CIBC Kicks Off Wireless Banking Service

CIBC's wireless banking service, announced in April, is intended to take advantage of favorable demographics.

More than one in three Canadians has a mobile phone, according to the Canadian Wireless Telecommunications Association. Canadian cell phone ownership is higher among those who use the Internet; one in four online adults is interested in using Web-enabled cell phones, according to market research by NFO CFgroup.

Research from CIBC's own pilot program revealed that demand exists among tech-savvy customers and the on-the-go workers for wireless banking, and as connectivity and devices improve, demand is expected to grow steadily. "With 1.5 million CIBC customers registered for online banking, we see wireless service as part of the ongoing evolution of Web-enabled self-service options that our customers will expect from their financial institution," said Pattie Robb, senior vp of retail markets at Toronto-based CIBC, in a statement.

The new service allows customers to conduct day-to-day financial transactions through a choice of wireless carriers and mobile devices. Customers can check their account and Visa balances, transaction history, transfer funds and make bill payments using Web-enabled mobile phones, RIM wireless handhelds and other personal digital assistants (PDAs) as they become commercially available. CIBC's custom in-house wireless application is built on the ViaFone OneBridge Mobile Server, a powerful mobile enterprise software platform for both voice and data.

CIBC wireless banking is available to customers subscribing to Bell Mobility, Rogers AT&T Wireless or Telus Mobility service.

"This is an exciting time to be launching our wireless service as manufacturers are developing mobile devices offering improved Internet access and wireless carriers are introducing high speed networks that support these devices' capabilities," Robb said.

The CIBC launch comes as North America continues to lag Europe and Asia in adoption of wireless financial services. Only about eight percent of midsize and large banks offer wireless services, according to GartnerG2.

Still, the number of users of wireless financial services in the United States is projected by GartnerG2 to climb to more than 7 million by 2005, up from 500,000 last year. The number will reach 1.2 million this year and 2.6 million in 2003 as wireless services become available for receiving and paying bills, applying for credit and getting cash from an ATM or live teller.

"Compared to many other countries, U.S. consumer demand for wireless financial services is immature, but it's evolving rapidly," said Brad Adrian, research analyst at GartnerG2. Wireless device placements are reaching critical mass, he added.

The volume of Internet data exchanged via digital handsets increased between 2000 and 2001, but use of wireless application protocol interfaces is still very low. Only 15 percent of consumers who use wireless application protocols believe they are satisfactory, according to GartnerG2.

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U.S. Consumers Using Wireless Banking

2001...500,000

2002...1.2 million

2003...2.6 million

2004...4 million

2005...7 million

Source: GartnerG2