CHAPTER-4

CONCEPTUAL FRAMEWORK AND

INDUSTRY PROFILE

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INTRODUCTION
According to the RBI, Master Circular 2008 “Mobile Banking Transactions” means
undertaking banking transactions using mobile phones by bank customers that involve
accessing/credit/debit to their accounts. This definition by RBI not only defines the scope
of mobile banking but also indicates its mandatory parameters which are to be specifically
considered when we outline the boundaries for a study of mobile banking. The definition
clearly mentions what should be included as well as what should be excluded in the scope
of the study of mobile banking. Mobile banking policies in India aim to enable fund transfer
from an account in any bank to any other bank (interoperability) on real-time basis
irrespective of the mobile network the customer has subscribed to (TRAI, 2013).

4.1 Subsets of Mobile Banking

Mobile Accounting: Mobile Accounting is a transactional-based service centred on
a bank account that incorporates any type of money payment and receipt facilitated through
the use of a mobile phone, resulting in debit and credit to a bank account. It should also be
noted that mobile accounting services include services that are not transactional or
informational in nature but are linked to the bank account in some way, such as requesting
the bank to create a recurring account from an already existing saving account linked to the
mobile banking service or giving instructions to the bank for the closure or redemption of
an on going fixed deposit account, or instructing the bank to link Aadhar card to the bank
account.
Mobile Brokerage: Mobile brokerage is a feature of mobile banking that allows an
individual to link his bank account (which is registered for mobile banking) to his securities
account, which is used for the purchase and sale of securities, and thus manage the credit
and debit of funds associated with the trade of shares and securities.
Mobile financial information: Financial Information on the Go With the use of mobile
banking, you can utilize the mobile financial information service to inquire about and
obtain information about your bank account. For example, asking for information on the
account’s available balance, the latest five transactions made through the bank account,
and information on check clearance. Users of smartphones with a mobile banking app can
now utilize the service to pay their bills.
Detail view of facilities that can be availed through mobile banking.

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Both transactional and non-transactional/informational facilities can currently be availed
through mobile baking as listed below.
4.1.1 Transactional facilities (involving financial transactions affecting
bank accounts).
4.1.1.1 Fund transfer to another party/account
4.1.1.2 Fund transfer to deposits/portfolios/loans etc.
4.1.1.3 Payment towards online/offline purchases.
4.1.1.4 Recharge (prepaid phone/DTH/Broadband/DMRC etc.,)
4.1.1.5 Bill payment for utilities (post-paid telephone bills, electricity, gas, etc)
4.1.1.6 Tax Payment
4.1.1.7 Payment towards insurance premium
4.1.1.8 Transfer of funds to securities trading account
4.1.2 Non-transactional facilities (involving non-financial transactions
related to bank account)
4.1.2.1 Balance Enquiry
4.1.2.2 Mini-Statement (details of last three/five transactions) Cheque Status Enquiry
4.1.2.3 Stop Cheque Request
4.1.2.4 View presented bills
4.1.2.5 Block ATM/Debit card
4.1.2.6 Generate/change ATM/Debit card PIN
4.1.2.7 Credit card enquiry: - Last payment/balance available – Payment due date of
credit card etc. – Reward Points
4.1.2.8 Loan Account: - Amortization Schedule – Loan agreement copy –
Reschedulement letter – Income tax provisional/final certificate – Interest
certificate .
4.1.2.9 Demat/Securities: - Stock holding inquiry – Transaction status
4.1.2.10 Other Services : - Status of service requested – Locate ATM/Branch – Link
Aadhar Card.

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4.2 Non-transactional Banking:
The M-banking service was first introduced in the late 1990s by Paybox, a German
startup, in collaboration with Deutsche Bank. Initially, this service was employed in
European countries such as Spain, Sweden, Germany, the United Kingdom, and
Austria, and subsequently in poor countries such as Kenya in 2007. (Shaikh and
Karjaluoto, 2015). In India, ICICI bank was the first to offer a full-fledged mobile
banking service in 2008.
4.3Types of M-banking Services
M-banking allows clients to access personal banking services from a variety of banks
in a new way. It serves as an alternate channel for accessing personal banking services
and assists banks in significantly lowering the cost of providing these services. These
services are provided. There were 119 banks in India as of July 10, 2015. The RBI has
given them permission to provide m-banking services to its consumers. The expanding
The growing popularity of mobile banking has piqued the interest of various
stakeholders. Stakeholders interested in learning how different personal banking
customers see the service customers. Personal banking services are available in a
variety of forms. This new financial channel The personal banking services that are
available in most banks offer cash transfers (both transfers beyond the country) via m-
banking.
Positive and Negative Factors of Mobile Banking Technology
4.3.1 Positive Factors of Mobile Banking Technology
i. To control Fraud:
A very efficient technique to improve customer service could be to alert clients by
SMS at each and every transaction. This information is important in preventing fraud
because the account holder is always aware of transactions from his account. A bank
might employ mobile technology and SMS services to notify cardholders each time
they spend more than a specific amount on their cards.
ii. Reminder Facility:
Customers could be alerted of upcoming payments, such as loan repayment dates for
monthly instalments and the outstanding balance on their loan account, via mobile
banking. Customers may be notified that a bill has been given and that payment is due.
Customers can check their balance and authorize the required payment amounts over
the phone. Customers can also make a request for more information. They can

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 automatically view deposits and withdrawals as they happen, as well as schedule
payments or cheques to be written
. iii. User Friendly:
Nature Mobile banking through a cell phone is simple to use. The user interface is also
quite straightforward. To complete the transaction, simply follow the instructions. It
also keeps track of any transactions that are made. Menu-driven service,
confidentiality, authentication, integrity, non-disputability, time savings, and user-
friendliness are all advantages of using mobile banking. There is no need to recall
complicated codes, such as those used in online banking. The data must be safeguarded
in such a way that any unwanted access is prevented. Only once the users identity has
been verified and authorized can access to data be provided. To avoid data
modification during transmission, encryption measures must be used.
4.3.2 Negative Factors of Mobile Banking
i. Lack of Security:
Mobile banking is safer than computer banking because mobile phones face fewer
dangers it occurs when a mobile banking user receives a fraudulent text message from
a hacker requesting bank account information. Mobile banking is insecure due to a few
factors. A cell phone is easily misplaced or stolen. Every user‟s greatest dread is this.
Even if the phone is turned off and locked, it can be compromised in the hands of
someone who knows what they are doing if it is not sufficiently protected.
ii. Need for compatibility:
In order to use Mobile Banking, you must have a smartphone. Not every phone
supports mobile banking. Some banks do not offer any kind of mobile banking service.
Other than that, we can only utilize popular smartphones, such as the Apple iPhone
and RIM Blackberry, Android-based phones, and so on. If you don‟t have a
smartphone, you won’t be able to use any of the mobile banking services.
iii. Rapid Cost:
It may appear that the cost of mobile banking is insignificant. However, it is still
necessary to pay data and text messaging expenses. Some financial institutions charge
an additional cost for mobile banking services. Furthermore, it is necessary to pay a
charge for software. These additional fees make using mobile banking services
prohibitively expensive

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4.4 Benefits of mobile banking:
1. The benefits of mobile banking to the poor:
The impoverished gain from having access to loans at low-interest rates. They are also
spared from huge lines at the bank, saving both time and energy. Individuals, in the
end, profit from specialized banking services. Above all, it benefits the poor and the
government by allowing them to keep track of their finances, which aids in economic
progress.
2. Cost-benefit:
Banks will have to invest a significant amount of money to build the infrastructure
and systems needed to ensure that mobile banking runs smoothly. Banks, on the other
hand, do not need to open physical branches in a variety of remote and far-flung
locales. This aids banks in reducing costs associated which setup, maintenance, and
personnel. This lowers the strain on banks, which can be passed on to clients in the
form of lower financial service fees. Cost savings can be achieved by encouraging
customers to use online banking, which is an important goal for financial service
providers and banks.
4.5 Time benefit:
Customers waste a significant amount of time commuting to bank locations or ATMs
to complete transactions. They had to wait in long lines for banking transactions as
well. People who travel vast distances for financial transactions will find it much more
challenging because the branches are only open for a limited time. Customers‟
mobility is reduced by the convenience of transacting from anywhere and at any time
with a mobile phone. As a result, the cost of travel is lowered. Mobile banking can
provide real-time access to financial services, regardless of distance or time
constraints.
3. Personalisation:
Personalisation is the alteration of a service to meet an individual’s needs or
requirements. Mobile banking offers the ability to provide services tailored to the
individual’s needs (e.g. time, location and the choice of the user). These services bring
the marketer closer to the customer, allowing them to provide personalised push
marketing and thus boost the chances of a sale. This contributes to increased brand
awareness and, as a result, increased client loyalty.

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4.6 Challenges:
It is true that mobile banking provides a number of benefits, including lower costs,
more time, and the ability to use financial services according to one’s convenience and
proximity to a bank. However, there are a number of obstacles that must be overcome
in order for mobile banking services to be implemented smoothly at the BOP.
1. System:
Customers find it difficult to use mobile banking on phones with small displays,
low quality, and an unresponsive keypad. This is especially true for Bop
consumers, who frequently use small mobile devices with restricted functionality,
making the mobile banking application software’s operation even more
challenging. Due to their limited features and applications, these phones also
constitute a severe security risk. The range of mobile phones available, each with
its own set of functions, makes it challenging for banks to give a one-size-fits-all
solution. Mobile phones support various programs ways, for example, some
support Java while others just support the WAP browser or SMS. Some poor
countries have struggled to implement the solutions because to interoperability,
which is primarily reliant on technology.
2. Security:
Financial transactions are conducted from a remote location, and data is
transported through a system that involves multiple parties, making it more
difficult and vulnerable to security threats. WAP is used to communicate between
various devices such as mobile phones, PDAs, and other similar devices. WAP
allows internet banking to become much more functional. The technique of
encryption is used to secure data that is communicated, however it is insufficient
for complete security of sensitive data transmitted over the phone. Mobile
devices‟ minimal processing power and memory capacity do not support the
intricate encryption scheme, thus increasing the secure Technology.
3. Infrastructure:
More than financial intermediation, banks must generate social intermediation for
mobile banking to succeed at the bottom of the pyramid. This frequently
necessitates the creation of local institutions to bridge the educational, income,
gender, and geographic divides [17]. The cost of developing such locally
customised systems rises due to the need for institutional setup for financial data
processing. This represents the numerous costs connected with loan application

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 evaluation, processing, documentation completion, loan disbursement, repayment
collection, and non payment follow-up
4. Regulatory:
The regulatory environment is often rigid and prone to uncertainties in case of the
information technology. This acts as a barrier to create mobile banking solutions
and systems for the BOP. As per the guidelines people having a valid bank account
are only eligible to avail mobile banking services. This restricts the possibilities
of mobile banking to extend the financial services for the BOP and unbanked
customer.
4.7 Mysore city profile
Mysore, officially Mysuru, is a city in the southern part of the state of Karnataka,
India. Mysore city is geographically located between 12° 18′ 26″ north latitude and 76° 38′
59″ east longitude. It is located at an altitude of 770 m (2,530 ft) above mean sea level.
Mysore is situated at the foothills of Chamundi Hills about 145.2 km (90 mi) towards the
southwest of Bangalore and spread across an area of 155 km2 (60 sq mi). Mysore City
Corporation is responsible for the civic administration of the city, which is also the
headquarters of Mysore district and Mysore division.
It served as the capital city of the Kingdom of Mysore for nearly six centuries from 1399
until 1956. The Kingdom was ruled by the Wadiyar dynasty, with a brief period of
interregnum in the late 18th century when Hyder Ali and Tippu Sultan were in power. The
Wadiyars were patrons of art and culture. Tippu Sultan and Hyder Ali also contributed
significantly to the cultural and economic growth of the city and the state by planting
mulberry trees introducing silk in the region and fighting four wars against the British. The
cultural ambience and achievements of Mysore earned it the sobriquet of Cultural Capital
of Karnataka.
Mysore is noted for its heritage structures and palaces, including the Mysore Palace, and
for the festivities that take place during the Dasara festival when the city receives hundreds
of thousands of tourists from around the world. It lends its name to various art forms and
culture, such as Mysore Dasara, Mysore painting; the sweet dish Mysore Pak, Mysore
Masala Dosa; brands such as Mysore Sandal Soap, Mysore Paints and Varnish Limited;
and styles and cosmetics such as Mysore Peta (a traditional silk turban) and the Mysore
silk saris. Mysore is also known for betel leaves and own its special variety of jasmine
flower fondly referred as "Mysore Mallige". Tourism is the major industry alongside the
traditional industries. Mysore's inter-city public transportation includes rail, bus and air.

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4.8 Etymology
The name Mysore is an anglicised version of Mahishūru, which means the abode of
Mahisha in the vernacular Kannada. The common noun Mahisha, in Sanskrit, means
buffalo; in this context, however, Mahisha refers to Mahishasura, a mythical demon who
could assume the form of either a human or a buffalo, and who, according to Hindu
mythology, ruled the ancient parts of Mysore Kingdom, known in Sanskrit as Mahíšhaka,
centred at Mahishapura. He was killed by the goddess Chamundeshwari, whose temple is
situated atop the Chamundi Hills, after whom it is named. 'Mahishapura' later became
Mahisūru (aname which, even now, the royal family uses), and finally came to be
anglicised as Mysore by the British and Maisūru/Mysuru in the vernacular Kannada
language.
In December 2005, the Government of Karnataka announced its intention to change the
anglicised name of the city to Mysuru.This was approved by the Government of India in
October 2014, and Mysore was renamed, along with twelve other cities, on 1 November
2014.
4.9 History
The site where Mysore Palace now stands was occupied by a village named Puragere at the
beginning of the 16th century:The Mahishūru Fort was constructed in 1524 by Chamaraja
Wodeyar III (1513–1553): who passed on the dominion of Puragere to his son Chamaraja
Wodeyar IV (1572–1576). Since the 16th century, the name of Mahishūru has commonly
been used to denote the city: The Kingdom of Mysore, governed by the Wodeyar family,
initially served as a vassal state of the Vijayanagara Empire. With the decline of that empire
after the Battle of Talikota in 1565, the Mysore Kingdom gradually achieved independence,
and by the time of King Narasaraja Wodeyar (1637), it had become a sovereign
state: Seringapatam, near Mysore, the present-day Srirangapatna, was the capital of the
kingdom beginning in 1610: 257 The 17th century saw a steady expansion of its territory
and, under Narasaraja Wodeyar I and Chikka Devaraja Wodeyar, the kingdom annexed
large areas of what is now southern Karnataka and parts of Tamil Nadu, to become a
powerful state in the southern Deccan.
The kingdom reached the height of its military power and dominion in the latter half of the
18th century, under the de facto rulers Hyder Ali and his son Tipu Sultan. The latter
demolished parts of Mysore to remove legacies of the Wodeyar dynasty: During this time,
the kingdom of Mysore came into conflict with the Marathas, the British, and the Nizam
of Hyderabad, leading to the four Anglo-Mysore wars, success in the first two of which
was followed by defeat in the third and fourth. After Tipu Sultan's death in the Fourth

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Anglo Mysore War in 1799, the capital of the kingdom was moved back to Mysore from
Seringapatam: and the kingdom was distributed by the British to their allies of the Fourth
Anglo-Mysore War. Part of the kingdom was annexed into the Madras Presidency,
another to the Nizam of Hyderabad. The landlocked interior of the defeated kingdom of
Mysore was turned into a princely state under the suzerainty of the British Crown with
the five- year-old Wodeyar Krishnaraja III as titular ruler and with Purnaiah, who had
served under Tipu, as chief minister or Diwan and Lt. Col. Barry Close as Resident. The
British took control of Mysore's foreign policy and insisted on an annual tribute for
maintaining a standing British army at Mysore. Purnaiah is credited with improving
Mysore's public works. In 1831, claiming there was maladministration, the British took
direct control of the princely state. For the next fifty years, the kingdom of Mysore was
under the direct rule of British Commissioners and in 1831 the city of Mysore lost its
status as the administrative centre, when the British Commissioner moved the capital to
Bangalore.
In 1876–77, towards the end of the period of direct British rule, Mysore suffered from the
Great Famine of 1876–1878, in which nearly a fifth of the population died. In 1881,
Maharaja Chamaraja Wadiyar X was given control of Mysore, in a process called rendition,
but with a resident British officer and a diwan to handle the Maharaja's administration and
the city of Mysore regained its status as the capital. The Mysore municipality was
established in 1888 and the city was divided into eight wards. In 1897 an outbreak of
bubonic plague killed nearly half of the population of the city. With the establishment of
the City Improvement Trust Board (CITB) in 1903, Mysore became one of the first cities
in Asia to undertake planned urban development. Public demonstrations and meetings were
held there during the Quit India movement and other phases of the Indian independence
movement.
Until the independence of British India (which did not include Mysore) in 1947, Mysore
remained a Princely State within the British Indian Empire, with the Wodeyars continuing
their rule. After Indian Independence, Mysore city remained as part of the Mysore State,
now known as Karnataka. Jayachamarajendra Wodeyar, then king of Mysore, was allowed
to retain his titles and was nominated as the Rajapramukh (appointed governor) of the state.
He died in September 1974 and was cremated in Mysore. Over the years, Mysore became
well known as a centre for tourism; the city remained largely peaceful, except for
occasional riots related to the Kaveri River Water Dispute. Among the events that took
place in Mysore and made national headlines were a fire at a television studio that claimed
62 lives in 1989, and the sudden deaths of many animals at the Mysore Zoo.

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4.10 Administration and utilities
The civic administration of the city is managed by the Mysore City Corporation, which
was established as a municipality in 1888 and converted into a corporation in 1977.
Overseeing engineering works, health, sanitation, water supply, administration and
taxation, the corporation is headed by a mayor, who is assisted by commissioners and
council members. The city is divided into 65 wards and the council members (also known
as corporators) are elected by the citizens of Mysore every five years. The council
members, in turn, elect the mayor. The annual budget of the corporation for the year 2011–
2012 was ₹4.27 billion (equivalent to ₹7.5 billion or US$94 million in 2020). Among 63
cities covered under the Jawaharlal Nehru National Urban Renewal Mission, Mysore City
Corporation was adjudged the second-best city municipal corporation and was given the
"Nagara Ratna" award in 2011. Urban growth and expansion are managed by the Mysore
Urban Development Authority (MUDA), which is headed by a commissioner. Its activities
include developing new layouts and roads, town planning and land acquisition. One of the
major projects undertaken by MUDA is the creation of an Outer Ring Road to ease traffic
congestion. Citizens of Mysore have criticised MUDA for its inability to prevent land
mafias and ensure lawful distribution of housing lands among city residents. The
Chamundeshwari Electricity Supply Corporation is responsible for electric supply to the
city.
Drinking water for Mysore is sourced from the Kaveri and Kabini rivers. The city got its
first piped water supply when the Belagola project was commissioned in 1896. As of 2011,
Mysore gets 193,000 cubic metres (42.5 million imperial gallons) of water per day. Mysore
sometimes faces water crises, mainly during the summer months (March–June) and in
years of low rainfall. The city has had an underground drainage system since 1904. The
entire sewage from the city drains into four valleys: Kesare, Malalavadi, Dalavai and
Belavatha. In an exercise carried out by the Urban Development Ministry under the
national urban sanitation policy, Mysore was rated the second cleanest city in India in 2010
and the cleanest in Karnataka.
The citizens of Mysore elect five representatives to the Legislative assembly of Karnataka
through the constituencies of Chamaraja, Krishnaraja, Narasimharaja, Hunsur and
Chamundeshwari. Mysore city, being part of the larger Mysore Lok Sabha constituency,
also elects one member to the Lok Sabha, the lower house of the Indian Parliament. The
politics in the city is dominated by three political parties: the Indian National Congress
(INC), the Bharatiya Janata Party (BJP), and the Janata Dal (Secular) (JDS).

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4.11 Geography
Mysore is located at 12.30°N 74.65°E and has an average altitude of 770 metres (2,526
ft).[38] It is spread across an area of 286.42 km2 (111 sq mi) at the base of the Chamundi
Hills in the southern region of Karnataka. Mysore is the southernmost city of Karnataka
and is a neighbouring city of the states of Kerala and Tamil Nadu in the south, flanked by
the state cities Mercara, Chamarajanagara, and Mandya. People in and around Mysore
extensively use Kannada as a medium of language.
Mysore has several lakes, such as the Kukkarahalli, the Karanji, and the Lingambudhi
lakes. Mysore has The Biggest 'Walk-Through Aviary' called Karanji Lake in India. In
2001, total land area usage in Mysore city was 39.9% residential, 16.1% roads, 13.74%
parks and open spaces, 13.48% industrial, 8.96% public property, 3.02% commercial,
2.27% agriculture and 2.02 water. The city is located between two rivers: the Kaveri River
that flows through the north of the city and the Kabini River, a tributary of the Kaveri, that
lies to the south.
4.12 Demographics
As of 2011, Mysore city had an estimated population of 920,550 consisting of 461,042
males and 459,508 females, making it the third most populous city in KarnatakaMysore
urban agglomeration is the second largest urban agglomeration in the state and is home to
1,060,120 people, consisting of 497,132 males and 493,762 females. According to 2011
census, Mysore was the largest non-metropolitan city in India and had the highest basic
infrastructure index of 2.846. Mysore is estimated to have crossed 1 million in 2017 making
it a Metropolis. The gender ratio of the city is 1000 females to every 1000 males and the
population density is 6,910.5 per square kilometre (17,898/sq mi). According to the census
of 2001, 73.65% of the city population are Hindus, 21.92% are Muslims, 2.71% are
Christians, 1.13% are Jains and the remainder belong to other religions. The population
exceeded 100,000 in the census of 1931 and grew by 20.5 per cent in the decade 1991–
2001. As of 2011, the literacy rate of the city is 86.84 per cent, which is higher than the
state's average of 75.6 per cent. Kannada is the most widely spoken language in the city.
Approximately 19% of the population live below the poverty line, and 9% live in slums.
According to the 2001 census, 35.75% of the population in the urban areas of Karnataka
are workers, but only 33.3% of the population of Mysore are. Members of Scheduled castes
and scheduled tribes constitute 15.1% of the population. According to the National Crime
Records Bureau ofIndia, the number of cognisable crime incidents reported in Mysore

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during 2010 was 3,407 (second in the state, after Bangalore's 32,188), increasing from
3,183 incidents reported in 2009.
The residents of the city are known as Mysoreans in English and Mysoorinavaru in
Kannada. The dispute between Karnataka and Tamil Nadu over the sharing of Kaveri River
water often leads to minor altercations and demonstrations in the city. Growth in the
information technology industry in Mysore has led to a change in the city's demographic
profile; likely strains on the infrastructure and haphazard growth of the city resulting from
the demographic change have been a cause of concern for some of its citizens.
4.13 Economy
Tourism and IT are the major industries in Mysore. The city attracted about 3.15 million
tourists in 2010. Mysore has traditionally been home to industries such as weaving,
sandalwood carving, bronze work and the production of lime and salt. It has many big IT
companies like Infosys and Wipro. The planned industrial growth of the city and the state
was first envisaged at the Mysore economic conference in 1911. This led to the
establishment of industries such as the Mysore Sandalwood Oil Factory in 1917 and the
Sri Krishnarajendra Mills in 1920. Mysore has emerged as an industrial hub in Karnataka
next to Bangalore. Mysore is part of the Bidar-Mysore Industrial Corridor. Major drivers
of the economy are tourism, finance, manufacturing and industry which includes
chemicals, petrochemicals, machinery, automobile, engineering, textiles and food
processing sectors. A new industrial corridor plan is underway between Mysore and
Bangalore. For the industrial development of the city, the Karnataka Industrial Areas
Development Board (KIADB) has established four industrial areas in and around Mysore,
in the Belagola, Belawadi, Hebbal and Hootagalli areas. One of the major industrial areas
near Mysore is Nanjangud which will be a satellite town to Mysore. Nanjangud industrial
area hosts a number of industries like AT&S India Pvt Ltd, Nestle India ltd, Reid and
Taylor, Jubiliant, TVS, and Asian Paints. Nanjangud Industrial area also boasts being 2nd
highest VAT / Sales Taxpayer which is more than ₹4 billion (US$50 million) after Peenya
which is in state capital Bangalore. JK Tyre has its manufacturing facility in Mysore. The
city has emerged as a hub of automobile industries in Karnataka. The major software
companies in Mysore are Infosys, ArisGlobal, Larsen & Toubro Infotech, Excelsoft
Technologies and Triveni Engineering. The growth of the information technology industry
in the first decade of the 21st century has resulted in the city emerging as the second largest
software exporter in Karnataka (as of), next to Bangalore. Mysore also has many shopping

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