TRAI seeks comments on USSD-based mobile banking services

With a goal to provide financial inclusion through mobile phones, telecom regulator TRAI has released a consultation paper seeking comments on use of unstructured supplementary service data (USSD) based mobile banking services.

USSD is a technology used by telecom players to send alerts to their users. It can be used for prepaid callback service, location-based content services and menu-based information services.

The TRAI said the fact that a large number of mobile subscribers in rural areas do not have access to banking facilities presents an opportunity for leveraging the mobile telephone to achieve the goal of financial inclusion.

“The USSD appears to be one of the most promising modes for mobile banking for financial inclusion. In order to identify and address the various issues related to USSD-based mobile banking for financial inclusion, the authority has issued the consultation paper,” the TRAI said.

Unlike short message service (SMS) messages, USSD messages create a real—time connection during a USSD session.

The connection remains open, allowing a two-way exchange of a sequence of data. This makes USSD more responsive than services that use SMS.

The TRAI said significantly large regions and populations in the country are still unbanked. As per the Census 2011, only 54.4 per cent of rural households had access to banking services.

“From the standpoint of equity, it is essential that financial services are provided at an affordable cost to those who are presently excluded from the formal financial system,” it added.

The Authority has sought comments if USSD is one of the most appropriate modes for mobile banking and is it appropriate to fix a ceiling of Rs 1.50 per USSD session.

The stakeholders are required to send their comments by October 4, 2013 and counter comments by October 11, 2013.

Source: http://cablequest.org/news/telecom-news/item/3271-trai-seeks-comments-on-ussd-based-mobile-banking-services.htmlSource: http://cablequest.org/news/telecom-news/item/3271-trai-seeks-comments-on-ussd-based-mobile-banking-services.html