The attack of the clones!

India seems to be having a few banking hiccups on the reliability and customer service front and I see a rocky road ahead as customers become more discerning about the quality of their banking. Competition will certainly heat up but customers will prefer to pay more for reliability and ubiquity and this is where the established card players have built their reputations. A card solution is really pointless with India, as the fixed line and EFTPOS network isn't there and if you are going to use mobiles for communications then the card is superfluous.

At present India is like Europe with a large number of small communications carriers all trying to cash in on the mobile transaction market, however they are all vulnerable to trans-carrier, trans-border and trans-bank solutions which are better, more competitive, more highly-scaled and can provide global transactions which means lower costs.

Too many players in the transaction chain means higher costs and more risk and the risk is also concentrated within India.

I also see more potential for the banks to eat the telco's rather than the other way around, but not if they spend their money on new card infrastructure. It's a financial instrument, a concept, the card was just something people used to carry before they found something better - a mobile. Mobile telephony provision is much lower skilled than banking and therefore it is potentially easier for banks to become mobile telco's rather than vise versa - if the need arises.

If Mastercard and Visa are to be challenged, it had better be with a mobile, because I doubt that they can be beaten in the card stakes, their brands and expertise are too strong. It would be too expensive a failure for wise men to bear. I would not be looking to take them on in the card space, but the transaction space...