The wallet phone was pioneered by the Japanese telecommunication major NTT-DoCoMo way back in 2004. This device has the functions of a cell phone and credit card with the help of a multi-application built-in smart card. This means that all your financial transactions involving ‘debit and credit’ cards can be performed wirelessly through your mobile. Show the phone with the smart card to a reader installed at a store, and your mobile phone is charged for the payment. The smart card uses the prepaid concept. In India, though, we will have a combination of a smart card as well as the power of the SMS. So sometime in the near future, if you want to eat out, buy movie tickets, book a flight, shop, all you would need to do is send an SMS! The mobile commerce Industry in India is still in its infancy though banks have been dabbling in it since 2002. Airtel launched a mobile wallet service in 2005. Many banks are now partnering with mobile payment providers to provide the service. M-commerce requires you to have a basic mobile, and a credit or debit card account with one of the partner banks. The current payment players in India are mChek, Obopay and PayMate. Transactions take place via encrypted text messages. To ensure that the entire process is secure, the Reserve Bank of India is formulating the regulatory guidelines for mobile payments. The final draft is expected by June 2008. Mobile Wallet is a JAVA based downloadable application, which can be used on a GPRS enabled phone. The phone will contain the details of the owner’s credit card and the application will initiate a payment or transaction securely after PIN verification. Here the transactions take place between the mobile phones and backend servers using GPRS thus eliminating security breaches. Here’s how it works : All your card information will now be stored in the phone so you don’t have to carry your heavy conventional wallet everywhere you go. For this, your mobile SIM card needs to be replaced with a software- enabled smart card from a service provider like mCheque.For instance, if you fancy a smart outfit from an outlet which is "MW equipped" , the retailer will use a special phone to send a message to your mobile indicating the amount you have to pay. On confirming your purchase with your unique four digit password, a confirmation SMS will be sent to you as well as the retailer and your purchase will become legitimate.You only pay for the SMS you send while validating the transaction.The entire process is secure and takes just about a minute.Above all, an item costing as low as fifty rupees can be yours with this technology. Bharti Airtel ,with it’s recent tie up with ICICI Bank and Visa Card, launched it’s mChq service in Delhi and Mumbai. At present, there are very few locations which accept this service as a mode of payment but efforts for expansion are being made. The wallet phone surges to take mobile commerce to another level but its success depends on overall "market reaction".The mobile wallet has to face the challenges of scalability, reliability and cost to effectively monopolize the Indian market.The cost involved in owning a mobile wallet cannot be ascertained at present, but the GPRS rates need to bet subsidized for the end-user.
