Dubai:Despite its promise of convenience, mobile banking remains unpopular among many residents in the UAE due to a number of misconceptions, a recent survey shows.

In a recent poll conducted by Rakbank that gathered 2,500 responses, over a third of respondents said they don’t find mobile banking to be a secure way to bank, citing that handsets can easily be compromised.

“I love the ease and convenience mobile banking provides, but I am wary of banking through a handset device that can be easily compromised,” one respondent said.

About 20 per cent of the respondents also hold a false belief that they need to own a smartphone to be able to conduct financial transactions through a mobile device.

Homi Ghandi, head of Rakbank Direct, said these are the two common misconceptions that need to be corrected. “Customers will be reassured to learn that mobile banking actually provides the highest level of security because, like online banking, the application does not store any sensitive information or transaction logs on the phone itself,” explained Gandhi.

In fact, customers can only register for mobile banking after completing the verification process, and the “robust” security features also ensure that mobile banking is personalized to the customer’s phone.

A combination of user ID, password and the customer’s handset is required to log into the mobile banking application via customer’s smartphone. In this case, even if the user ID and password for the customer is compromised, mobile banking cannot be accessed from any other handset.

“More importantly, financial transactions can only be performed through a transaction password, which is known only to the customer. In case the handset is lost, customers can call the bank to instantly disable their mobile banking user ID, ensuring that blocking mobile banking service is as simple as blocking a card in case it is lost,” added Gandhi.

Gandhi said customers don’t need to own a smartphone to do mobile banking. Rakbank, for one, has made mobile banking available on both smartphones as well as conventional handsets.

“Rakbank’s mobile banking service gives Etisalat subscribers the opportunity to dial *169# from their mobile phone and receive access to a menu of services,” said Gandhi. The customer is able to track his accounts, loans and credit cards, while enjoying a host of other services such as balance and investment enquiries, utility payments, fund transfers and requests to open new term deposits.

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BREAKOUT BOX:

With the mobile phone subscriptions in the UAE constantly growing and expected to reach more than 13 million in four years, it won’t be long before mobile banking becomes widespread.

Data collated by Euromonitor International showed that mobile phone subscriptions in the UAE are estimated to increase by 2.5 per cent on average a year to reach 13.9 million by 2017.

“Over the past few years local banks in the UAE have been rolling out their m-banking apps, catering to rising consumer needs for convenience and simplicity in the mobile banking space,” said Ali Abbas, senior regional consultant, Middle East, North Africa and Turkey at Euromonitor International.

Besides, residents in the UAE have already embraced the use of smartphones for online transactions, “with travel, application downloads and cinema tickets driving mobile commerce”, added Abbas.

Over recent years, banks have noticed a “gradual” increase in mobile banking uptake. At Rakbank, customers using the service jumped six fold from the first quarter of 2012 to the first quarter this year. Today, over 75 per cent of the bank’s customers are registered with the service and perform their utility payments through their phones, a three times increase from last year.

“Consumers in the UAE are gradually adopting its usage… In the near future, most payment transactions will happen on [mobile phones] be it buying airline tickets, paying school fees, insurance instalments, paying fines or any other transaction,” said Aref Al Ramli, head of electronic business and innovation at Mashreq.

Al Ramli said they have noticed a “substantial growth” in the number of customers registering for Mashreq’s mobile banking application, Snapp. “We are inclined towards having the largest consumer base registered on to our mobile banking application.”