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Low tech widens mobile banking

– In a technology conference devoted to the slick and snappy, a small French company proudly displayed a chunky, antiquated Nokia cellphone that is allowing mobile banking to happen in places where smartphones are rarely found.

It was a message heard often during the four-day Mobile World Conference last month in Barcelona. While companies in wealthy nations struggle to get customers to pay for products with sophisticated mobile gadgets, millions of people in poorer nations are adopting the practice with clunkier cellphones as an efficient, practical alternative to cash.

In such places, the features required by many of the latest mobile payment systems, such as cameras capable of reading digitized codes, are too costly. But build a system on the things that even the most rudimentary cellphones already can do, and a massive new market potentially unfolds.

The French company, Tagattitude, transmits a unique, coded burst of sound – almost like the chirp of a digital bird – between phones to complete transactions in 20 countries. Many other mobile banking services rely on text messages to open accounts and transfer money.

“All these phones have a microphone, and all those microphones are capable of capturing data from a financial transaction,” said Yves Eonnet, the voluble chief executive of Tagattitude, showing off the clunky Nokia and several other handsets that would be at home in a museum of mobile technology history. “At the end of the day, there is no business model that is sustainable for NFC.”

Not long ago, such assertions would have been apostasy in the mobile tech world. Google and many other companies have built elaborate wallet systems around NFC, an abbreviation for “near field communication” technology. But even in the United States, adoption has been slow. The popular iPhone doesn’t have NFC. Many newer Android devices have NFC chips embedded within, but several wireless carriers have not activated them in the phones they sell.

At least 150 different companies – most of them wireless providers – offer mobile financial services for people without traditional bank accounts in emerging markets, mostly in Latin America, Asia and Africa, according to a survey released last month by GSMA, the mobile technology trade group that hosts the Mobile World Congress.