Chalk up another one to Rajiv’s Appvolution. In late September and early October, both the BSE and NSE launched their mobile trading platforms. While there was skepticism at the time, the trend shows that their acceptance is growing slowly but surely amongst traders. At least that’s what the brokers are saying.
The dichotomy between Internet and Mobile penetration in India is staggering. So it is always only a question of when -and not if- the concepts of mobile trading, mobile banking and mcommerce will overtake their internet counterparts. The biggest barrier being acceptance amongst users. While stock brokers stated that 1-3% of their trade volumes came through the platform some went on to say that a lot of their clients are increasingly using the platform to keep track of stock prices on-the-go. Geojit BNP Paribas Financial Services also stated that approximately 30-35% of their trades happen through the internet.
There are certain factors that work against the platform as well. Mr Ashish Chauhan, Deputy Chief Executive Officer of BSE said that the success of the platform depends largely on how aggressively brokerage firms push it to their clients. While some brokers pointed to the number of formalities that clients have to go through after registering, as a reason for its slower than expected uptake. And of course, where monetary transactions are involved security is a huge concern. Mobile trading platforms will have to earn traders’ trust before it becomes a ‘Weapon of Mass Transactions’.
One of the biggest reasons for the popularity of Internet Trading is the convenience it offers compared to the old paper based trading. Mobile trading has the potential to go a step further. Especially with the growing popularity of smartphones and the impending arrival of 3G services across all major telecom service providers. While brokerages like India Infoline are testing their platform. Several others like Angel Broking, Motilal Oswal Securities, Marwadi Shares & Finance, BCB Brokerage, Asika Stock Broking, Geojit BNP Paribas Financial Services, SMC Global Securities, ICICI Securities, India Infoline, Kotak Securities, Standard Chartered STCI Capital Markets already offer mobile trading facilities to their clients.
I once read a book by Nicholas Darvas about how he made $2 million on the Wall Street. A dancer and avid traveller – Darvas devised a system where his broker would send him a daily telegram with stock prices of his holdings and the scrips he was interested in. I wonder how much happier he would have been had he been able to trade with a cell phone!
While we’re on the topic of investing, another trend that is beginning to take shape is the rise of ‘Social Investing’. Not dissimilar to features I’ve seen on India Infoline’s portal where you can keep a track of fellow amateur investors who are making a killing in the markets. The important difference is that a lot of these apps are tied-in to real world transactions so you’ll have the benefit of knowing that you’re following an investor who puts his money where his mouse is! While this trend is gradually picking up in the West with many similar sites springing up, its arrival in India might just be offset by two important factors. Firstly, regulatory issues. And secondly, I’m not sure how many investors will be comfortable with making their actual net worth public knowledge.
For those of you interested in Mobile Trading – Rediff Business has a simple walkthrough that tells you what to expect
Do you think Mobile Trading will topple Internet Trading? Or even come close? Let us know!