Cellphones to replace ATM cards

Cellphones may soon replace plastic cards for withdrawing and depositing money.

Some banks have already started testing the technology and may implement it later this year.

ICICI Bank has already started experimenting with card less transactions though it is not known which company’s technology platform they use. The bank has recently launched card less remittance service.

Apart from that, a Bengaluru based mobile payment solution provider mChek is working with banks in India and abroad to roll-out its card-less technology platform.

An employee of the firm, focused on mobile bill payment, recharge, flight bookings, and movie ticketing, says mobile phones can be the second level of authentication, beyond passwords, for establishing identities.

Airtel has this technology already in use.

Using two levels, rather than just one, implies a greater level of assurance.

Currently, when an ATM card is inserted into a machine and a pin entered, the combination of the two, which is registered with the bank, is sent for mapping.

Transaction is allowed if there is a match. In a card less world, the mobile phone number would be registered with the bank and instead of inserting the card into the machine, the user would type his mobile number on the ATM’s keypad.

He will then have to feed a pre-issued mChek pin number into his mobile phone.

This in turn will generate a random 10-digit pass code.

When this number is fed into the ATM machine, the combination of the phone number and pass code is sent to mChek servers through the bank for verification. The user can then proceed with his transaction.

By replacing cards with the cellphone numbers, banks could do away with the cost of issuing and dispatching the plastic.

“Moreover, a cellphone is more user-friendly and when stolen can be blocked whereas a stolen ATM card can be misused very easily,” said Mr Sanjay Swamy, the CEO of mChek.


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