In 2009, the Securities and Exchange Board of India had issued a draft model to enable stock trading via mobile phones. According to this draft, brokers who offered internet-based trading services could offer their clients trading via wireless technology. It might have seemed a bit optimistic at the time but now SEBI has finally announced guidelines to allow trading via mobiles using the same protocols as for internet-based share trading.
Big retail brokers like Kotak Securities, India Infoline, and Motilal Oswal Financial Services will be more than happy with this announcement by SEBI and will be eager on launching mobile-based trading services at the earliest for their existing and prospective customers.
Mobile Trading Benefits
Internet trading brought to the table a lot of advantages like Reduced Cost of Transactions, Greater Liquidity, Greater Competition, Increased Transparency, and Tighter Spreads. When it comes to trading through mobiles, it not only brings in all these benefits but at the same time adds to the list by increasing the number of traders who can trade directly through their mobile devices on the go. The mobile penetration is definitely more than that of the internet, and with the increase of smartphones in the market, mobile trading stands to go a long way compared to its internet counterpart.
Security Concerns
Security concerns will always be an issue for the common man who will be interested in trading through the mobile. Internet-based trading faced the same hindrances though SEBI had enforced unique IDs. For mobile trading, SEBI has announced that a measures should be taken for user identification, authentication and access control using means such as user-id, passwords, smart cards, biometric devices or other reliable means, to prevent misuse of facility by unauthorized persons.
SEBI allowing mobile trading only adds to all our previous discussions on how the mobile revolution is taking over our lives. Mobile trading is a great initiative and one can only hope that trades will utilize this facility to the fullest. What is your take on mobile trading?
