As cellphone banking becomes increasingly popular, so does the risk of becoming a victim of fraud. This is all the more reason you should register your cellphone's SIM card as required by the Regulation of Interception of Communications and Provision of Communication-related Information Act (Rica) as soon as possible, Clive Pillay, the Ombudsman for Banking Services, says.
The 2008 All Media and Pro-ducts Survey found that 86 percent of South African households have access to at least one cellphone, and there are about 40 million active cellphone numbers in South Africa. (According to market research company Eighty20 Consulting, South Africa's population is just over 50 million.)
Pillay says the importance of Rica is highlighted by the fact that in 2005 banks lost R83 million to fraudsters using stolen or copied identity documents, while identity theft could have cost South Africa close to R1 billion last year.
"The use of technology in the banking realm has led to numerous scams. This is why it is so important that you are Rica-compliant: so that the opportunity for technological fraud is reduced to a certain extent," he says.
Pillay says the Protection of Personal Information Bill, which was tabled in Parliament in August, will offer you further protection against scam artists.
The Mobility 2009 research project, which was commissioned by First National Bank and conducted by market research company World Wide Worx, found that more South Africans use cellphone banking than internet banking. The study included research among 1 000 consumers in metropolitan areas, 1 000 small and medium enterprises and 240 large companies.
Arthur Goldstuck, the managing director of World Wide Worx, says 16 percent of bank clients in South Africa use internet banking compared with 28 percent who bank using their cellphones.
The study revealed that the main services used by cellphone bankers are balance inquiries and transaction notifications (three-quarters of cellphone bankers use only these two features). Just under half of all cellphone bankers use their cellphones to view bank statements, 35 percent to transfer money between accounts and 28 percent to pay accounts.
Goldstuck says only eight percent of cellphone bankers add beneficiaries via their cellphones, which is an indication of concerns over security and uncertainty over how cellphone banking works.
"Our research shows that although South Africans are becoming more comfortable with cellphone banking, precisely half of general banking customers are still nervous of it, citing trust as their major concern," he says.
Cellphone banking at the four major banks
- Absa.
Nearly 50 percent of the bank's clients use cellphones to interact with Absa in one way or another, Adrian Vermooten, the head of Absa's mobile channels, says. Absa has 1.4 million registered users of cellphone banking and 1.15 million internet banking clients. Vermooten says in the past year there has been a 105-percent increase in the number of cellphone bankers and a 175-percent increase in the number of transactions by cellphone.
- First National Bank (FNB).
More than one million clients use the full services offered by cellphone banking and well over five million clients use the cellphone notification service, compared with between 500 000 and one million clients who use internet banking, Len Pienaar, the chief executive of mobile commerce at FNB, says.
- Nedbank.
The number of cellphone bankers has increased by more than 90 percent over the past year and the cellphone banking user base is about 40 percent of the internet banking user base, Lee Albertyn, the head of Nedbank's virtual channels, says. However, Nedbank was unable to provide specific figures of the number of cellphone and internet banking clients due to a change in its systems.
- Standard Bank.
There is one active cellphone banker for every four internet bankers at Standard Bank, Tumi Monale, the director of self-service banking, says. "However, we have more than 1.3 million customers using our SMS notification service and this figure is growing exponentially," she says. Monale says the number of new cellphone bankers is growing at an increasing rate and is outstripping the number of new internet bankers each month.
What is Rica?
Rica - the Regulation of Interception of Communications and Provision of Communications-related Information Act - came into effect in July this year and compels you to become a registered cellphone user with your network provider. To do this, you must register your cellphone SIM card by the end of January 2011.
You need to register your SIM card at your cellphone network provider (Cell C, MTN, Virgin Mobile or Vodacom) if you are:
- An existing contract customer;
- An existing pre-paid customer;
- About to take out a new cellphone contract; or
- Buying a new pre-paid SIM card.
The information your network provider needs to make you Rica-compliant is:
- Your cellphone number;
- Your identity number, which you will have to verify by producing your green bar-coded identity document, a temporary identity certificate, or a valid passport or travel document and a certified copy of the verification document.
- Your residential and postal addresses; and
- Proof of your residential or employment address, using either a current utility account or a recent bank statement (not more than three months old).
Your cellphone network provider will keep a certified copy of your identity document on file.
If a minor buys a cellphone starter pack, his or her parent or guardian is responsible for registering the SIM card and providing the necessary Rica-related information.
If you fail to register by the January 2011 deadline, your SIM card will be disconnected from your cellphone provider and rendered useless until you meet the Rica requirements.