Wireless applications company Macalla Software has developed a mobile banking service for a joint initiative between a Dutch bank and a mobile operator. The service is worth #2 million (£1.58 million) to the Irish company.
The mobile e-commerce solution, which combines both short message service (SMS) messaging and WAP technologies, is part of a #19-million agreement between the companies.
Macalla believes it is the largest deal in Europe within the sector and one of the first that enables European companies to share revenue generated by mobile transactions.
Under the deal, Postbank Nederland, one of the largest Dutch banks, will offer free mobiles from Dutch mobile operator Telfort to 500,000 select customers. The Siemens prepaid phones come configured with a special "hot button" that allows users to automatically top up their phone accounts by deducting amounts from their Postbank accounts.
Postbank will receive a slice of revenue for acting as a broker for the top-up facility. The bank will also be able to earn payments for additional banking transactions that utilise Telfort's network.
Telfort, one of the smaller entrants in the Dutch mobile market, will gain 500,000 new customers through the deal.
"They've come together to exploit a relative strength and a relative weakness," said Mr Niall O'Cleirigh, chief executive of Dublin-based Macalla, which employs 75 people. "The bank gets a new revenue source and the operator gets this huge upsurge in customers with this service."
Users of the service, which is being heavily advertised in the Netherlands, receive an SMS message sent by Telfort to notify customers that their pre-paid threshold has been reached. A customer can then push the phone's hot button to send an encrypted SMS message to Postbank, which requests a topup.
A sequence of secure instructions then pass back and forth between Postbank and Telfort, and the customer's phone account is credited.
The WAP end of the service offers a variety of secure banking transactions over the preconfigured phones to Postbank customers.
As Telfort is a BT subsidiary, the WAP service uses BT's Genie mobile Internet portal. The service is designed to migrate to new network technologies such as 3G in the future.
Mr O'Cleirigh said the arrangement would benefit Telfort in several ways. "When you give people handsets with these capabilities, they tend to use them more for voice as well," he said.
He said the financial services sector was a natural client for wireless services and made a good partner for mobile operators. The sector already uses electronic systems to move data and money, and was always looking for ways to gain new revenue from its large customer base, he said.
