The Electronic Banking Internet Communication Standard ( EBICS ) is a German transmission protocol developed by the German Banking Industry Committee for sending payment information between banks, as well as between banks and client applications, over the Internet . It grew out of the earlier BCS-FTAM protocol that was developed in 1995, with the aim of being able to use Internet connections and TCP/IP . It is mandated for use by German banks and has also been adopted by France, Switzerland and Austria. Adoptions in different countries have resulted in specific operations being permitted by some banks while being disallowed by others.
60-584: EBICS is used in the Single Euro Payments Area : the standard can be used as the secure communication channel to initiate SEPA Direct Debits and SEPA Credit Transfers using the Internet. SEPA concentrates on standardisation of clearing protocols in the inter-bank networks. The SEPA-Clearing guidelines do not supplant any national clearing transmission protocols. Theoretically the national banking transmission standards could be prolonged for decades. In 2005,
120-420: A Java-enabled phone which will guide the user through the money transfer process. An SMS sent through a Java application on the mobile device is as secure as an Internet banking transaction, since it can be encrypted between the user and the bank. An SMS–IVR combination is used for transactions for mobile phones without Java capabilities. An SMS is sent to a phone number provided by the bank, and an IVR call-back
180-518: A bank account, managing the account, and having access to a set of financial services and products. To open an account, one has to satisfy the bank's KYC (Know Your Customer) norms. For the un-banked, providing a valid identity is a challenge. To that end, the Unique Identification Authority of India (UIDAI) has embarked on a mission to offer a single source of identity verification which can also be used to open bank accounts. Managing
240-472: A bank. The Reserve Bank of India (RBI) tended to this issue by creating the post of a banking correspondent (BC). The role of a BC is to act as an interface between the bank and its customers in places where traditional banking is not feasible. Banks can appoint a trusted third party as a BC in a village. All the villagers who wish to transact with the bank can get in touch with the BC. Deposit and withdrawal of money
300-409: A channel for accessing their bank accounts and put high interbank fund transfers in a secured manner with immediate confirmation features. With over 900 million mobile subscriber and robust payment infrastructure, IMPS is well positioned to fulfill its objectives of enabling bank customers to use mobile instruments as a preferred channel for accessing their banks accounts, remit funds and also sub-serve
360-596: A common EBICS for Germany and France was published. The German Bundesbank has adopted the EBICS transmission protocol on 28 January 2009 to accept clearing information to be routed to the SWIFTnet interbanking network . The Bundesbank will only accept SEPA statements via SWIFTnet FileAct or EBICS submissions. Most changes on the common EBICS involved to embed the French ETEBAC-3 message types and ETEBAC-5 signature elements into
420-630: A country are normally part of SEPA. However, the following countries have special territories which are not part of SEPA: Jurisdictions using the euro that are not in SEPA: Akrotiri and Dhekelia , French Southern and Antarctic Lands and Kosovo . Jurisdictions in Europe not formally belonging to SEPA normally use SEPA schemes anyway for international euro payments, especially to or from the eurozone, with exceptions such as fees charged and BIC required. SEPA guarantees that euro payments are received within
480-406: A guaranteed time, and banks are not allowed to make any deductions of the amount transferred, introduced by a regulation in 2001. Banks and payment institutions still have the option of charging a credit-transfer fee of their choice for euro transfers if it is charged uniformly to all EEA participants, banks or payment institutions, domestic or foreign. This is relevant for countries which do not use
540-760: A payee, the delay being less than ten seconds, initially, with a maximum of twenty seconds in exceptional circumstances. This scheme was launched in November 2017, and was at that time operational for end customers in eight Eurozone countries. As of 2024, not all banks offer their customers instant transfers; however, in March 2024 the EU adopted the Instant Payments Regulation which requires all banks to offer instant transfers from January 2025 (incoming transfers) / October 2025 (outgoing transfers). Direct debit functionality
600-493: A rate of 3.5 percent. Lower income groups will make smaller transactions with mobile wallets by 2025. The un-banked population can be classified into broad categories: those who do not open accounts due to lack of banking infrastructure, those who for various reasons (such as poverty and lack of valid identity papers) do not pass the required account opening criteria, and those who currently see no requirement to open an account. This process can be broken into three aspects: opening
660-430: A trusted source. However, India is the second-largest telecommunications market and has 1100.37 million mobile phone customers. Estimated 812 million Indians used their mobile phones to access the internet. Mobile phones are quite common even in the remote villages. The mobile phone industry is growing at a rate of over 200 million per year. It was expected to touch the one and a half billion mark by 2015. The share of
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#1732876892485720-435: A vast non-banking population, most of whom reside in the rural areas. The traditional banking industry can not cater to the needs of India's large rural populace. Setting up a conventional bank branch in a rural area would require considerable amounts of money to be spent on infrastructure and additional personnel. Most rural Indians are cut off from access to basic financial services, which include deposits and withdrawals from
780-593: Is bank -led. Customers wishing to avail themselves of this service will have to register with banks which provide this service. Currently, this service is being offered by several major banks and is expected to grow further. Mobile Payment Forum of India (MPFI) is the umbrella organisation which is responsible for deploying mobile payments in India. India is the world's largest-growing mobile payments market. Mobile payment surpassed credit card transactions in 2021, clocking an annual value greater than $ 1 trillion. India has
840-404: Is a mode of payment using mobile phones . Instead of using methods like cash, cheque, and credit card, a customer can use a mobile phone to transfer money or to pay for goods and services. A customer can transfer money or pay for goods and services by sending an SMS , using a Java application over GPRS , a WAP service, over IVR or other mobile communication technologies. In India, this service
900-697: Is a payment integration initiative of the European Union for simplification of bank transfers denominated in euros . As of 2020 , there were 36 members in SEPA, consisting of the 27 member states of the European Union , the four member states of the European Free Trade Association ( Iceland , Liechtenstein , Norway and Switzerland ), and the United Kingdom . Some microstates participate in
960-418: Is available over a wide range of communication channels. The following communication channels are often used in combination to provide a complete end-to-end service: A user will use a particular set of communication channels depending on the capabilities of the mobile phone. The implementation of the standards will vary depending on the set used. Most banks provide a Java application that can be downloaded on
1020-492: Is based on the International Bank Account Numbers (IBAN). Domestic euro transactions are routed by IBAN; earlier national-designation schemes were abolished by February 2014 (with delays in some countries), providing uniform access to the new payment instruments. Since February 2016 Eurozone payment system users no longer require BIC sorting information for SEPA transactions; it is automatically derived from
1080-514: Is being explored for schemes like NREGA . Mobile payments could also open the possibility for new business models, as now one would have the ability to pay and receive even small sums of money, almost instantaneously. A variety of value-added services based on mobile payment transactions are already entering the market. There are various drivers that push the need and desire of mobile payments services in India, and there are several challenges which need to be addressed in order to ensure adoption of
1140-405: Is handled by the BC. When a person deposits money at the BC, their account immediately gets credited. The person can then use their mobile phone for additional transactions. The major difference between mobile banking and mobile payments is the total absenteeism of the bank account number . In mobile banking or Internet banking , money can be transferred only when the account number of the payee
1200-490: Is initiated by sending the following details: Depending on the type of the transaction, either both parties (payer and payee) or only a single party is notified about the transaction. A successful transaction will be notified by an SMS to both parties. The communication between the MPPs and the banks takes place using ISO 8583 message format, which is the standard message format for all financial messages in India. In order to test
1260-428: Is known before-hand. The account of the payee has to be registered with the payer and only then can a fund transfer happen. In mobile payments, the account number is masked from being public. One need not know the account number of a person to transfer money. This opens up a range of possibilities from buying tickets to paying auto fare, both of which would not have been feasible had the account number been mandatory for
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#17328768924851320-441: Is made considerably easier, if the payment for topping up the mobile account can also be made over the mobile phone. There are already many online recharge options available and emerging, which point to the rapid growth in this business segment. Mobile payments can also be used to remit money. Migrant workers (from other states) in India need to transfer money to their kin in their native states. Using this service, transfer of money
1380-438: Is much easier over a mobile device. In this context, mobile payment solutions can certainly help by providing an effective channel for money transfer for both categories of the un-banked. The issue of depositing money into a bank account where banks do not have a presence is addressed by the concept of banking correspondents. Though mobile payments allow payments to be made electronically, they do not enable depositing money into
1440-482: Is provided by two separate schemes. The basic scheme, Core SDD , is primarily targeted at consumers and was launched on 2 November 2009. Banks offering SEPA payments are obliged to participate in this scheme. A second scheme, B2B SDD , is targeted towards business users. Banks offering SEPA payments are not obliged to participate in this scheme (participation is optional). Among the differences with respect to Core SDD : SEPA consists of 38 countries: All parts of
1500-857: Is room for interpretation, it is expected that several PAIN specifications will be published in SEPA countries. Businesses, merchants, consumers and governments are also interested in the development of SEPA. The European Associations of Corporate Treasurers (EACT), TWIST , the European Central Bank , the European Commission , the European Payments Council, the European Automated Clearing House Association (EACHA), payments processors and pan-European banking associations – European Banking Federation (EBF), European Association of Co-operative Banks (EACB) and
1560-686: Is safe, fast and effective as established by a pilot study conducted. This has potential to act as a very significant driver for adoption of mobile payment services in this demographic. Bill payments provide convenience for the user and for utility companies. For payment to merchants, they offer another medium for the customer which vastly reduces cash management. Mobile payments can have a large impact on interaction with government services and are being explored in India. Mobile payments are convenient to track and account for, key requirements in government payment transactions. Government to peer payments can also be made easier by using mobile payment channels and
1620-498: Is used for authentication and the transaction is carried forward as a voice-based transaction, at the end of which the user will be prompted to enter the MPIN. The SMS channel is used to send notification messages, while the IVR channel which is as secure as a GSM channel . A transaction can also be initiated over USSD . A USSD session will provide the user with simple prompts over a menu allowing
1680-539: The European Parliament mandated that charges in respect of cross-border payments in euros (of up to EUR 50,000) between EU member states shall be the same as the charges for corresponding payments within the member state. However, the EU Regulation does not apply to all SEPA countries; the most significant difference is the inclusion of Switzerland in SEPA but not the EU. The rule of the same price applies even if
1740-566: The European Savings Banks Group (ESBG) – are playing an active role in defining the services which SEPA will deliver. Since January 2008, banks have been switching customers to the new payment instruments. By 2010, the majority were expected to be on the SEPA framework. As a result, banks throughout the SEPA area (not just the Eurozone ) need to invest in technology with the capacity to support SEPA payment instruments. SEPA clearance
1800-537: The law of one price . Both consumer and producer welfare increased. Mobile payments can have a positive impact on welfare by easing operational aspects and associated costs of cash-based transactions related to cash handling, storage and transfer, and by providing a strong platform for financial inclusion. On November 22, 2010, NPCI launched Immediate Payment Services (IMPS) to offer an instant, 24-hour×7, interbank electronic fund transfer service through mobile phones. IMPS facilitate customers to use mobile instruments as
1860-412: The mobile network and the bank to which either of the persons belong. This is referred to as interoperability and is a key concern for any major technology to be successful. In India, the model for the delivery of IMPS will be bank-linked; which implies that customers wishing to avail themselves of this service should have: In contrast, in economies such as Kenya, the mobile network operators lead
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1920-541: The EBICS transmission format. Previously ETEBAC was transported via X.25 packet network lines (in Germany the BCS-FTAM protocol used ISDN direct lines). French Telecom closed its X.25 network in November 2011. The Austrian banking sector began transitioning to the EBICS 3.0.2 protocol for commercial banking operations, replacing the current local MBS (Multi-Banking System) standard starting in November 2023. This migration includes
1980-527: The EBICS transmission protocol and support for BCS-FTAM ended on 31 December 2010. On 14 November 2008, a cooperation with the French " Comité Français d’Organisation et de Normalisation Bancaire " (CFONB – standardisation office in the banking sector of France) was pronounced such that EBICS would be adopted for usage in France. On 5 May 2009, a joint committee was created to resolve a modified EBICS. On 12 February 2010,
2040-529: The European Payments Council (EPC), made up of European banks. The EPC is committed to delivering three pan-European payment instruments: To provide end-to-end automated direct payment processing for SEPA-clearing, the EPC committed to delivering technical validation subsets of ISO 20022 . Whereas bank-to-bank messages (pacs) are mandatory for use, customer-to-bank payment initialization (PAIN) message types are not; however, they are strongly recommended. Because there
2100-633: The German Zentraler Kreditausschuss (ZKA / Central Credit Committee ) initiated a project to replace the national banking clearing system based on FTAM (short BCS-FTAM). The design goals were specifically set to create a transmission protocol that can be used by other countries as well. On 1 January 2006, the new EBICS transmission protocol was included in the German DFÜ-Abkommen ( EDI -Agreement – enacted first on 15 March 1995). Since 1 January 2008, all German banks must support
2160-497: The IBAN for all banks in the SEPA area. An instant 24/7/365 payment scheme named SCT Inst went live on 21 November 2017 allowing instant payment 24 hours a day and 365 days a year. The participating banks will handle the user interface and security, like for existing SEPA payments, e.g. web sites and mobile apps. As of August 2014, 99.4% of credit transfers, 99.9% of direct debit, and 79.2% of card payments have been migrated to SEPA in
2220-526: The account is something that mobile money solutions will make much easier, faster and cheaper, both for the customers and the banks. The key challenge is to determine if it is possible to devise demand driven financial products and services which make for a compelling reason to open an account. For example, a common need is a low value, low cost loan, for which the un-banked can typically offer no collateral. If this need can be addressed, via an appropriate business model, then managing that loan in terms of repayments
2280-491: The bank of the user and three digits used to identify the account of the user. A mobile number and a MMID will uniquely identify a customer's account with the respective bank. The design of the MMID allows customers to operate multiple bank accounts linked to a single mobile number; each bank account has its own MMID. Additionally, since the MMID of the payee must be entered along with the payee's mobile phone number, it serves to reduce
2340-482: The bank's gateway, this SMS is processed by a mobile payment provider (MPP). The role of MPP is defined in the standards document. After appropriate checks with the customer's bank, the transaction is forwarded to a central switch . The role of the switching agency is played by the National Payments Corporation of India (NPCI). NPCI routes transaction to the payee's bank based on the MMID. A transaction
2400-413: The bank-client transmission including statements of account (MT940/STA) and for interbanking clearing. Certain operations remain consistent across different versions of the standards, while others have been removed or introduced in newer versions. Most banks provide support for multiple versions of the standard simultaneously. Single Euro Payments Area The Single Euro Payments Area ( SEPA )
2460-401: The compliance and conformance to the standards set and the message formats, a certification lab is being set up at IIT Madras. The Mobile Money IDentifier (MMID) is the key identifying detail of a user participating in a transaction. An MMID is a seven-digit number given to a customer upon registration with a bank for the service. In the seven digits of the MMID are four digits used to identify
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2520-408: The development of mobile financial services. Choosing a bank-linked model enables offerings of a variety of value added financial service built on top of the basic mobile payment transaction. The idea of mobile financial solutions will only then permeate to all levels of society: customers, merchants, business houses and the government. The technical standards are set up by MPFI, and are implemented by
2580-705: The early adoption of the complementary signatures change request (CR-EB-22-05), following an anonymous vote by Austrian banks. The EBICS protocol is based on an IP network. It allows use of standard HTTP with TLS encryption (HTTPS) for transport of data elements. Routing data elements are encoded in XML and secured through signing and encryption using X.509 PKI certificates, which replaced the older RSA keys. Signing and encryption were optional until version 3.0, after which they became mandatory. The EBICS transmission protocol can be used to wrap SEPA-XML statements as they come forward. The standard does include two major areas – for usage in
2640-521: The euro area. The official progress report was published in March 2013. In October 2010, the European Central Bank published its seventh progress report on SEPA. The European Central Bank regards SEPA as an essential element to advance the usability and maturity of the euro. SEPA VS SWIFT: UNDERSTANDING INTERNATIONAL MONEY TRANSFERS Mobile payments in India Mobile payments
2700-673: The euro. This means that domestic payments in SEPA countries not using the euro will continue to use local schemes, but cross-border payments will use SEPA and the euro with eurozone countries to a high degree. The Nordic countries (other than Finland) do not use the euro and have no plans to adopt the euro. These four countries (Sweden, Denmark, Norway, and Iceland) started initiatives during 2017–2019 for simpler, faster, and cheaper cross-border payments between one another. These initiatives have however not been successful. The different functionalities provided by SEPA are divided into separate payment schemes. SEPA Credit Transfer ( SCT ) allows for
2760-530: The euro; where domestic transfers in euros by consumers are uncommon, and inflated fees for euro transfers might be charged in these states. Sweden and Denmark have legislated that euro transfers shall be charged the same as transfers in their own currency; which has the effect of giving free euro ATM withdrawals, but charges for ATM withdrawals in other currencies used in the EU. In regulation (EC) 924/2009 (the Cross-border Payments Regulation),
2820-477: The eurozone, for example when they take a job in a new country. The project includes the development of common financial instruments , standards, procedures, and infrastructure to enable economies of scale . As of 2007 , it was estimated this could reduce the overall cost to the European economy of moving capital around the region by up to 2–3% of total GDP ). SEPA does not cover payments in currencies other than
2880-540: The first milestone was missed due to a delay in the implementation of enabling legislation (the Payment Services Directive or PSD) in the European Parliament . Direct debits became available in November 2009, which put time pressure on the second milestone. The European Commission has established the legal foundation through the PSD. The commercial and technical frameworks for payment instruments were developed by
2940-511: The goal of electronification of retail payments. As of April 2023. there are 722 member banks which provide IMPS as a service. The basic aim of IMPS is to also enable micropayments on low-end mobile devices which support only voice and text, in addition to higher-end phones which could support web browsing or Java application capabilities. A person who has subscribed to a mobile payment service should be able to send money to any other person who has subscribed as well. This should be independent of
3000-419: The mobile phone as an economically viable instrument to enable inclusive access to financial services. Mobile telephony has had an impact mainly by allowing for agents in information restricted areas to engage in more optimal arbitrage. The adoption of mobile phones by fishermen and wholesalers resulted in a dramatic reduction in price dispersion, the complete elimination of waste, and a near-perfect adherence to
3060-404: The possibility of an erroneous transaction when the payer inadvertently enters an incorrect mobile number. The MMID is not intended to be a secret – it is simply an identifier and it does not give away any sensitive information about the customer. For example, a merchant will advertise his mobile number and MMID publicly in order to receive payments from the customers. The mobile payments service
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#17328768924853120-414: The technical schemes: Andorra , Monaco , San Marino , and Vatican City . SEPA covers predominantly normal bank transfers. Payment methods which have additional optional features or services, such as mobile phone or smart card payment systems, are not directly covered. However, the instant SEPA payment scheme facilitates payment products also on smart devices . The aim of SEPA as stated in 2008
3180-455: The technology in the Indian context. One of the key roles of The Mobile Payment Forum of India is to address these challenges that may inhibit the widespread use of mobile financial services. As per report from RedSeer Consulting, Indian market consist of 160 million unique mobile payment users till 2020 which will increase to 800 million by the year 2025 with transaction volume of Rs.7,092 trillion at
3240-408: The transaction is sent as an international transaction instead of a SEPA transaction (common before 2008, or if any involved bank does not support SEPA transactions). Regulation 924/2009 does not regulate charges for currency conversion so charges for non-euro transactions can still be applied (if not banned by national law). There were two milestones in the establishment of SEPA: For direct debits,
3300-569: The transfer of funds from one bank account to another. SEPA clearing rules require that payments made before the cutoff point on a working day be credited to the recipient's account by the next working day. The scheme was introduced in January 2008. In February 2014 it replaced the national credit transfer schemes, and later made the use of International Bank Account Number mandatory for transfers. SEPA Instant Credit Transfer ( SCT Inst ), also called SEPA Instant Payment, provides for instant crediting of
3360-415: The urban subscribers is 66% and the share of the rural subscribers was 34%. In May 2011, the net monthly addition in terms of the number of subscriptions was 13.35 million. Of those, 7.33 million were from the urban segment and 6.02 million from the rural segment. The subscription growth rate on a monthly basis is 55% for urban segments and 45% for rural segments. Given this context, it is possible to consider
3420-425: The use of the secret PIN. The guidelines also specify a cap on the amount of money that can be sent during transactions. Mobile payments enable a variety of possible uses, considering that the underlying architecture is interoperable and supports payments to other peers, merchants and government offices. Mobile top-up for prepaid mobile subscribers is one of the most common mobile-related financial transactions. This
3480-460: The user to input the payee's mobile number and MMID, and the user's own MMID and PIN for authentication. Every communication channel has its own set of security mechanisms. In addition, the RBI-issued guidelines on security of mobile payments require a two-factor authentication mechanism to be employed. A two-factor authentication in this context consists of: No transaction can take place without
3540-455: The various participating entities after being ratified by the RBI . The key features of IMPS Funds Transfer are as follows: Currently IMPS service is provided to the customers over various channels including SMS, Bank Mobile Application and USSD (*99#). The transaction flow for IMPS can be simply described as 'customer-bank-bank-customer'. When a customer initiates a transaction by sending an SMS to
3600-442: Was to improve the efficiency of cross-border payments and turn the previously fragmented national markets for euro payments into a single domestic one. SEPA would enable customers to make cashless euro payments to any account located anywhere in the area, using a single bank account and a single set of payment instruments. People who have a bank account in a eurozone country can use it to receive salaries and make payments all over
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