Scandinavia's largest bank has taken an important step toward letting its customers use their mobile phones to bank and invest in stocks.
Stockholm-based Svenska Handelsbanken AB last week began sending its financial advisers and selected customers stock market information on bank-provided Nokia Corp. smart phones. Handelsbanken plans to add account inquiries, bill payment, stock trading, and funds transfers to the service when it is made available to all of the bank's customers early next year. The system uses the Wireless Application Protocol, or WAP, industry standard.
"If you thought the Internet made an impact on the world, just wait until WAP services, like this one from Handelsbanken, become widespread," said Lars O. Gronstedt, executive vice president at the $115 billion-asset bank. "You can only attract so many people to (personal computers), but wireless is regarded as almost limitless."
The announcement is yet another sign that the wireless delivery of financial services, though still in an early stage of development, is picking up steam.
Also last week, Bank of America Corp. began providing banking services to Internet customers in California who have a Palm VII handheld organizer from Palm Computing Inc., a 3Com Corp. company. Meanwhile, Bank of Montreal and its U.S. subsidiary, Harris Bank of Chicago, have been testing banking services via mobile phones and Palm Pilots.
These institutions follow a number of U.S. brokerages that have introduced wireless trading. Fidelity Investments has offered wireless trading since last October through interactive pagers and more recently Palm VII organizers. Discover Brokerage, DLJdirect Inc., and Dreyfus Brokerage Services are among others offering wireless trading.
Sweden and its neighboring countries appear especially ripe for consumer adoption of wireless services, according to industry analysts.
More than 60% of people in Denmark, Finland, Iceland, Norway, and Sweden carry cell phones, according to International Data Corp. of Framingham, Mass. That compares with fewer than 30% in the United States. The region also boasts high levels of Internet use, according to IDC.
People in Sweden are already familiar with using mobile phones to communicate with their financial institutions. Using a character-based messaging system similar to e-mail, they can check account balances and make other inquiries, said Matthew Nordan, an analyst at Forrester Research in Cambridge, Mass.
The WAP standard will let banks do more than just answer queries, he said.
"It provides a more interactive user interface and lets banks take existing Web applications and reformat them for cell phones," he said.
The Handelsbanken system relies on software from International Business Machines Corp. to translate information into a condensed form that can be used by the limited displays of mobile phones.
The bank has not yet determined pricing for next year's rollout.