Qualcomm Inc. (QCOM) recently entered into an agreement with MetroPCS Communications Inc. (PCS), through which the latter will offer mobile banking services to its customers using Qualcomm’s mobile banking applications. Qualcomm provides mobile banking solutions through its subsidiary Firethorn Holding LLC. MetroPCS subscribers will now be able to freely download Firethorn’s mobile banking solutions from the Metro store.

Firethorn’s mobile banking platform will provide a complete picture of an individual’s personal finances on his/her mobile handset. Subscribers of MetroPCS will be able to view their bank and credit card balances and history, make transfers between their accounts, and pay their bills securely from their mobile phones using a single PIN. Furthermore, customers can also check rewards information and review targeted, timely offers from their financial institutions using Firethorn’s mobile commerce capabilities.

The acquisition of Firethorn has diversified Qualcomm into a new wireless market segment – mobile banking solutions. Mobile financial service has high growth potential. Various industry researches estimate that currently there are approximately 4 billion mobile phone users throughout the world but only around 1.6 billion individual bank accounts. This indicates that a large population of mobile phone users does not have access to basic financial services.

Firethorn’s mobile banking platform is targeting to narrow this gap combining wireless handsets and secured financial services. Citi-Card entered into an agreement with Firethorn for its real-time secured access gateway to be used by card members for account information retrieval using their wireless handsets. Four of the top ten banks in the U.S. are now Firethorn customers.

According to our assessment, Qualcomm’s entry into mobile financial service is a welcome move as this market is getting crowded gradually. NTT DoCoMo (DCM) has decided to launch an innovative on-line money transfer service in Japan. The company will extend this service globally later. Nokia Corp. (NOK) has established a business tie-up with Obopay, a global leader for developing mobile payment solutions, to launch an innovative wireless financial service called “Nokia Money”. Motorola Inc. (MOT) has also developed a new mobile phone SIM card called “I-SIM NFC Lite” card that can be used for mobile money transfer. The company is currently testing the m-wallet card in Taiwan and plans to launch it in China in the near future.

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