DBS PayLah! takes on mobile wallet market
DBS has zipped in to tackle the mobile wallet space head-on, following a poorer-than-expected take-up of its existing virtual credit card service.
Its new mobile wallet - known as DBS PayLah! - was officially launched yesterday. With this mobile wallet, DBS customers can keep funds of up to $999 in the mobile application, and use that pool of money - drawn from a designated DBS savings or current account - as a source of funds to send money to other DBS customers. The daily transfer limit is also set at $999.
DBS expects this form of fund transfer to be more convenient than typical Internet banking transactions, since only the mobile phone numbers of payers and recipients are needed. Recipients are alerted by SMS, or an app notification.
Variants of mobile wallets in the market - such as the one hosted by PayPal - must still be funded by money held in bank accounts, said Louis Foo, head of the consumer banking group's eBusiness division at DBS, at a briefing yesterday.
"We built that wallet ourselves, so that the whole experience is seamless."
Mr Foo sees a critical mass in mobile banking usage. DBS has about two million Internet banking customers, and some 800,000 are mobile banking users.
Users can customise the settings such that all money sent via this app is not kept in the wallet, but is deposited straight into the recipient's designated savings or current account.
If a DBS customer receives money that exceeds the wallet's transfer limit - whether at the maximum of $999, or at a customised level - the excess amount is immediately transferred into his assigned account.
DBS had earlier launched Singapore's first virtual credit card on a mobile phone. The three telcos - M1, SingTel and StarHub - have also created mobile wallets linked to DBS's service, known as DBS One.Tap. The telcos and the bank planned to charge for the service eventually, having waived certain fees for a stipulated period.
But the usage has not been "as well as anticipated", said Mr Foo. He noted that the technology backing this service - known as near field communication - is not supported on the ubiquitous iPhones.
For comparison, the fund transfer service launched by OCBC earlier this month requires the recipient to input a passcode shared by the sender, and his account number. Besides the option of SMS, recipients can receive notifications via Facebook.
UOB's existing service, known as Mobile Cash, has allowed its customers to transfer up to $500 using mobile phone numbers since 2011, though it requires recipients to be pre-registered. The bank will be enhancing this service to make cash transfers more convenient, said Gilbert Chuah, UOB's group head of Internet channels.
The mobile wallet - which is free for download - excludes fund transfers from credit cards now, but DBS is open to providing that service. Mobile wallet providers in the US already have this service, but it comes with a fee charge.
DBS expects the service to be safe because it is limited to its customers, said Mr Foo.
If a thief successfully hacks into a person's phone and gains access to the mobile wallet, he can only go so far as to move all existing funds into his wallet, which can be tracked down by DBS. The initial setup and subsequent setting changes also need the use of the security token.
DBS is also conducting a pilot study for a mobile payment terminal for on-the-go merchants. The study should be done by the second half of the year.
