SMS banking is a form of mobile banking in which interactive financial services are offered through short messages, email, and fax. Some banks and financial institutions send messages to customers using SMS, enabling them to perform financial transactions using SMS.
Usually, two types of SMS banking services are provided:
- First, banks send messages to their customers to inform them of updated financial information and
- Second, customers send messages about financial inquiries and transactions. Bank SMS informs customers of account changes, updates them with the latest information, and provides considerate services.
SMSbanking service uses pull or push messages. Push messages are messages that banks send to their customers’ mobile phones without their customers’ requests for information. Basically, a push message is a mobile marketing message that alerts of any events in clients’ bank accounts, like big-amount withdrawals from ATMs or large payments involved in clients’ credit cards. SMS banking also alerts about due payments, payment-credited statements ready to download, etc.
Another SMS push message is OTPs (one-time passwords), the latest tool used to protect against cyber fraud. It also initiates customers using mobile phones to perform transactions and obtain information about their bank account balance, currency exchange rate, and interest rates updated by banks.
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What is SMS Banking?
SMS banking, or text or mobile banking, allows customers to perform various banking activities through text messages sent to their mobile phones. This secure and convenient service allows customers to check their account balance, pay bills, receive alerts, transfer funds, and more with text. It is a very helpful service for customers who can’t access the Internet for banking purposes.
How Does SMS Banking Work?
To use SMSbanking, you must register your mobile number with your bank so that SMS services can send and accept text messages. Customers cannot do basic banking and receive account updates via text message. To send SMS, you will need an API that can send messages. Mobile text message alerts are particularly designed for sending their customer’s text messages on a large scale.
With the SMS platform, customers enjoy user-friendly messaging that quickly sends messages to individuals or broader as needed. It can send scheduled messages at specific times and dates. Customers can set up automatically triggered messages. You can use SMS API to program the messaging process.
Using API requires a code per documentation, but it allows customers to connect their SMS services and software.
Whether you use API or not, you can send and manage text messages and view text reporting information.
SMS Banking Push and Pull Services Offered
It is offered by banks to their customers with a wide range of functionalities by push and pull services below:
Push services include:
- Periodic account balance reporting at the end of the month.
- Provide salary and other credits to your bank account.
- Payment of cheque issues and insufficient funds alert.
- Large withdrawals on the EFTPOS or ATM are on your debit card.
- Large payment on the credit card.
- Provide on-time password (OTP) and authentication.
- Give alert if payment dues.
- Get an alert e-statement ready for download.
Pull services include:
- Account balance inquiry.
- Electronic bill payment
- Mini financial statement
- Transfer money from saving to current account
- Stop payment instructions on cheque
- Request for a credit or ATM card if suspended
- Deactivate debit or credit card when lost.
- Foreign currency exchange rates and fixed deposit interest rate inquiry
What are the Benefits of SMS Banking
Using SMS bank-related messages can hugely boost the customer streamline and experience in their communication strategy. Nowadays, SMS banking services reevaluate the banking industry’s efficient and simple ways customers can access easy banking services. The massive benefits of SMS services are diverse and numerous, and they cater to the needs of individuals in different ways. SMS banking security services offer many benefits, making it a popular choice among bank customers.
SMSbanking allows customers to conduct banking transactions and has become a popular choice because it provides a secure and effortless way to manage their finances. It is designed to facilitate banking tasks via text SMS messages, enabling access to bank accounts, checking account balances, fund transfers, and many others. This is a cost-effective and convenient way for customers to manage their finances who need to access their account information quickly and easily.
Here are some benefits of SMS Banking services
Offer Variety services
It offers its customers various services, including account balance, fund transfers, transaction history, bill payment, etc. Customers can access their accounts anytime from anywhere without physically visiting the bank, which benefits those living in busy or remote areas with limited access to banking services.
Speed
SMS is super first to communicate with their clients and able to check account balance without internet access. SMS is instantly delivered to clients’ mobile phones as long as they have a mobile signal. There is no transmission delay or waiting for a WiFi connection or mobile data.
Texts are effective for delivering time-sensitive information that demands instant feedback from customers.
For example, clients need to enter an OTP to verify payment instructions. OTP payment sessions typically time out only for short periods, usually ten minutes, which can frustrate users and disrupt the transaction process. So, it helps to get their code instantly after requesting it.
Secure
It provides highly secure services that use a two-factor authentication process to ensure transactions are authorized by bank account holders. Moreover, banks also use advanced encryption techniques to safeguard personal and financial information that unauthorized parties can’t access, like OTP, where the integrity of the transmitted information prevents fraud and ensures secure transactions.
High deliverability
Text messages are rarely marked as spam or lost unless the client’s mobile phone switches off or becomes unreachable after several attempts. However, deliverability rates vary depending on the provider. Per the record, there is almost a 98% deliverability rate for text SMS sent through banks’ SMA API.
Real-time updates
SMS services provide their customers with real-time updates, such as transactions, that help them track their finance records. For example, bank customers can receive alerts on their transaction history, account balance, and information directly on their mobile phones. This service gained popularity due to security, real-time updates, convenience, and cost-effectiveness. It empowered clients to manage their financial records without physically visiting bank branches.
Cost-effective
They are sending SMS, a relatively cheap and cost-effective solution for banks, instead of making calls or emails. They are free or nominal chargeable compared to traditional banking systems. Text messages are convenient for customers, and they can avoid paying ATM fees by using SMS services to check all tasks without cost.
High open rate
SMS has impressively high open rates. Gartner reports a staggering 98% of recipients who open text after receiving it. It is a remarkable response rate at 45% engagement compared to the comparative stats of other communication channels. SMS is an ideal choice for banks or financial institutions conveying urgent information as it ensures customers will read messages. It is likely to be noticed and noticed.
Time-saving
It helps to save your time and eliminate the need to visit your bank branch physically. You can easily manage your financial activities without hassle or filing paperwork. These services feature particular benefits for remote workers who have busy schedules and can’t waste their valuable time.
How Bank or Financial Institutions Use SMS Banking Service?
SMS banking has become a basic part of modern financial services, offering customers a secure, first-class, and convenient way to interact. Here are some basic uses:
Account balance update: Customers can request and receive balance information when their accounts are reached without internet access. Some banks use keywords or short code numbers that clients can use to text requests, like “BAL” to number 12345, to get quick balance updates.
Transaction alerts: Customers instantly receive notifications about their deposit and withdrawal amounts.
Failed transaction alerts: Banks notify customers if they have insufficient funds for payment or technical errors and inform them of any suspicious activities.
Sending OTPs for secure login: SMS-based OTPs add a two-factor authentication secure security layer, safeguarding sensitive online transactions to access their account. These temporary codes are used to log in to customers’ accounts and reset passwords against unauthorized access.
Due Payment Reminders: Banks send SMS reminders for the remainder of due payments, such as loan EMIs and utility or credit card bills, to help customers avoid late fees and maintain good credit scores.
Fund transfers: It allows customers to transfer their money safely between other accounts via text.
Real-time transaction notifications: It notifies its customers when they make any transactions, such as cash withdrawals, online fund transfers, large amounts of transactions, cheque clearances, bill payments, and more. It also gives alerts for suspicious account activities, like unauthorized login.
Bank card blocking or cancellation: In an emergency, customers who want to cancel their cards instantly due to loss or theft can instantly block their cards by sending an SMS to their bank. The rapid response minimizes and avoids the risk of fraud.
Financial statement: Some banks provide this optional financial statement through rich communication services (RCS) messages.
Conversation: Modern banking supports customers in solving all inquiries and problems quickly. It can automate answering common questions without calling customer care, such as where the nearest ATM is located.
FAQs:
What services are offered by SMS Banking?
It offers a wide range of convenient information services to its valuable customers through text messages that can be quickly accessed without an internet connection.
Customers can check their balance account instantly, receive credit card alerts, fund transfers, bill payments, see the status of issued checks, request to stop payments, and more. Their services are available 24/7 and can be accessed from any location.
Can Joint Account Holders Use SMS Banking?
Yes, joint account holders can use and both account holders receive transaction alerts. One account holder is authorized to register their mobile number for the service.
How to Register for SMS Banking?
- Go to the bank’s branch physically or visit their website
- Complete the registration form online and share your mobile phone number
- Confirm account and identity details will receive an SMS confirming activation
After successfully registration it will take 5 working days.
Is There a Fee for SMS Banking Services?
SMS facility is free but it varies from bank to bank. Some banks offer free while other banks charge a nominal fee per SMS or fixed monthly subscription. Clients are charged for sending messages by mobile operators as per your billing plan.
How to Link Multiple Accounts to SMS Banking?
You can access all accounts and credit cards for SMSbanking. Request them to add additional numbers under the same mobile number, ensure all accounts are eligible, and follow verification of all steps then receive confirmation once activated.
