A Secured Electronic Transaction Scheme for Mobile Banking in Bangladesh Incorporating Digital Watermarking Syed Bahauddin Alam 1 , Hussain Mohammed Dipu Kabir, Md. Nazmus Sakib, A BM Rafi Sazzad, Celia Shahnaz, Shaikh Anowarul Fattah Department of EEE Bangladesh University of Engineering and Technology (BUET) Dhaka, Bangladesh E-mail: 1 baha _ece@yahoo.com Abstract— Nowadays internet-based banking is getting popularity because of its several advantages, such as ease of operation and virtual monetary activities, i.e., client’s physical presence at different bank locations is no more required. However, because of scarcity of accessibility at different locations, cost, and slow speed, number of people using internet communication is a small percentage of the mobile phone users, especially in the developing countries. Moreover, security in internet-based banking is still a major concern. Most of the financial institutions have their own domain and offer web-based transaction facilities. In this paper, we propose a scheme to utilize the internet based existing banking facility via short message service (SMS) available in mobile phone technology without having the internet connection. In view of ensuring a high level of security, we introduce two-level security scheme: voice verification and digital watermarking. Keywords—Short message service (SMS), mobile server, bank server, internet-banking, e-transaction, speaker verification, watermarking. I. INTRODUCTION Because of widespread availability of fast internet connections, the amount of trade done electronically has grown extraordinarily. Such a techno-economic trend advocates the idea of moving towards a cashless transaction based society [1]-[2]. On the other hand, there is no doubt, still today the most versatile and popular way of communication is cellular phones [3]-[4]. The usage of banking via mobile phones is predicted to increase as the number of cellular phone users is drastically increasing. It is to be noted that the number of internet users is a very small percentage of the cellular phone users, especially in the developing countries. Hence, the e-banking facility offered by different banks is not getting actually full utilization. The abundance of cellular communication has promoted the idea of transactions using mobile phones without the need of internet connectivity at the user level [5] [6]. The SMS based mobile banking approach is very prospective one because of the low costs and bandwidth requirements, simplicity, straightforwardness and easiness involved [7]- [9]. Apart from the convenience of the consumers, security and privacy concerns always remain on the back of their minds. In the context of SMS based banking, the factors of confidentiality, integrity, and authentication needs to be integrated to ensure seamless monetary transactions . Considering SMS to be a business tool for m-commerce, an idea of using watermarking for improving mobile banking security has been proposed in [10]. Digital watermarking is an effective methodology for hiding one information (text, image, audio or video) into another. In this paper, we propose a mobile phone based framework, which uses the SMS facility as a gateway in the client’s end then get connected to the internet banking facility offered by the financial institutions via the mobile servers. The proposed scheme offers the internet baking facility to the clients without having a physical internet connection based on the collaborations between the mobile companies and the bank/financial institutions. In this regard, one financial institution can offer mobile phone banking services in collaboration with a specific telecom company or all existing mobile companies in the country or even multiple financial institutions can collaborate with the overall telecommunication sector to offer services to virtually all customers. This collaboration between financial sectors and telecom companies will be maintained through the existing GPRS or any other internet services like broadband internet access, VSAT (broadband satellite internet access) etc. whereas the end user can access the banking transaction using even his cell phone via GSM or CDMA technology. Thus the client can perform transaction from any location even when he is abroad and at the same time he can perform banking with several institutions within few minutes, which would have required a lot of times if he intends to visit all locations or institutions in person. Through the successful implementation of the scheme, the existing ___________________________________ 978-1-4244-6943-7/10/$26.00 ©2010 IEEE