Digital Wallet? But Real!

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Celent have reviewed this profile and believe it to be accurate.
7 February 2012
KyongSun Kong
Hana Bank, well-known for being a smartphone banking pioneer in South Korea, launched a new digital wallet service called Hana N Wallet earlier this month. Hana N Wallet offers some new functionalities such as: • Convenient money transfer without account number and troublesome public certificate key which Korean regulator requires to online financial trading users in South Korea. Hana N Wallet 1 (P2P Money transfer) • Cash Withdrawal at ATM with six digits after receiving SMS when someone sends money to the other. Hana N Wallet 3 (ATM Withdrawal) Hana N Wallet is designed for use with a smartphone. When consumer A sends money to consumer B through consumer B’s phone number, consumer B receives an SMS and a “cash nut” payment into person B’s Hana N Wallet. What if person B doesn't have Hana N Wallet in her/his smartphone? Just download it through the URL in the SMS! The “cash nut” can be withdrawn at any Hana Bank ATM, without an ATM card. This is done by entering a six-digit number provided by Hana N Wallet. People can use Hana N Wallet if they don’t have a Hana Bank account. Celent thinks that this service can attract potential customers and should lead to an increase in customer count. Celent believes Hana N Wallet could bring a significant change for not only the Korean banking industry but the Korean payments market. If other banks launch similar services in the near future, the Korean digital wallet market will be more buoyed. Hana Bank will launch other new services in a couple of months. Let’s wait and see how things go…


  • This is a significant development and as KyongSun Kong has rightly said, this will open up a huge market for Payments. Come to think of it – if I want to transfer $20 to my friend, I need to go the ATM, withdraw the money and drive down to my friend’s place and hand over the cash. Or write a check, which needs to go thru the clearing and settlement process. Instead, just a press of button on my smartphone, and there you go...This innovation is going to be a major success in the P2P payments space.

    What makes Hana N Wallet appealing is the fact that the payee need not have a bank account to redeem the cash. Per Innopay's World Payment Report of Sep 2011, worldwide there are fewer than one billion bank accounts and 4 billion cell phones. Hana Bank has hit it right and has chosen the right channel to penetrate. This will immensely benefit the people that do not have bank accounts and people that do not use credit cards. For banks, this will not only increase the customer base, but also increase their revenue. Money transfers can happen without engaging the network and thus cutting down heavily on the transaction fees.

    The key challenge however is going to be the security. Though Hana N Wallet has many advantages like convenience, ease of use, etc., one of the critical success factors for consumer adoption is going to be security. As Hana N Wallet requires just the six digit pin number to be keyed in at the ATM centers, anybody who hacks into the phone, can walk away with the money. But once convinced, it’s just a matter of time and almost every smart phone user will carry this wallet.

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