IBM and Ericsson bank on mobile finance

IBM is working with handset giant Ericsson to develop integrated financial services technologies that they claim will address users' fears of doing banking over mobile devices.

Big Blue acknowledges that consumers have been wary about carrying out banking transactions over mobile phones because of security issues and the fact that current services are simplistic and not integrated.

But the partners claim that they will offer banks a way of integrating their applications to offer services such as the ability to track stocks and use the same software to trade shares, to enable consumers to view all their accounts on one screen, and receive account alerts, for instance, when cheques clear.

Val Rahmani, general manager of IBM's wireless solutions division, said: "There are people that are doing bits and pieces on their mobile phones but we are integrating the whole thing. We are putting it all together to make it real and usable."

She explained that the key would be the ability for banks to link their back-end systems to wireless applications so that users would get up-to-date information about their accounts. But Rahmani admitted that overcoming users' concerns was paramount. "The challenge will be to demonstrate to the market that this is usable and safe," she said.

The companies' joint offerings, which will begin to be rolled out in the first half of the year, will combine Ericsson Mobile Internet application building blocks, such as Mobile e-Pay, Safetrader and Wap Gateway, with IBM's WebSphere middleware.

Big Blue claims that Deutsche Bank is already using a set of pilot services in Germany, including account activity alerts and account aggregation, which should be rolled out during this year.

Remus Brett, an analyst with researcher Datamonitor, said: "We firmly believe that next-generation mobile services are going to be critical for banks in the next two to three years. This alliance should enable banks to position themselves favourably."