Key barriers of mcommerce

Awareness: mCommerce services are at a very nascent stage in India, and the awareness among the people about various services being offered over the mobile platform is very low. The onus is on the industry participants to educate the consumers about the availability of various services and the benefits offered by each of them. CRISIL Research believes that educating the consumers and inducing them to try the services will be the greatest challenge for the mCommerce industry.

Security concerns: The average Indian consumer is still sceptical to carry out transactions involving money over the mobile phone due to security concerns. This is where the role of industry regulators such as the RBI is clear. The regulators need to ensure that the services offered over the mobile platform are offered through a secure and safe channel, and the risk of fraud or money laundering is limited. The industry participants need to develop applications that enable the transactions to be carried out in a secure manner; the consumers also need to be educated about the security levels embedded in the mCommerce services.

m-Payment experience:
(1) High burden on the user – A user who might want to do five transactions perfectly designed for the mobile medium – (a) paying their mobile bill, (b) Paying their Credit Card Bill, (c) Viewing their Bank Balance, (d) Checking Flight Schedules, and (e) Booking a movie ticket – would have to learn, register, interact with, or download five different m-payment solutions.
(2) SMS platform is costly in large volume and doesn’t always provide best performance. Every transaction adds incremental, uncapped cost for the user. (A purchase may require 3-5 SMS sent by the user).

In terms of utility per single transaction, current m-payment solutions are great. In terms of utility for multiple, transactions, they need to evolve.

Heterogeneous mobile platforms: Different mobile handsets are based on different mobile operating systems or platforms; this makes designing applications for mobile phones that much more difficult. The applications have to be designed to work on maximum handsets and need to be tested on various handsets for compatibility issues. Currently, most of the mobile applications are java-based as these can be used on a majority of the handsets that are GPRS capable (Most of the handsets that are GPRS capable are also java enabled irrespective of their operating system).

Low penetration of credit cards: India is primarily a cash economy and the low penetration of credit cards in our country acts as a barrier to the growth of mCommerce services.

Perceived and Practical Value: mCommerce in India is at an embryonic stage and only a small percentage of the mobile users are even aware of availability of such services. Among consumers, though mCommerce has a low perceived value, its practical value has the highest potential among all MVAS. Subjective norms, perceived usefulness, perceived ease of use and behavioral control are strong determinants of intention to adopt mobile commerce. Studies have revealed that subjective norms and perceived behavioral control impact perceived ease of use and intention to adopt mobile commerce.