Mobile banking set to usher in sea change: RBI Chief

Hyderabad, Oct 20 (UNI) Reserve Bank of India (RBI) Governor Y V Reddy today said the payment and settlement chain may soon witness sea change with banking transactions initiated through a mobile phone.

Delivering the valedictory address at a international seminar on 'Payment and Settlement System' organised by the RBI, Institute for Development and Research in Banking Technology (IDRBT) and Bank for International Settlements (BIS) jointly here, Dr Reddy said the RBI had no objection to introducing mobile banking but it should be cheaper, faster and reliable.

The IDRBT was conducting pilot project in Andhra Pradesh to ascertain the viability of the new system which had to safeguard the interests of the clients and banks while executing transactions.

Pointing out the introduction of Real Time Gross Settlement (RTGS) system by many countries had paved the way for risk-free, credit push based fund transfers, he said the liquidity requirements for the RTGS were relatively higher.

'Our experience with RTGS showed that there are immence benefits but its popularity itself can give rise to some operational issues when the system is stabilising,' he said.

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