Your mobile could be your wallet...

...But not before the concept clears regulatory roadblocks.

Talks about your mobile becoming your wallet for all types of monetary transactions "" popularly known as the m-wallet "" abound these days. The value-added service (VAS) providers, however, rue that it will be another 18-24 months before the m-wallet can get over regulatory hurdles.

The reasons are manifold. Though India primarily remains a cash economy, it currently has over 50 million credit and debit cards, millions of bank accounts, and over 180 million mobile subscribers. Mobile commerce or m-commerce, then, appears to be a logical conclusion.

However, m-commerce in India currently comprises low-value transactions that centre around music downloads, logo downloads, picture downloads and ring tone downloads. There can be some banking and value-added services like news and stock alerts.

Besides, mobile ticketing (for cinema-goers, train and plane travellers) and mobile coupons (discount coupons that can be delivered on mobile and redeemed at counters by producing your mobile at counters) exist in small measure.

However, for the m-wallet to take shape, high-value transactions "" such as credit and debit card transactions, point-of-sale terminals, going to the merchant location, and paying through the handset "" need to take place.

On the technology front, one has to create an ecosystem of service providers, merchants, banks, and users coming on to the mobile platform. Creating standard platforms, which can interact with all systems, is another challenge that needs to be addressed. But VAS providers say the regulatory hurdle is the primary barrier.

"The mobile commerce industry will accelerate in the coming months. This would help in fostering the creation of a mobile payment medium like the mobile wallet. We believe regulatory authorities like the Reserve Bank of India (RBI) and Department of Telecommunications (DoT) will iron out the issues over the next 18-24 months," says Mouli Raman, CTO and Co-Founder of OnMobile, a Bangalore-based VAS provider.

Through a host of value-added services, mobile content distribution, and m-commerce, OnMobile caters to a large unspecified number of subscribers in the country.

In fact, it has been working with several banks and telecom operators on possible payment mechanisms.

"We are talking to players like banks and telecom players and working simultaneously on possible payment mechanisms on mobile phones. But it will still take a long time before it takes off in a big way among mobile phone users since we have a fairly complex economic system," concurs Raman, adding that concepts like m-wallets and other mechanisms are the need of the hour.

Ajay Adiseshan, founder and managing director, Paymate, another leading VAS player, corroborates: "Unlike e-commerce, which was restricted to number of subscriptions, m-commerce is growing in forms of utility, travel and entertainment payments across the country," he says.

Paymate was one of the first players to have introduced "SMS-to-buy" kind of SMS-based payment platform to retail customers for which, it had tied up with retail players like Future Bazaar, Gold Cabs and Planet M sometime back.

OnMobile, meanwhile, has introduced utility, travel, entertainment and assisted payments to certain clients wherein the user can himself key in his credit card numbers instead of giving it to any call centre executive, thereby ensuring safety of payments.

Raman is hopeful that 5-7 per cent of such utility payments will be done through mobile phones in next two years, with an average utility payment of Rs 900 per user.

According to Nitish Mittersain, CEO, Nazara Technologies, a mobile entertainment company, pre-paid cards with stored-value for other payments could be a possibility in the future. Whatever the option, the call, it appears, lies in the hands of regulatory bodies rather than technology vendors.