Will U.S. mobile banking fly?

* U.S. trails in enabling electronic transactions over cell phones

Wachovia, BancorpSouth, Regions Financial and SunTrust Banks announced recently that they would allow cell phone users to conduct electronic banking transactions and manage their accounts from their mobile devices. The advent of mobile banking services was a symbol of progress for the U.S.

However, the move also seemed to indicate that the “walled garden” syndrome in the U.S. cellular carrier environment was alive and well. At issue, of course, was the limitation that you have to be an AT&T/Cingular wireless customer to gain these particular institutions’ mobile banking privileges. So…if you’re a Verizon Wireless customer but bank with Wachovia, are you just out of luck? Or - as AT&T/Cingular likely hopes - are you willing to change carriers for the privilege of conducting personal banking transactions using your cell phone?

U.S. mobile carriers have long been hesitant to provide their subscribers with access to cross-network content and services. Rather, they tend to operate isolated (walled-garden) networks. They’ve even gone so far as to block calls to free conference-calling sites in regions of the country that charge them higher calling termination fees, as reported in this newsletter last week.

In the case of mobile banking, fortunately, competition seems to be playing a role. Financial competitors announced similar services to Wachovia’s a few weeks ago without the carrier restriction. Citibank, for example, announced a cell-phone-based mobile banking service in Southern California, scheduled for nationwide availability this summer. The service can be used with any cellular network and, reportedly, with more than 100 handsets. Bank of America launched a smaller carrier-agnostic mobile banking offering in Tennessee last month and says it will take the service cross-country by year-end.

Mobile banking has been available for more than two years in Europe and Japan. Is the U.S. behind technologically, or do U.S. customers just have so many other options that the demand has been light?

You tell me. Would mobile banking – or other mobile content or transaction services that aren’t yet available – benefit you or your organization?

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