A Brazilian unit of Bank of America Corp. is trying to turn mobile phones into mobile banking systems that would enable customers to access their online accounts from just about anywhere.
The unit, BankBoston Brazil, plans to begin offering the souped-up cellular phones by the end of July and hopes they will become the next must-have for corporate customers on the go.
"It will be possible to authorize payments and transactions from everyplace in Brazil and have information from checking accounts," said Angelo Fernandes, the director of cash management for BankBoston Brazil.
The bank, which caters to the high end of the market, hopes to have 10,000 people using the devices by yearend. It has 200,000 individual and 30,000 corporate customers.
BankBoston Brazil will use a Nokia Corp. handset and custom banking software developed by International Business Machines Corp. of Armonk, N.Y. The handset flips open to reveal a keyboard and a screen; it can connect to the Internet and run other software.
BankBoston chose a device that makes it "possible to have a mobile office also," Mr. Fernandes said.
"We expect that this idea can be exported to another branch [of Bank of America], even in the U.S.," he said, but he added that he knew of no current plans to use it outside of Brazil.
A Bank of America spokeswoman in the United States said that "we continue to watch the wireless market and evaluate the capabilities" but that she too knew of no effort to create a similar mobile banking service outside of Brazil.
Augusto Carvalho, the project leader for IBM's telecom practice in Brazil, said that though many sophisticated cell phones have a tiny Web browser, using them for online banking is unreliable because the connection is frequently broken.
"If you have an area of low communication coverage, you lose your connection to the bank" in the middle of an online banking session, Mr. Carvalho said. When that happens, he said, it may be unclear whether the bank has received the instructions; the customer may have to reestablish a connection and then go through the trouble of logging in again to find out.
That is why the Web browser included with the BankBoston device is not meant for banking. IBM developed special software based on the premise that the signal may be lost during a mobile banking session.
If it is, the software will hold on to the transactions until the connection can be reestablished, so the user need not log in again.
Each phone will have a unique digital certificate that will identify it to the bank and ensure that users can access only their own accounts. They must also type in their own password.
The first question customers have "is regarding the security of the solution," Mr. Carvalho said. "It's impossible to use another" mobile digital device to access a bank account, because it won't have the certificate.
BankBoston expects the idea to appeal to corporate customers and others who travel often, Mr. Carvalho said. For those far from their own computers, he said, the only way to initiate a payment today is often to reveal a password to someone who can log in to the bank's Web site.
Mr. Fernandes said the Nokia handsets cost $1,000 in Brazil.
Mr. Carvalho said that BankBoston will offer financing, and that by yearend customers will also be able to choose handsets from palmOne Inc. of Milpitas, Calif., or Motorola Inc. of Schaumburg, Ill.
Mark Greene, the general manager for global business at IBM, said there is interest in bringing the underlying concepts to this country.
"The BankBoston project in Brazil is sort of a test bed" for technology that may be imported to the United States, he said. "All of these technology themes are going to matter."
For example, he said, there is already interest in using cell phones in transactions, he said.
MasterCard has experimented with integrating its contactless payment cards into cell phones, and some U.S. cities allow residents to pay for parking by cell phone.
The digital certificates used to identify the Nokia device can be used to bring additional security to a home computer, and "a couple of banks in the U.S. are already piloting" such things, Mr. Greene.
Dan Schatt, a senior analyst for the Boston market research firm Celent Communications LLC, said that some companies tried offering financial services on Internet-capable cell phones around 1999. These failed, he said, partly because the old Internet phones "were big, bulky devices that couldn't really serve as phones" and had trouble making and holding connections.
Today's phones are better for banking functions, he said.
George Tubin, a senior analyst at TowerGroup Inc., a Needham, Mass., unit of MasterCard International, said that BankBoston has already tried to bring the mobile banking concept here. "They did a couple of programs, a couple of pilots, and it never caught on in the U.S.," he said.
"Wireless banking is not quite ready for prime time in the U.S.," Mr. Tubin said - but "at some point it will be."
