Tyfone: Plug-and-Play Mobile Banking

I have previously covered Monitise, a mobile banking and payments platform for banks that has been incredibly successful in tying up partnerships with UK and US banks, as well as partnering with Visa to deliver mobile payment solutions.

In a recent article, Pymnts covers Tyfone, a competing mobile banking a payments platform.  Tyfone was founded in 2004 in Portland, Oregon and is funded by Ojas Venture Partners, a Bangalore based early-stage tech fund.  They target banks and credit unions and initial traction appears to primarily be with credit unions.

In terms of product differentiation, Tyfone emphasize the folowing features:  

• Mobile banking for non-online bankers: enabling all bank customers, including those that are not currently signed up for internet banking to quickly sign up for mobile banking 
• Account aggregation: enabling the user to manage all their accounts from the same interface 
• Secure ID management: Multi Factor Authentication (MFA)  to ensure secure log-in 
• NFC Contactless Payments: a flexible mobile wallet

This is clearly a fast-growing market that will develop very quickly.  In my opinion the success of Tyfone will be less about the technical sophistication of their product and more about their ability to build a network of bank partners.  I.e. a player with 'good enough' technology and a broad customer network will have a great chance of success than a player with the most advanced technology, but a less developed partner network.

The market is definitely big enough for another couple of players, so it will be interesting to see if Tyfone will choose to focus their efforts on credit unions or if they will go with a broader approach to business development.

Mobile Banking: Who's Driving the Innovation?

According to a Forrester study, 12% of the US online population, or 10 million Americans, currently use online banking.  Usage has more than doubled since 2007 and is expected to reach 50 million people by 2015.

The numbers illustrate that mobile banking is still very much in its infancy.  Most banks offer only standard features, such as check balances, transfer funds and pay bills, and 37% of respondents say they don't see any value in mobile banking.

To move the needle, the industry must figure out how they use the features of mobility to make mobile banking a unique experience.  This could come from mobile payments, location-based offers and coupons, peer-to-peer transfers, etc.  However, there is a lot of value in delivering these services, and we see new companies enter the space on a daily basis - posing the question of what role banks will play.

Increasingly we see banks put the faith of their mobile banking solutions in the hands of specialist providers.  Monitise is the most prominent example and has shored up much of the UK market, is growing fast in North America and expanding in Asia and Africa.

Although Monitise and similar companies have developed impressive solutions, it is clear that  innovation in mobile banking is unlikely to come from the banks, which may be ceding control of this very important customer service channel.

Monitise: Growth Through Partnerships

Earlier this month, Monitise, the UK-based mobile banking provider, announced that its European business has now reached month-to-month brake even.  In less than 10 years, Monitise has struck up partnerships with with most UK banks, including HSBC, Lloyds TSB, RBS and NatWest, signed up more than 3 million customers and is processing more than 10 million transactions per month. 

Key to Monitise’s success has been its flexible banking platform that allows it to work with all types of banks and carriers.  Moreover, it has a range of technical platforms that enable users to perform a range of banking services, such as check balances, view statements, pay bills and receive alerts, on mobile phones of all types, from SMS to iPhone apps.

However, what makes Monitise one of the most exciting companies in the mobile banking space is the partnerships it has struck up around the world.  Through these partnerships, Monitise is becoming the leading player globally and is entering the payments space. 

In 2009, Monitise announced a strategic alliance to develop mobile banking solutions for Visa, which would take a minority stake in Monitise.  This partnership has proven to be very powerful in positioning Monitise as an industry leader and facilitate global expansion.

In the US, Monitise partnered with FIS and entered as the first multi-bank, multi-carrier mobile banking platform.  The venture has proven successful and has now signed partner agreements with nearly 250 banks.

In Asia Pacific, Monitise announced a joint venture with First Eastern and will launch in Hong Kong as the first market.  Beyond Hong Kong, the Monitise has its sights on China, Japan, ASEAN and the Middle East.

Recently, Monitise has also announced launches in India and several African markets, such as Uganda and Nigeria.  In India, it will work with Visa and is interestingly integrating mass transport ticketing with its standard banking platform.

In addition to its geographic expansion, Monitise is also making very interesting moves in the payment space.  In February 2010, it announced that it would integrate Device Fidelity’s NFC capabilities in its global platform.

Furthermore, in November 2010, Monitise formed a join venture with Best Buy and Carphone Warehouse founder, Charles Dunstone, to develop an NFC network in the UK.  This network would initially leverage Monitise’s broad banking partnerships in the UK, Best Buy’s retail presence and Dunstone’s retail experience, to develop the network.

In December 2010, Monitise announced a partnership with ViVOtech, a leading near field communication (NFC) software developer, to deliver mobile phone payments services to banks across the United States.  With Monitise’s already broad base of bank partnerships, this deal could make it a major player in contactless payments when NFC enabled handsets are launched later this year.

In less than 10 years, Monitise has become a leading, global player in mobile banking and payments.  With its open mindset and platform, it has successfully forged powerful partnerships that have enabled it to build an emerging global presence and expand its product capabilities to contactless payments, mass transport ticketing and couponing.  Undoubtedly, Monitise will continue to strike up new partnerships and expand in new business areas, and is definitely “one to watch”.