As mobile carriers start to understand the importance of mobile commerce and mobile banking more and more of them are looking to get into the banking game. Google first tried implementing something along those lines with their Google Wallet system in Android phones, however, it has failed to take off due to carriers like Verizon wanting to implement their own payment systems. Everyone and their mom wants to be responsible for your mobile payments and I suspect that there we are currently in the midst of a war between the banks, mobile device manufacturers (Google and Apple) and carriers.

Right now, in the US market, the carriers effectively run the game. They tell the manufacturers what devices they want and what they want those devices to do. And the truth is that the only companies that can remotely stand up to them are Google and Apple. Everyone else must effectively bow to their demands and do as they say. I also suspect that these battles between Google and carriers (like Verizon) may be why certain Google devices (for Verizon) didn’t have Google Wallet on them in the past.

Now, getting back to T-Mobile. They are taking an entirely different approach to this mobile payments war and are instead trying to lure customers to come to them as a bank first. By having them as banking customers they can easily convert them to mobile payment customers with a simple application (and applicable EULA updates). They call this program Mobile Money by T-Mobile and what it enables is a fairly impressive feature set, which may actually result in them stealing away customers from banks in addition to competing carriers.

Mobile Money by T-Mobile which provides you a mobile app combined with a pre-paid pre-loaded T-Mobile Visa Prepaid Card that they claim offers many reduced fee, or fee free services for registered T-Mobile customers. This is clearly a way for them to help people that don’t use bank accounts to be able to have a bank account of sorts through their carrier. They also don’t charge any overdraft fees because these are pre-paid cards which means you can only spend the money that you have on your account. There are also no retail purchasing fees, no reloading fees, no monthly maintenance fees and no ATM fees when withdrawn within network. They claim that they have a network of 42,000 ATMs across the US, however there’s no clarification anywhere of exactly what ATMs these are exactly.

If you look at T-Mobile’s positioning, this is all clearly targeted towards the lower-end and lower income customers that don’t have good relationships with their current banks. This could also be an effective tool for parents to manage their children’s finances and to help them get familiar with spending money and using a mobile payment app. If anything, I suspect that this may get the most momentum from the younger demographics that haven’t yet set up banking relationships and may not see any reason to join a traditional bank to begin with.

They also want to encourage people to do their direct deposits through T-Mobile  by claiming to get people paid 2 days earlier with Mobile Money Direct Deposit. This also helps T-Mobile guarantee that certain customers will always pay their cellular bills on time if they’re banking through T-Mobile. T-Mobile will know exactly how much money their customers have and likely have some sort of clause within their contract that allows them to withdraw your wireless bill from your account if you are in default. However, by becoming a mobile banking service, T-Mobile also increases the amount of regulations put upon them and how much more security they’ll need in their websites.

Cards can be obtained through T-Mobile online at the Mobile Money site or in participating retail locations beginning in February and in Safeway (and Vons) stores in the US. The cards themselves are issued by Bankcorp, Inc. with a license from Visa, which is why these are Visa cards rather than Mastercard cards.

I believe that this is T-Mobile’s attempt to find a foothold into the mobile payments market that Verizon, AT&T and Sprint haven’t successfully managed to do. Google Wallet has for the most part failed, ISIS is virtually non-existent and generally speaking, none of these companies have the trust of their consumers to be their bank as well. After all, what are the two most hated institutions in America outside of our Goverment?

Banks and Mobile Carriers. Most people don’t hate T-Mobile, they like T-Mobile and are under the impression that T-Mobile cares about them. So, they are clearly building on this trust that they’ve gained with the consumers through their uncarrier campaigns to convince them to bank with them as well.

It’s almost like this was an entirely an evil plan to convince people to make T-Mobile their bank.