Guarding against fraudulent activities in mobile banking

Cell phone has added a new dimension to money transaction and banking system. This is called mobile banking system. The system involves the use of the cell phones in several types of banking transactions. Mobile banking differs from mobile payments, which involve the use of a mobile device to pay for goods or services either at the point of sale or a remote place.
The central bank issued guidelines on "Mobile Financial Services for Banks" in September 2011. However, the central bank has advocated for mobile operators and microfinance organisations to be active partners. It has provided licences to some banks to offer a full range of mobile financial services.
This regulatory certainty has allowed the market to move and by late 2011 and in 2012 two early leaders have emerged with the largest customer bases and agent networks. The bKash service is provided by BRAC Bank in cooperation with its subsidiary bKash and Dutch Bangla Mobile is a new service from Dutch Bangla Bank. These two providers provide for nearly 500,000 new mobile accounts and more than 9,000 new agents.
However this financial service system is at an early stage of development as providers are working to stabilise their technology, build agent networks and acquire new customers. This involves finding and training agents, marketing, helping customers transact and acquiring customers by using know-your-customer (KYC) and account opening processes. A survey conducted by the country's central bank found that the new services have covered most parts of Bangladesh and clients and agents concede that the service has proved valuable to them. The main reason for using this service is to send or receive payments. Rural users specially like the benefits of receiving payments.
Clients of mobile banking have crossed 15 million with 0.4 million joining the service in March this year. The increase in the number of clients is a concrete proof that this service has won over people. Mobile banking is the perfect platform for Bangladesh to take financial services to the country's largely unbanked population in an efficient and inexpensive manner.
Meanwhile, fraudulent activities in this service have also made people anxious. Accounts can easily be forged and money stolen. A number of reports show the use of mobile money transfer services by miscreants to carry out extortionist activities. Every system has its shortcomings or flaws. And some people will always find ways to use or abuse the flaws in a system for ill intentions. When ill intent is backed by technology, it can wreak financial disaster. Monitoring and controlling the payment activities is a must for preventing fraud. Once a problem is detected, it is very important for consumers to alert the concerned bank(s) and mobile payment company involved so that they can take timely action against the culprits or stop its recurrence.  
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