First National Bank of South Africa Ltd. (FNB) last week officially announced that it has launched cell phone-based banking to its customers. This, according to FNB, is a first in South Africa (SA), even though some of its competitors had already piloted cell phone-based banking up to three years ago.

According to FNB, the biggest differentiator of its service is that it can be used on absolutely any cell phone, without the need for special 32k SIM cards or particular settings.

Len Pienaar, CEO of FNB Mobile and Transact solutions, says that, as part of the bank?s commitment to the banking charter, this solution will also bring basic banking services to rural and under-serviced areas, because of the high handset penetration and network coverage throughout the country.

?While we already have a wide network of ATMs and branches countrywide,? Pienaar says, ?... we saw the opportunity to include at least some of the 16 million-odd cell phones in SA as part of FNB?s banking channel. This offers our customers anywhere, any time banking services.?

According to FNB, the process of banking using a cell phone involves sending an SMS to a 5-digit number (similar to the method used to receive ringtones and logos from the likes of 35050 or Exactmobile). For example, if a user wishes to get an account balance, an SMS reading ?balance? should be sent to 31321. A request for a pin code (MOPIN) is then sent back to the cell phone, and the client needs to input this code and press the ?dial? button. A confirmation SMS then arrives with the successful completion of the transaction, providing the information requested by the user.

According to Pienaar, the service only currently works on FNB accounts, and has limited functionality. ?Users can purchase airtime for themselves or someone else, draw a mini-statement (past three transactions), get account balances and transfer money between their own FNB accounts,? he says.

The service works on all three of SA?s networks, and the ?31321? number is common across the networks. Registration is free at a branch or online. Costs involved vary, depending on the transaction, with discounts for Mzanzi bank account holders.

These fees, according to FNB, exclude the standard SMS rate charged by the network provider, which will be billed separately.

While the functionality is still limited, Pienaar says that the bank will continue to improve the service and, in time, offer more functionality, ?maybe eventually to a level of full-service banking,? he says.

FNB hopes to take on 100,000 users in the next 18 months, ?but there is a little bit of work to do to change the perception of cell phone banking,? adds Jordaan. Security is obviously of the highest concern, but FNB assures its clients that the system is secure. A certain level of tolerance has also been included to take into account spelling errors in SMS requests, FNB says.

Whether or not the system will see mass adoption, only time will tell. FNB is confident that it is two to three months ahead of its competitors with this service, and even hopes to gain some new clients who will open FNB accounts in order to use the service.