Some banks have already decided to move in and surrender to the Sim banking technology seeing it as a great threat to the traditional banking systems. In computing and technology (SIM) stands for subscriber identity module most of the time the mobile phone service provider chip has been considered to be the SIM that's why its called SIM card. Recently most of the transactions are done using the SIM banking technologies and mobile services providers have come up with plans and schemes to make the services more convenient and efficiency. To the banks this is the big threat since they are so likely to lost their customers who use to bank with them, since they require ease of access services and the only way they can get it is through SIM banking.
Banks with a large retail customer base may find it convenient and profitable to introduce SMS banking as a package in order to retain customers. For cooperate bankers they may not require mobile banking since internet banking is enough for them, but actually how many people lives in the cooperate world in Africa?
If banks do not take mobile banking as a business opportunity and a chance to grow their income then they are risk loosing valuable customers and their deposits to those that offer it or to mobile phone companies. Most of the Tanzanians now are dwelling into the m-banking services since they are reliable to use and can be accessed easily and on time.
On contrarily 15 percent of Tanzanians has access to formal banking. Tanzania bankers association estimate that it is only 25 percent of that money is banked. A whooping 75 percent circulates informally. Estimates put it that more than US $ 10 million change hands in Kariakoo everyday.
The figures illustrate clearly since mobile banking does not requires you to follow some tiresome procedures of registration and standing in long queues waiting for your money hence for the 75 percent of informal money transactions are so likely to shift to the mobile banking rather than then traditional banking systems.
According to the Bank of Tanzania (BOT) governor Prof Benno Ndulu , the trustee account for such services deposited by the agents at various banks have it 97 billion Tanzanian shillings while transactions stand at 760,000 per day at the end of December last year. This means that mobile money transfer represents the future of banking . Banks have come in fighting for mobile money transfers but the BOT boss allayed fears that mobile banking could be the recipe for inflation as it has been alleged.
The banks now has to invest more in the technology and innovation with more flexible products and services to ensure they survive in the tough competition with mobile money transferring companies. The great initiative they should take is for themselves to start offering the mobile money services.