Commercial banks are eyeing mobile banking as a potential way to harnessgrowing demand for online transactions, industry experts say.

Despite accounting for only a small portion of total markettransactions, mobile banking is fast becoming a must-have productoffered by Vietnamese banks.

"Mobile banking has beenand will be an indispensable product for the banking sector," saidManager of Bac A Bank's Card and e-Banking department Pham Dang Khoa.

Nguyen Chien Thang, manager of internet banking at Sai Gon - Hanoi Bank(SHB), agreed that mobile banking will be favoured by Vietnameseconsumers.

A rapid increase in the number of mobilesubscribers, cheap smartphones, improving network infrastructure and ayoung population are key factors driving the development of mobilebanking, he said.

Both representatives from Bac A Bank and SHB agreed that mobile banking has advantages over other products.

Thang said modern technologies integrated into smartphones will allowcustomers to make transactions whenever and wherever they need.

Banks need to provide applications for customers and offer themtechnical support to improve the quality of mobile banking, he added.

Meanwhile, Khoa believed that young consumers will be the focus of banks given the ubiquitous use of smart technology.

However, the biggest challenge facing mobile banking is how to approach customers, according to both managers.

"The banks have to design the application in the simplest way andinstruct their customers to set it up on their phones," said Thang.

Khoa added that the youth is not the ideal group for productsegmentation since they are not the ones with highest demand for bankingproducts.

Additional obstacles lie in maintenance andlarge investments are needed to integrate current services with mobilebanking, Khoa said.

However, the opportunities to deliver mobile banking to customers are increasing, according to Thang.

Around five years ago, modern technologies like smartphones, 3Gconnections or online payments were a rarity not trusted by customers.

Services requiring non-cash payments were even avoided bycustomers because of lack of confidence and credibility in onlinepayment systems.

Thang said he believes that the successof mobile banking could eclipse internet banking in the near future.However, the Government has a role to play in creating confidence bycreating a transparent legal framework, he said.

Thepopularity of mobile banking among consumers will also lie in thedesigning simple online applications that are secure andcustomer-focused.

However, banks should be patient and listen to their customers to improve the creditability of their products, said he.-VNA