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BankOn's screen shots... safer credit cards
Cardless ATM operation? Bangalore inventor says yes!

System harnesses cell phone SMS to authenticate fund transfers, eliminate fraud

The mobile phone  might be the Secret Weapon or agni asthra that could  make   debit and credit card-based  transactions  fraud-proof . And   with a little software tweaking  at the ATM, the same technology will allow  people to  draw money securely,   from any ATM, anywhere,  even without a card.

This is the exciting prospect,  held out  by a Bangalore-based start-up with its patent-pending  technology that   a few India-based banks are already said to be examining.

In a special demo for IndiaTechOnline, Shourabh Shrivastav, founder-Chief Executive Officer of  3P Technologies ( India),  ( ) showed how a simple text message from one's mobile phone can provide an added layer of security when  one  uses a credit or debit card  to  pay, either online, or at point of sale  (POS) terminals.

The system  requires  the  user to register with  a "BankOn" service provider, who stores  the SIM and IMEI number of  each mobile phone, together with  last four digits of the credit/debit card.  When the user  offers  his or her card for swiping or enters the details online for an Internet transaction, the fund will be transferred only after checking with the BankOn service. This generates an SMS message to the specific mobile phone  registered by the user, with a query to confirm if indeed the   real owner of the card is doing the transaction and if  the amount sought to be  transferred is same as the one authorised by the user.  Only upon receiving an SMS confirmation will BankOn, clear  the payment through the card's own gateway. 

"This extra level of checking" will add just  some 10 or 15 seconds to transactions that typically take 30 to 40 seconds to go through" says  Shrivastav, "but in the process, it will completely eliminate the most common type of credit card frauds like spoofing, skimming  etc".

The other scenario that BankOn is promoting, involves payment from ATMs  -- to persons who might  not have any ATM card of their own. This will require a small   software change at  the ATM , but the benefit will be enormous, Shrivastav suggests.  This is how it will work:

The ATM  displays need to be modified to allow for a non-card mode of operation. If I want to send you  ( living in another city -- or for that matter,country) a thousand rupees or its equivalent, I use the BankOn service to send you  ( on your mobile phone via SMS),  a unique four digit code, as well as  telling you how much money I am sending.  You enter this code   at the ATM,  and the amount you want to draw ( it must exactly match the amount I am sending you). Through BankOn, I have also indicated  the mobile number of my beneficiary and the  STD/ISD code of his/her country/city.  The transaction goes through only when    ATM used matches the city, the amount  sought to be drawn is exactly same as the one authorised and the  unique code sent only to the recipient's phone  tallies.  "It's fool proof -- and it throws open the ATM network to millions who don't even have a bank account", claim  3P Technologies' engineers. 

There is another angle, they suggest: banks will have a strong incentive to make such card less ATM withdrawals easy:  they will  share revenue with the BankOn service provider for each transaction, though the customer might get it for free.  Shrivastav says he is already working on a  voice mode  of his solution, that will allow visually challenged bank customers to  safely draw money from  ATMs,  the cardless way. Modifying a standard  ATM to meet the Reserve Bank's new stipulation that every third new ATM should be disabled friendly, typically costs around Rs 50,000. The 3P solution suggests this can be achieved more cost effectively, even while growing the ATM;s usage beyond bank customers.

3P's Chairman  is former State Bank of India  Chief General Manager B.B. Saxena .

The Bank On system works with all Java and Symbian phones  but the inventors are working to extend it to all major  cellular platforms, including iPhone and Blackberry. It is independent of the phone handset as well as  telco service provider. (Bangalore Aug 24 2009)