In the last few years, customers of Standard Chartered have chaffed at their bank's inability to keep up with advances in information communication technology.

Despite the bank having modernised its processes in the late 1990s with the concept of a multinational computer network in Africa and outsourcing the processing of routine operations to regional hubs like Nairobi and Chennai, it has struggled to bring to its customers the conveniences of Internet and mobile banking, along with other big banks in Kenya.

But this is about to change as the bank rolls out an upgraded informational technology infrastructure that is likely to change the face of the financial services industry and force competitors to increase spending on business technology.

Over the last few weeks, Standard Chartered Kenya and Cellulant, a software firm, have been testing a banking software that would allow customers across the continent to among other things: check their bank balances, pay for electricity, water and other utilities and even shuffle funds between accounts through their mobile phone.

Though test marketing of the product has started in Kenya, Cellulant, which helped create this solution called Commerce 360 is already engaged in plans to expand this service across Africa.

Commerce 360 will link banks, utility services and other companies with the mobile phone owners.

"This is like an ATM in your pocket, only that there is no cash," said Cellulant CEO Ken Njoroge.

The service unlike Safaricom's money transfer system M-pesa cannot not be used to transfer money from one individual phone user to the other but can be used to make bank transactions from one account to another.

Currently, Cellulant is pitching to a number of banks and utility companies to sign up for the service and has signed deals with three banks.

While several smaller banks allow their customers to check balances through their mobile phones, Standard Chartered will be the first major bank to adopt such an initiative. This could spur others like Barclays, CFC Stanbic and KCB to follow in order to remain competitive.

If it turns out as expected, the initiative will speed up the modernization of the national payment system and most importantly help the banking system access a wider distribution system, cheaply and more efficiently by leveraging on technology in targeting Kenya's unbanked population, which is estimated at 10 million consumers.

Barely a year after Safaricom launched the M-Pesa service, Commerce 360 complements a money transfer and e-commerce offering, which if tied together and offered by a bank, has the potential of transforming the way commercial transactions are handled in Kenya.

It will however call for legislation to deal with e-commerce transactions and Internet security.

Mr Njoroge says the product will provide solution to many Kenyans who during end month have to queue for long to pay utility bills.

Other than that, for those who use errand companies, he says the solution will also help to cut cost.

While the banks normally charge between Sh15 and 40 per transaction, most of the errand companies normally charge Sh500 per cheque. In this case, if an individual has three cheques for three different bills-water, electricity and rent- and he has to use the services of an errand company, then he or she would have to pay Sh1,500 for the services. However using Commerce 360, an individual will at most be charged Sh120.

Other than paying the utility bills, individuals will also be able check their bank balance and receive account information on their handsets.

The concept is almost similar to internet banking which, however, is not widely used at personal level because of the low computer penetration and accessibility in the country.

Offering the solution on the mobile phone will make the service widely accessible. It is currently estimated that there are around 14 million mobile phone holders in the country.

Other than the banks and utility companies such as Kenya Power & Light Company and Nairobi Water, Cellulant has signed deals with both mobile subscribers, Safaricom and Celtel thus enabling subscribers from the two companies to utilize the service.

"This will change people's lives. One need not need go to the bank every month to confirm whether his or her salary has been deposited, especially in the rural areas where banks are quite a distance and people have to commute which is an extra expense to get there" says Mr Njoroge.

The solution is based on a technology called Unstructured Supplementary Service Data (USSD), a messaging function in the GSM cell phones.

Unlike text messages, USSD messages travel over GSM signalling channels and are used to query and trigger services.

Security in the solution is based on a four-digit Personal Identification Number PIN. Other than the PIN number, Mr Njoroge says the banks have also put firewall and the transactions are encrypted thus providing extra security measures.

An individual wishing to use the service only have to register with his or her bank, however the bank must have signed a deal with Cellulant.

According to Njoroge the company in future looks to hook up with other micro finance institutions in order to reach a larger market.

Other than Kenya, Cellulant which is one and half year old has subsidiaries in Uganda, Tanzania and Nigeria in which it intends take the Commerce 360 mobile banking solution if it succeeds in the Kenyan market.

While users of the service will pay a commission to their respective banks, Cellulant is going to earn income by getting a share of the commission on each transaction made to the banks using the solution.