed P5-billion transactions.

Globe president and chief executive officer Ernest Cu said it now has 1.2 million customers use G-Cash to send and receive cash, and make payments via text messaging.

“Globe G-Cash is the most pervasive and possibly the biggest cash-in and cash-out network in the country,” he told the forum attendees.

Earlier this year, the Bank of the Philippine Islands (BPI), Ayala Corp. and Globe jointly formed BanKo Savings Bank, the first branchless bank utilizing mobile banking technology. It will virtually have a “manual” automated teller machine (ATM) through a partnership with over 15,000 Globe agents.

BSP Governor Amando M. Tetangco Jr., during his opening remarks at the conference said that the Philippines’ experience in MMT represents solid proof that the convergence of ideas for service innovations can create new pathways that benefit and transform lives of millions of people.

“In the Philippines, the major drivers for MMT are a large domestic market, our ground-breaking telecommunications companies, the continuously expanding banking sector, and responsive regulators,” Tetangco added.

Standard for Secure Mobile Phone Payments is on the Way

Originally Published on April 28, 2007

IDG News Service - The mobile phone industry has moved forward in its efforts to agree to a global standard for delivering secure services such as credit-card payments on handheld devices, according to an industry executive.

"There's momentum," said Nav Bains, projects director at the GSM Association (GSMA). "Everyone wants to move ahead."

Debate has been raging in the industry about where to locate the "secure element," or system for storing private data, in phones equipped with near field communications (NFC) technology.

NFC enables any two devices to connect and exchange information or access content and services simply by bringing them together over a distance of a few centimeters.

The technology is already being used for services such as mobile ticketing and could soon be used to replace plastic credit and debit cards in consumers' pockets around the world once a standard for securing private data is established, according to Bains.

The GSMA is pushing for the Universal Integrated Circuit Card (UICC) to become the standardized component for storing sensitive data in NFC-equipped mobile phones ...

Next week, the GSMA plans to issue a white paper with technical guidelines for enabling NFC-based services on mobile phones.

"The paper will focus on specific technical issues, which we believe will be useful to the standards bodies," Bains said.