> Click here to view the list of branches

Core Banking under CBS (Indian)

Solution > Click here to view the list of branches
under CBS (Overseas)

What is Core Banking Solution ?

Core Banking Solution (CBS) is networking of branches, which enables

Customers to operate their accounts, and avail banking services from any
branch of the Bank on CBS network, regardless of where he maintains his
account. The customer is no more the customer of a Branch. He becomes the
Bank’s Customer. Thus CBS is a step towards enhancing customer
convenience through Anywhere and Anytime Banking.

How shall CBS help Customers?

All CBS branches are inter-connected with each other. Therefore, Customers of
CBS branches can avail various banking facilities from any other CBS branch
located any where in the world. These services* are:

 To make enquiries about the balance; debit or credit entries in the

account.

 To obtain cash payment out of his account by tendering a cheque.

 To deposit a cheque for credit into his account.

 To deposit cash into the account.

 To deposit cheques / cash into account of some other person who has
account in a CBS branch.

 To get statement of account.

 To transfer funds from his account to some other account – his own or
of third party, provided both accounts are in CBS branches.

 To obtain Demand Drafts or Banker’s Cheques from any branch on

CBS – amount shall be online debited to his account.

 Customers can continue to use ATMs and other Delivery Channels,

which are also interfaced with CBS platform. Similarly, facilities like Bill
Payment, I-Bob, M-bob etc. shall also continue to be available. Bank is
in the process of launching Internet-banking facility shortly.

All these aim to provide convenient, efficient, and high quality banking
experience to the customers, comparable to world class standards.

What are other benefits to the Customers ?

A CBS branch is like a Sales & Service Delivery Center. Back office
processes/activities are handled through technology at some other site, called
Data Center. Branch, therefore, has more time for serving customers. This
improves the quality and efficiency of the services rendered and the customer is
directly benefited by way of satisfying and happy banking experience.

Since a CBS branch is essentially designed to focus on customer-interface and

customer service, the special lay-out and ambience of the branch is made to
provide a convenient and delightful banking experience. The Customer Service
Representatives / Executives at the branch are specially trained to understand,
facilitate and deliver banking services efficiently and effectively.
We wish our customers happy banking.

(*To safeguard the interest of customers, Bank has placed certain restrictions on
the amount of transactions, which are handled through other branches under
CBS. The details can be obtained from the branch).

What is Core Banking Solution?

Core Banking Solutions is new jargon frequently
used in banking circles. The advancementin
technology especially internet and information
technology has led to new way of doingbusiness
in banking. The technologies have cut down time,
working simultaneously ondifferent issues and
increased efficiency. The platform where
communication technology andinformation
technology are merged to suit core needs of
banking is known as Core BankingSolutions. Here
computer software is developed to perform core
operations of banking likerecording of
transactions, passbook maintenance, interest
calculations on loans and deposits,customer
records, balance of payments and withdrawal are
done. This software is installed atdifferent
branches of bank and then interconnected by
means of communication lines liketelephones,
satellite, internet etc. It allows the user
(customers) to operate accounts from anybranch
if it has installed core banking solutions. This new
platform has changed the waybanks are working.
Now many advanced features like regulatory
requirements and otherspecialized services like
share (stock) trading are being provided. Core
banking solutions arevery helpful to SME
industries.
Core Banking Solution (CBS) is networking of
branches, which enables customers to
operatetheir accounts, and avail banking services
from any branch of the Bank on CBS
network,regardless of where he maintains his
account. The customer is no more the customer
of aBranch. He becomes the Bank’s
Customer. Thus CBS is a step towards enhancing
customerconvenience through Anywhere and
Anytime Banking.
. The advancement in technology especially
internet and information technology has led
tonew way of doing business in banking. The
technologies have cut down time,
workingsimultaneously on different issues and
increased efficiency. The platform
wherecommunication technology and information
technology are merged to suit core needs
ofbanking is known as Core Banking Solutions.
Here computer software is developed toperform
core operations of banking like recording of
transactions, passbook maintenance,interest
calculations on loans and deposits, customer
records, balance of payments andwithdrawal are
done. This software is installed at different
branches of bank and theninterconnected by
means of communication lines like telephones,
satellite, internet etc. Itallows the user
(customers) to operate accounts from any branch
if it has installed corebanking solutions. This new
platform has changed the way banks are working.
Concepts regarding Core Banking Solutions
➢ Is the concept a novel one?
No this concept came into existence somewhere
in 1980’s but till recently it was in itsbudding
ages, but with technological advancements in all
fields this concept is also groomingand adding
more and more features to itself.
➢ Why the inception in INDIA so late?
There are many reasons for the late inception of
CBS in INDIA, some of them being

✔ Indian banks were not interested in going for

it.

✔ Required technology for adopting CBS was

absent.

✔ The competition prior globalization was not

that of present level.

➢ What are the application areas of core
banking?
Required computer software is developed to
perform core operations of banking like

✔ Balance of payments and withdrawal are

done.

✔ Mobile banking

✔ Internet banking

✔ ATM’s

✔ Recording of transactions

✔ Passbook maintenance

✔ Interest calculations on loans and deposits

✔ Customer records
This software is installed at different branches of
bank and then interconnected by means
ofcommunication lines like telephones, satellite,
internet etc. It allows the user (customers)
tooperate accounts from any branch if it has
installed core banking solutions. This
newplatform has changed the way banks are
working. Now many advanced features
likeregulatory requirements and other specialised
services like share (stock) trading are
beingprovided. Core banking solutions are very
helpful to SME industries.
➢ What all banks are using it?
Most of the nationalized banks in India for
example: State Bank of India, Punjab
NationalBank, Allahabad Bank, HDFC, ICICI Bank
today supports core banking. As of 2007,
manyCooperative banks in India such as REPCO
Bank, Jain Urban Cooperative Bank,
KangraCentral Cooperative Bank, Udaipur Urban
Cooperative Bank, Kollam District Cooperative
Bank, Kerala State Cooperative and Panchsheel
Mercantile Cooperative Bank have started to
use and offer centralized Core Banking too.
Some of the Cooperative banks and RRBs are yet
not having CBS, but they are on their wayto go
for CBS and very soon they will also be under the
roof of the umbrella of Core Banking Solution.
➢ What are the Standard Software tools?
Some of the standard software tools that many
banks are using these days are

✔ Intellect Suite from POLARIS

✔ Flexcube from iFlex Solutions

✔ Finacle from Infosys

✔ B@ncs from TATA Consultancy Services

What is the need of Core Banking Solutions?
The need for such a solution does not arise just
because of one reason or the other but it
requires a combination of driving forces to come
into existence. Some of these forces being-
•
To meet the intense competition and changing
market dynamics in an over banked
environment.
•
To meet the regulations and compliance
requirements (example in order to meet the
Basel ll norms banks must enhance there IT
infrastructure).
•
To meet the demands of customers who are
better informed, more demanding and less
loyal than ever.
•
To enhance efficiency and effectiveness.
•
Increasing customer satisfaction and convenience
•
Freeing up time for branch staff to focus on sales
and marketing
•
Simplifying process for employees
•
Enhancing bank’s competitiveness in the market
•
Improved process efficiency
Shrinking margins. Slow growth…. The challenges
that confront today’s banker are asintense as
they are varied. And technology, the banker’s
trusted friend in the past fewdecades, has lately
become an obstacle in the quest for market
leadership. Stakeholders’expectations continue to
be whetted by their positive experience in other
industries like retailand travel, of how technology
can make a difference. Satisfying such
expectations requiresthat banks make their vital
systems customer-centric, cross-channel capable,
multilingual andprocess-oriented. Not doing so in
the near term could prove to be a costly gamble.

Customer perceived value in internet

banking in Ghana
University essay from Luleå tekniska universitet/Industriell ekonomi
och samhällsvetenskap/Industrial marketing and e-commerce
AUTHOR: Abigail Naana Adams; Adnan Odartey Lamptey; [2009]
KEYWORDS: Internet banking; customer value; Ghana;
ABSTRACT: Customer perceived value has come up strongly in recent
studies as the basisof competitive advantage in the New Economy. On
another hand, internetbanking has emerged as the trend in modern
banking and a more effective model than traditional banking in
creating customer value. Against this backdrop, this study examines
customer value perceptions in internet banking in Ghana. Internet
banking providers were interviewed to ascertain the level of banking
products and services that are offered to customers. Questionnaires
were administered to customers to investigative, through a
descriptive dataanalysis, their value perceptions of the products and
services they accessfrom internet
banking.http://epubl.luth.se/cgi/epX_formFILL.cgi?
new=yes&xtype=uppsats&xlang=enThe study shows that internet
banking offered customers some level of valueand satisfaction in
terms of location and time convenience as well as costsaving but it is
also fraught with teething problems ranging from limitedinternet
access, limited service (non-transactional), occasionally slowinternet
connectivity and website downloading. Still, the customers
areenthused by the service and express expectations of improved and
advanceservices. The study concludes that banks need to promote
internet banking by having anactive stake in the development of the
internet infrastructure and offeringmore incentives to customers.
They must also match the internet technologywith robust software
and networking systems, customer-value-perception- based
strategies, benchmarking and adequate training of staff and overall
develop core competences in the face of an increasingly dynamic
indus

State Aid in the Financial Services Sector

and the Implications of the Recent
Financial Crisis
University essay from Lunds universitet/Institutionen för handelsrätt
AUTHOR: Erdal Kocoglu; [2009]
KEYWORDS: state aid; financial crisis; Financial services
sector; Juridical science; Rättsvetenskap; juridik; Law and Political
Science;
ABSTRACT: Financial services sector is fundamental to economic
growth and development in all advanced economies. Financial
services such as banking, savings and investment, insurance, and
debt and equity financing constitute a nation’s economic engine by
fulfilling three core functions in the economy. Firstly, these services
provide financial intermediation functions between savers/investors
that are looking for security and growth and consumers/businesses
who are looking for access to credit and capital. This intermediation is
vital for allocating capital to the most profitable investments,
providing a mechanism for saving, raising productivity, and
consequently, increasing competitiveness of the nation in the global
economy. Secondly, in addition to pooling investment risks, financial
services sector provides a mechanism to manage other risks
effectively and efficiently by way of insurance and increasingly
sophisticated derivatives. These tools help private citizens and
businesses cope with diverse global risks and uncertainties. Finally,
financial services sector provides the practical mechanisms for money
to be managed, transferred and received quickly and reliably. This is
an essential requirement for commercial activities to take place and
for participation in international trade and investment. Therefore, the
financial services sector is specific and can easily be distinguished
from other sectors. A serious downturn encountered in this specific
sector might have disastrous impacts on the real economy of a
nation. The current economic crisis in the United States and Europe,
marked by the ongoing weaknesses of major banks and the resulting
credit and capital crunch, highlights the critical importance of the
financial services sector in national and global economies. Considering
the importance of this sector, it is very hard for States to be
unresponsive to the calls for assistance from ailing financial
institutions. In such a situation, the States ask for a well-targeted and
organized public measures in order to safeguard financial stability and
restore economic viability. The State aid measures are perceived as
part of the solution and thus, they are generally implemented to
rescue failing firms in the financial services sector. However, Member
States in the EU should follow certain State aid rules while intervening
to this specific sector. Unfortunately, the specific nature of this sector
is not recognized in the EU until the recent banking crisis. Member
States are required to follow the same State aid rules as in other
sectors. To realize this fact, the Commission had to wait until the end
of 2008 when the financial crisis spilled into the real economy. Later
then, the Commission adopted some flexible measures for this sector
but their sufficiency is also highly doubtful. The purpose of this thesis
is to provide an overview of the State aid rules applied in financial
services sector. In the first part, two common types of State aid
measures granted in the financial services sector, rescue and
restructuring aid and State guarantees, are discussed in detail. After a
review of applicable rules in the form of guidelines and notice for
these two forms of aid measures, implications of the recent financial
crisis are discussed in the final chapter.
Brand strategy in the Swedish banking
industry : A comparative study of
Nordea and SEB
University essay from Högskolan i Jönköping/IHH, EMM
(Entrepreneurskap, Marknadsföring, Management); Högskolan i
Jönköping/IHH, EMM (Entrepreneurskap, Marknadsföring,
Management); Högskolan i Jönköping/IHH, EMM (Entrepreneurskap,
Marknadsföring, Management)
AUTHOR: Henrik Edström; Christian Algotsson; Emil Folkesson;
[2008]
KEYWORDS: brand; brand identity; positioning; Nordea; SEB;
ABSTRACT:

A brand consists of more parts than the visible features such as

names and logotypes. No matter in what industry a company is acting
the brand in itself determines if the company will succeed or not. A
successful brand is extremely hard to copy since two exactly similar
brands do not exist. With a strong brand you create positive
associations and form emotional relationships with customers.

The purpose with this paper was to investigate how banks in the
Swedish market explain their brand identity and how they use their
brand identity when positioning themselves. Furthermore the authors
have investigated the differences in that matter between two of the
leading banks in Sweden. This was done through a comparative case
study with Nordea and SEB who are two of the leading banks in the
Swedish market.

A qualitative method has been used to this thesis and in-depth

interviews have been conducted to collect information that was
suitable for our stated problem.

The results showed that both Nordea and SEB explain their brand
identity according to the different aspects that the theory states and
they understand the importance of brand identity. When building
brand identity it is important to be aware of the different parts that
the brand identity consists of. Both banks try to develop the different
parts of the brand identity but there are differences in the amount of
resources they put in each part. When positioning themselves, both
Nordea and SEB are answering the questions in the theory concerning
positioning and positioning a brand. The theory implies that the core
identities are the foundation when positioning and both Nordea and
SEB are well aware of their core identities and they are using them
when positioning their brand.
Internet Banking in Greece: Development,
Evaluation and Perspectives
University essay from Blekinge Tekniska Högskola/Sektionen för
Management (MAM)
AUTHOR: Andreas-nikolaos Papandreou; [2006]
KEYWORDS: företagsekonomi; business administration - international
business; business administration - information;business
administration - organization; internet banking; e-banking; online
banking; distribution channel; financial services;greece;
ABSTRACT: Revolutionary developments in marketing, information
and communications technology continue to transform the banking
and financial industry. Distribution of banking services through the
Internet is an important part of this transformation. The objectives of
this thesis are mainly to examine the role, which Internet banking can
play as a new distribution channel of banking services for the benefit
of both financial institutions and customers in Greece. The study
explores the growth in on-line banking services and the ways in which
financial institutions in Greece can take advantage of Internet
technology to offer successful and cost-effective banking solutions.
Moreover, this thesis addresses the key issues of concern to the
banks regarding their strategic positioning and the products/services
they offer or could offer on the Internet. Technology can help banks
build an integrated delivery strategy for effective multi-channel
management. Results identify the reasons why Greek banks use
Internet banking and their effect and place an emphasis on the
strategic impact of Internet technology as a core element of financial
services. Greek banks want to expand their existing distribution
channels using the Internet as another alternative channel. Internet
banking in Greece is on its way to become the centerpiece of direct
banking strategies.

Relationship between online service

quality and customer satisfaction: a
study in Internet banking
University essay from Luleå tekniska universitet/Industriell ekonomi
och samhällsvetenskap/Industrial marketing and e-commerce
AUTHOR: Parmita Saha; Yanni Zhao; [2005]
KEYWORDS: Internet Banking; Service Quality; Customer
Satisfaction;
ABSTRACT: In the last few years we have witnessed a substantial
growth of internet-based services, both from pure Internet businesses
and from traditional companies that are developing online services.
One of the key challenges of the Internet as a service delivery
channel is how they manage service quality, which holds a significant
importance to customer satisfaction. The purpose of this research was
to gain a better understanding of the service quality dimensions that
affect customer satisfaction in the Internet banking sector from a
consumer perspective. Based on a detailed literature review, a frame
of reference was developed. Five service quality dimensions were
selected to be tested in the Internet banking sector in order to
explore the relationship between service quality and customer
satisfaction. A qualitative research approach was used to get a better
understanding of this issue. However, a small quantitative survey was
also conducted to support the results obtained from the qualitative
study. The empirical data were gathered through in-depth interviews
with four people by using a semi-structured questionnaire and a
survey were conducted with 25 people. Data presentation and
analysis were done in accordance with the research questions and the
frame of reference. Finally, in the last chapter findings and
conclusions were drawn by answering the research questions. Nine
service quality dimensions in Internet banking were identified in this
study (i.e., efficiency, reliability, responsiveness, fulfillment, privacy,
communication, personalization, technology update, and
logistic/technical support). The quality performance of all the nine
dimensions was shown to have a strong impact on customer
satisfaction. Efficiency, reliability, responsiveness, fulfillment, privacy
was found to be the core service quality dimensions in Internet
banking. Finally, technology update and logistical or technical support
was two new dimensions found in this study.

Electronic customer relationship

management in online banking
University essay from Luleå tekniska universitet/Industriell ekonomi
och samhällsvetenskap/Industrial marketing and e-commerce
AUTHOR: Tanveer Ahmed; [2009]
KEYWORDS: E-CRM; E-CRM in banking; E-CRM in online
banking; relationship marketing; relationship management; online
banking and relationship management; online bank marketing
management; online customer management;
ABSTRACT: In online banking face to face interaction between bank
and customer is not seen. This create huge service gap for banks how
to serve and maintain customer relations in online environment. The
aim of this thesis is to investigate how banks use "Electronic
Customer Relationship Management" tool to maintain their customer
relations by using the Internet and what benefits are derived by using
this E-CRM tool and how successfully this tool is implemented in a
bank. A qualitative study was conducted comprising two cases of
banks one from Sweden and second from Denmark to get inside of E-
CRM practices. The findings indicate that banks use E-CRM mostly for
mass customization, customer profiling, self service, one to one
interaction and automatic locks in flow of financial data like security
prices which ultimately results in reduced cost of operation and
increased customer loyalty and more profits. Similarly staff training
and customer feedback is considered as backbone for successful
implementation of E-CRM strategy.

E-business adoption in the banking

industry in Ghana
University essay from Luleå tekniska universitet/Industriell ekonomi
och samhällsvetenskap/Industrial marketing and e-commerce
AUTHOR: Emma Anamuah-mensah; Georgia Marfo; [2009]
KEYWORDS: E-business; E-commerce; Ghana; Banking
Industry; Benefits; Challenges; Barriers;
ABSTRACT: This thesis is based on a case study of four banks, in
Ghana: two private and two state banks. The study only sought to
examine the adoption of e-Business in the Ghanaian banking industry
with respect to the expected benefits derived by adopting e-business,
the barriers that prevent firms from taking advantage of e-business
adoption and the challenges firms encounter when adopting e-
business. The study idea was conceived on the premise that
businesses are always looking for ways of improving their products
and services deliveries and will thus be useful to understand how the
adoption of e- Business can benefit the banking industries in Ghana
that is seen to be in the fore-front of national development. The
researchers also wanted to understand how electronic commerce as a
new way of doing business can be introduced effectively in the
Ghanaian banking business especially with the understanding that E-
business involves the fundamental reengineering of business model
into a internet based networked enterprise. The result of the study
indicated that the benefits of e-business are well known to the banks
and represent a formidable force to drive the adoption by many banks
in Ghana. The benefits of e-business are experienced whether or not
the bank is state or private. The various areas where the banks are
preparing to use e-business approach includes familiar and relatively
mature electronically-based products in developing markets, such as
telephone banking, credit cards, ATMs, and direct deposit. This means
that most of the banks have recognized the need to change their
business process to conform to changing business trends in order to
keep up with competition. Despite the perceived and experienced
benefits of e-business in Ghanaian banking, they also identified
several barriers and challenges that could be described as: economic:
technical and technological: ethical and institutional: and socio-
cultural. The results also revealed that the banks consider technology
as the most important challenge to the effective adoption of e-service
in the banking industry in Ghana. The study provides some
recommendations towards improving e-business adoption in Ghanaian
banks.

Factors influencing the adoption of

Internet banking
University essay from Luleå tekniska universitet/Industriell ekonomi
och samhällsvetenskap/Industrial marketing and e-commerce
AUTHOR: Sara Naimi Baraghani; [2008]
KEYWORDS: Electronic Banking Ebanking ; Internet
Banking; Information Technology IT ; Technology Adoption; Trust;
ABSTRACT: This thesis reports the findings of a study issues
concerning the adoption of internet banking in Iran. This study
investigates costumers' adoption within the context of Iran Internet
Banking services and research framework is based on the extension
of Technology Acceptance Model with Theory of Planned behavior and
Trust.Theory was developed to identify factors that would influence
the adoption of Internet banking. The framework includes Attitude,
subjective norm, Perceived behavioral control, Perceived usefulness,
Perceived ease of use, Trust and intention constructs. Survey was
conducted to gather the data. Partial Least Square was used to
examine the entire pattern of inter-correlations among the thirteen
proposed constructs and to test related propositions empirically.
Results show that Attitude, Perceived behavioral control, Perceived
usefulness, Perceived ease of use, Trust significantly influence
customers' intention toward adopting Internet banking. Theoretical
contributions and practical implications of the findings are discussed
and suggestions for future research are presented.

http://epubl.ltu.se/1653-0187/2008/099/LTU-PB-EX-08099-
SE.pdf
Benefits of e-CRM for banks and their
customers: case studies of two
Swedish banks
University essay from Luleå tekniska universitet/Industriell ekonomi
och samhällsvetenskap/Industrial marketing and e-commerce
AUTHOR: Srinivas Anumala; Bollampally Kishore Kumar Reddy;
[2007]
KEYWORDS: -;
ABSTRACT: The customer relationship management (CRM) is
essential and vital function of customer oriented marketing. Its
functions include gathering and accumulating customer-related
information in order to provide effective services. e-CRM is a
combination of IT sector but also the key strategy to electronic
commerce. e-CRM is a combination of software, hardware, application
and management commitment. Aim of e-CRM system is to improve
customer service, develop a relationship and retain valuable
customers. e-CRM is a concern for many organizations especially
banking sector. The purpose of this study is to gain a better
understanding of the benefits e-CRM to customers and organization in
banking industry. To justify the purpose two research questions have
been addressed and on the basis literature review, a frame of
reference was developed which helped us to answer the research
questions and collect data. A qualitative research approach was used
for this study. Empirical data was collected through in-depth
interviews were conducted with two Swedish banks and a group of
their customers. In the last chapter findings and conclusions were
drawn on the basis on research questions. Our findings indicate that
Swedish banks are well aware of the benefits and applications of the
e-CRM and use the system to maintain good relationships with their
customers. Our findings also indicate that with the implementation of
e-CRM and the latest technologies. We have found that both the
banks seem to have same description about the benefits of e-CRM.
We found that both banks have maintained good relationships with
customers due to the usage of e-CRM. Our finding indicates that with
the implementation of e-CRM and the latest technologies banks have
ensured full security for the transactions of their customer's. e-CRM
facilitates the organizations to provide one to one services and also
maintain the transaction security of the customers.

Credit card security and e-payment:

enquiry into credit card fraud in e-
payment
University essay from Luleå tekniska universitet/Industriell ekonomi
och samhällsvetenskap/Information Systems Sciences
AUTHOR: Jithendra Dara; Laxman Gundemoni; [2006]
KEYWORDS: Electronic Payment; Credit Cards; Counterfeit fraud;
ABSTRACT: The emergence of electronic commerce has brought in its
wake some major security concerns. Electronic Payment has
dominated and attracted much attention in recent times as all major
stakeholders, thus payment operators, electronic card manufacturers
as well as and cardholders continue to seek for effective means of
combating the threats of internet frauds and more especially credit
card frauds. Of the security issues facing banks everywhere,
prevention of credit cards frauds has always been a high priorityCredit
card frauds come in several ways. The most prevalent and commonly
known type is counterfeit card fraud. Counterfeit fraud has now been
overtaken as the most costly type of card fraud by a newer method,
that of Cardholder-Not-Present (CNP) fraud which accounts for higher
percentage of frauds in electronic payment in most developed
countries. However, as new banking channels have opened up, for
example internet, phone banking and e-commerce, and the boom in
credit card use, crime has migrated to seek any opportunity to attack
these new and immature transaction methods. Our study is an
attempt to delve a little further into the issue of credit card frauds by
exploring the processes involved and pursued by two financial
institutions in Sweden and India, focusing on the four key processes
identified by Buttfago and Dyxler.

Mobile Financial Services : Opportunities

in Electronic Banking from Wireless
Computing Technology
University essay from Högskolan i Jönköping/Internationella
Handelshögskolan; Högskolan i Jönköping/IHH, Företagsekonomi;
Högskolan i Jönköping/IHH, Företagsekonomi
AUTHOR: Anders Gustafsson; Mattias Wramsmyr; Mikaela Claesson;
[2005]
KEYWORDS: Electronic commerce; mobile commerce; electronic
banking; mobile banking;
ABSTRACT:

Bankindustrin är ett typiskt exempel på en industri som har tjänat

otroligt mycket på information- och
kommunikationsteknologiapplikationer. Dessa applikationer tar
formen av Internet-baserad banktjänst, som inkluderar transaktioner
av värdepapper, kontouppgifter, presentation av räkningar och
betalningar samt transfereringar mellan konton och individer.

Mobila banktjänster är den naturliga förlängningen av dessa typer av

tjänster. Med utvecklingen av digitala trådlösa teknologier, som
mobiltelefonen, är mobil Internettillgänglighet nu förverkligad.

Denna uppsats undersöker den förändrande miljön i finansindustrin

som uppkommit till följd av informationteknologier, och vidare de
strategiska affärsmässiga överväganden som måste göras inom detta
område.

En kvalitativ fallstudie ansågs vara den mest givande metoden att

använda i vår forskning. Genom att undersöka marknade, genom att
skicka ut en väl strukturerad enkät till tre av de största svenska
bankerna (Nordea, SEB och Handelsbanken), med relevanta
intervjufrågor angående deras involvering i mobila banktjänster,
kunde deras potential avgöras. Intervjuerna utfördes sedan via
telefon.

Vi drar slutsatsen att för att bli konkurrenskraftig i dagens värld av

avancerade teknologier, är det avgörande att finansiella instutitioner
positionerar sig genom att använda sig av sådana applikationer.
Banker har de nödvändiga kapitaltillgångarna som krävs för att göra
betydande investeringar i teknologisk infrastruktur. Om de inte hade
anpassat sig till teknologier som bankomater, kreditkort, telefoner
och Internet, skulle de lätt ha kunnat exkluderas från marknaden. Det
är troligt att mobila banktjänster kommer att ha samma inverkan.

Electronic Retail Payment Systems: User

Acceptability & Payment Problems
University essay from Blekinge Tekniska Högskola/Sektionen för
Management (MAM)
AUTHOR: Alexander Appiah; Fred Agyemang; [2004]
KEYWORDS: företagsekonomi; business administration -
marketing; electronic payment systems; payment mechanisms
instruments; retail payments; electronic retail
payments; atm; payment problems;
ABSTRACT: ELECTRONIC RETAIL PAYMENT SYSTEMS: USER
ACCEPTABILITY AND PAYMENT PROBLEMS IN GHANA The payment
system in Ghana has undergone considerable change as electronic
payment has gained increasingly popularity, especially in the cities. In
Ghana, most bills are paid by walk-in customers. Because of limited
transportation, many customers prefer paying by other means that
may not include traveling. Customers are now looking for a way that
they can easily make payments without going to each biller’s location,
purchase money orders, and no loss of time. This thesis looks into
issues in payment problems and user acceptance. Payment for goods
and services in Ghana is characterized by long queues, long distance
traveling and time wasting that negatively affect business activities
and ultimately economic development. Settling utility bills, payment
for goods and services, and money transfers has been a major
headache for individuals and firms in Ghana resulting in declined
business activities and huge debt to most of the utility services
providers. Indeed, most Ghanaians are yet to fully realize the benefits
of the technological advances made in banking services like
networking of business branches, electronic transfers and use of
automated teller machines. The few payment mechanisms that are
available are not being well patronized by bank’s customers. The
purpose of the study is to assess the issue of user acceptance in the
existing electronic retail payments and also to ascertain the impact in
solving some of the problems in retail payment for goods and services
in Ghana. The research also describes and briefly analyses recent and
potential future trends in electronic payments in Ghana, and the
challenges faced by participants in this business. It is also in response
to the growing need in Ghana to develop non-cash payment products
and clearing systems in order to reduce the over- dependence on
cash payments. In analyzing the electronic payments, we restricted
ourselves to business to consumer (B2C) segment. The research
questions for our study are: Can electronic payment system replace
existing payment systems and solve payment problems? How are
customer attitudes about electronic payments changing? What are the
impediments to market development and innovation in electronic
payments? This study used primary sources in a form of "consumer
survey" questionnaire in obtaining the perceptions of bank customers
(mostly individual customers) and interviews of bank’s staffs. An
extensive review of the available literature provided the foundations
for the writing of the thesis. The study collected data from secondary
sources such as the Internet, articles, databases, and books, and
were analyzed and interpreted. In the rare situations when official
statistics are available, the recentness of the data determined its
usefulness. It is universally agreed that a safe and efficient national
payment system is essential for sound banking. The benefits derived
from electronic payment cannot be over emphasized. Numerous
studies have shown that electronic payment brings many benefits to
users – convenience, security, record-keeping, low cost, and etc. Our
study shows that electronic payment systems have the potential to
eliminate if not reduce the problems consumer face in the payment
and settlement system. The study also revealed that consumers are
ready to embrace the new payment systems – electronic payment,
provided other well anticipated side benefits are promoted to them.
Integrated Security by using MPLS-VPN
for Retail-Banking Network : Case
study Mehr bank, Iran
University essay from Högskolan Halmstad/Sektionen för
Informationsvetenskap, Data– och Elektroteknik (IDE); Högskolan
Halmstad/Sektionen för Informationsvetenskap, Data– och
Elektroteknik (IDE)
AUTHOR: Sara H.daryani; Pouria Taslimi; [2010]
KEYWORDS: MPLS; Security; Integrated; IP base; IP enable; Physical
security; Bank;
ABSTRACT:

The studied application area is a private bank with different branches

located in different provinces around the country. There was not
integrated security solution to provide communication among
different branches. Some of these branches could communicate
through the satellite and the others could communicate through a
different technology, such as asynchronous transfer mode (ATM).

Different bank security policies were applied and maintained for

different branches separately. In addition, the number of branches is
expected to grow during coming year in each province.

The old topology was partial mesh and it could not support enough
redundancy in case of disruption. If a connection between two
branches failed, other branches might lose their connectivity as well.
In addition, it could not achieve optimum routing.

Providing integrated quality of service (QoS) for the wide area

network (WAN) by using different technologies is not easy to achieve,
and it causes so many problems for the system. The bank uses a
variety of protocols for different applications, depending on its
demand, so the new applied technology should not depend on
protocols, or at least should support different protocols at a same
time. In the old technology, the bank was responsible for granting
availability and connectivity maintenance. Providing proper bandwidth
is an important aspect in the bank scenario and for the old
technology; supplying enough bandwidth was costly.

As mentioned above, the old applied technology was dependent upon

different protocols. Therefore, packets in different open system
interconnection layers (OSI layers) would have to check thoroughly to
find the source/ destination address, data and so on, to reach the
correct destination. This might cause security problems for entire
system. In addition, processing packet in each layer of the OSI model
is time consuming.
One important aspect for the retail-banking scenario is considering all
features of the security domain, such as security policy, information
security, physical security, access level control, integrated security for
the system and so on. Some features of the security domain in this
project were not covering completely, such as integrated information
security, merged security policy, and integrated physical security for
the system.

In this project, all mentioned problems are solved by implementing a

specific communication technology which can overcome the problems
above. This technology supports multiple protocols, and it provides
fast and secure communication. It can also cover redundancy and it
does not cost as much as previous technologies like ATM and satellite.
Easy provisioning is one feature of this technology. In this technology,
the service provider is responsible for granting availability and
connectivity maintenance.

The mentioned features of the security domain, which were not

covered by the old technology, will be covered by a proper, integrated
security solution. The IP-based physical security systems provide
centralized monitoring and they can define a merged security policy
for all different branches around the country. Specific, pre-defined
scenarios are created for different events in different situations.

Two Way Mobile Authentication System

University essay from Blekinge Tekniska Högskola/COM
AUTHOR: Karthik Mandava; Harish Dinne; [2010]
KEYWORDS: telekommunikation; telecommunications; two factor
authentication; one time password otp ; demo online banking
application; computer security; mobile device for authentication;
ABSTRACT: The ever increasing use of internet around the world has
without doubt increased the usage of internet based services, e-
business models, easier ways of communication and information
sharing. Such drastic increase in usage of network based systems has
made the current cyber security systems old dated as the hackers
and attackers of networked systems is on the rise with new and
modern attack methodologies. This has necessitated the need of more
secure ways of communications. The issues of Confidentiality,
Integrity and the Availability of systems are of prime importance and
more research towards these issues has been called for around the
world. One of the major areas of security improvement is the way in
which authentication of users is carried out. Even though many
organizations still rely on static ID and password authentication
system, this method is getting old and there is a requirement for a
better way of authentication which is required. One of the solutions
for this issue is the two factor authentication technique as a
fundamental security function. Our thesis proposal explores the two
factor authentication technique and implementation issues which can
be used for the two factor authentication technique. Two-factor
authentication method is implemented in two main phases. In the
first phase, the authenticator gets a request generated by the
application to authenticate a specified user. When the request is
received, it generates a one-time password and sends it through a
SMS to a GSM cell phone registered for that specified user. The one-
time password has a default timeout 5 minutes which is configurable.
In the second phase of the authentication, a request is sent with the
user id and a hash of the one-time password. If both the one-time
and user specified password is valid then the user will be
authenticated. [1] It proposes a secure, convenient and user friendly
two factor authentication scheme and discusses its applications to
online banking.

Internationalization of banks : The

consumer perspective
University essay from Högskolan i Jönköping/Högskolan i
Jönköping/IHH, EMM (Entrepreneurskap, Marknadsföring,
Management)Internationella Handelshögskolan; Högskolan i
Jönköping/Högskolan i Jönköping/Internationella
HandelshögskolanIHH, EMM (Entrepreneurskap, Marknadsföring, Ma
AUTHOR: Kristina Olsson; Tsolmon Gankhuyag; [2008]
KEYWORDS: Worldmindedness;
ABSTRACT:

Increased deregulation, cross-border activities of non-financial

companies and improved information communications technology led
to an increased consolidation of financial institutions across borders.
Commercial banking sector in particular, have witnessed trenmendous
amount of cross-border bank merger and acquisitions’ (M&As) deals
through out the recent years.

The reasons behind cross-border bank M&As are examined from

different theoritical perspectives, such as a mode of entry into a
foreign market, as a value-creating strategy and/or way of
maximizing shareholder value either by achieving efficiency gains or
by increasing the market power. It is not entirely clear however if any
of these motives take into account the consumer perspective on the
subject matter; in fact it seems that consumer perspectives or
attitudes towards the increasingly globalized banking sector has been
left out of discussion. Furthermore, while globalization has accelerated
cross-border merger activities around the world, another global force
recently has been creating a counterweight to cross-border deals.
Concerns over nationalism, feelings of national security and
protectionism have delayed several cross-border banking deals.
The purpose of this study is therefore to explore the Swedish
consumer attitudes on the issue of internationalization of banks.
Through literature studies we have identified relevant threories of
consumer perspectives on the general concept of globalization; the
consumer nationalism and consumer worldmindedness. Based on the
previously developed scale of these two opposing concepts, the study
measures the consumer attitudes towards the subject matter by
examining to what extent they accept the highly globalized world and
more importantly, greatly internationalized banking sector. The study
took a quantitive approach where the survey was handed out to the
general public in Jönköping in order to apply our researched theories
and to see for an association between their general attitude on
globalization and their specific attitude towards internationalization of
banking sector.

The result showed the average consumer has a nationalistic attitude

towards internationalization of banks. Thus we can argue that
although the future seems to bring us an increasingly globalized
financial market, the nationalistic or protectionist attitude may always
exist at some level within the individual consumer. It is hard to
predict how broad or influential the impact of this ‘attitude’ would be,
yet it is certain that this will be a never-ending counterforce to the
globalized banking sector we are looking at in the future. Foreign
banks who are merging with or acquiring Swedish banks therefore
should focus not only on the gains that they will achieve from
entering Sweden, but also how these gains can be transferred as a
benefits to consumers or government of the country to manage
challenges related to consumer nationalism.

Remote People Management - Resolving

Organizational Issues at Call Centers:
Case Study of the Bank of Nova Scotia
University essay from Blekinge Tekniska Högskola/Sektionen för
Management (MAM)
AUTHOR: Elena Maslova; [2008]
KEYWORDS: företagsekonomi; business administration -
organization; business administration - management control;business
administration - information; assimilation; call center; information
technology; innovations; remote people management; turnover;
ABSTRACT: Transformation of management coincided with rise of IT
and re-orientation towards the demand driven economy. IT facilitated
the development of remote communication and data accessibility,
while re-profiling the management methods, in meanwhile, customer
focus has led to organization of customer-oriented establishments
such as call centers. However, aside from benefits, including
accessibility, convenience, and long term cost reductions,
implementation of innovations in information technologies has yielded
issues. Complete assimilation of technology proved to be difficult due
to factors emerging from technological, organizational and
environmental contexts. Namely, factors that are most applicable in
the call center context are technology readiness and managerial
obstacles. Another issue that had risen as a consequence of wide
spread use of IT in the call center context is employee turnover.
Although not directly linked to turnover per se, IT assisted in
transformation of management methods, which, uncompensated,
exert pressure onto employees, while often remaining unseen. Since
pressure in addition to contributing factors is linked to stress, one
suggests that stress is the leading cause of turnover at call centers.
Accordingly, pressure to perform, along with applied control methods
will be examined in this thesis. Thesis proceeds to investigate
background information on these issues, followed by review of the
relevant academic work, concluding with the case study in the
banking sector aiming to look at specific issues in order to find
practical solutions. Finally, a summary will indicate the proposed
direction for issue resolution.

Online banking access system :

Principles behind choices and further
development, seen from a managerial
perspective
University essay from Högskolan i Jönköping/IHH, Informatik;
Högskolan i Jönköping/IHH, Informatik; Högskolan i Jönköping/IHH,
Informatik
AUTHOR: Sofia Li; Patrik Ekberg; Gentiana Morina; [2007]
KEYWORDS: online banking; internet banking; ebanking; online
banking access system;
ABSTRACT:

Online banking is a young way for banks to reach new and old
customers. The concept has emerged over the last decade from being
not very utilized to become a major channel for the bigger banks in
Sweden but also in the world. This thesis will present a study of what
principles the four major Swedish banks have based their decision on
when choosing what type of online access system to use. Furthermore
try to present what the future principles might be toward online
banking access systems. This might also show how new systems
might look like and what the banks strives to achieve when making
these systems not only safer but more available and usable. The
thesis will present what authentication is and how the authentication
process is used today. Today in general what is used is the two factor
au-thentication which is based upon passwords. This two factor
authentication makes it hard for attackers to breach the systems in
use today, but there are ways which are emerging to gain access.
Such an emerging threat is the SSL-evading Trojans. Still these kinds
of threats are not common at all but they need to be considered.
Today passwords are the only means we can use to make the
authentication processes safe but they are not enough, according to
Bill Gates. Therefore we have looked at new ways to complement
today’s password based authentication processes; such compliments
might be the use of biometrics, which seems to be an emerging
technology.

This study have been a challenge from the beginning since we knew
that this is a very in-tense subject for the banks to discuss and
therefore we have had to be persuasive in many cases and let the
banks answer anonymously to be able to gather as much information
as possible from our sample banks. Furthermore we have collected up
to date articles and studies to be able to get as accurate information
as possible.

The main findings we have discovered is the trade-off between

security versus availability and flexibility and these factors were the
same no matter what online access system, PDA or smart card, they
have in use. But also that all the banks states that their
authentication process is very safe and striving to become 100%
secure, even though we have found new threats which is not of an
authentication problem but a matter of transactional problem. The
banks have shown through the interviews that they lack awareness of
such a threat.

Adoption Issues of Internet Banking in

Pakistani' Firms
University essay from Luleå tekniska universitet/Industriell ekonomi
och samhällsvetenskap/Information Systems Sciences
AUTHOR: Saadullah Khan; [2007]
KEYWORDS: Internet Banking; Trust of the
System; Security; Reliability; Risk; Response
Time; Privacy; Firms; Pakistan;
ABSTRACT: In the world of banking, the development in information
technology has an enormous effect on development of more flexible
payment methods and more-user friendly banking services. Electronic
banking services are new, and the development and diffusion of these
technologies by financial institutions is expected to result in a more
efficient banking system. This technology offers institutions
alternative or non-traditional delivery channels through which banking
products and services can be delivered to customers more
conveniently and economically without diminishing the existing
services level. In recent years, almost one fourth Pakistani's banks
have started to offer Internet banking services to their customers.
The purpose of this research was to explore and analyze the issues
that influence Pakistani's firms' intentions toward Internet banking
services adoptions. Based on a detailed literature review, a research
model was developed. Five sub issues were selected from system
trust area in order to gain a better understanding of Internet banking
service quality and customer thoughts about these services. A
qualitative research approach was used to get a better understanding
of theses issues. The empirical data were collected from three
different Pakistani's firms by using questionnaires and consulting
case-studies. Data analyses were done in accordance with the
research questions and research model. The findings from respondent
data show that they have greater level of worry regarding trust, and
they do not have confidence to make any big financial transactions
over internet, and have no satisfaction from Internet banking
services. Thus lack of system security concerns as the prime reasons
for slow adoption of Internet banking in Pakistani firms. Finally the
results from respondents' data and conclusions were drawn by
answering the research questions.

Prediction of customers' attitudes toward

using internet banking in Iran
University essay from Luleå tekniska universitet/Industriell ekonomi
och samhällsvetenskap/Industrial marketing and e-commerce
AUTHOR: Mojdeh Ghezelayagh; [2007]
KEYWORDS: e-Commerce; Banking; Iranian banks; International
services; Internet banking; Attitudes;
ABSTRACT: Banking, one of the most information intensive sectors, is
an ideal domain for the successful development of e-commerce. The
present study focuses on e-commerce opportunities for improving
customer services in the Iran banking sector. First part of this study
reports on a survey of 31 top marketing and IT managers from three
major Iranian governmental banks. The results indicate that the
potential of e-commerce ranges from simple applications, such as
giving information about services, to more sophisticated ones that
involve customers in services design and customization. Suitable
management actions are proposed to Iranian banks in order to fully
benefit from the Internet. At present, one of the key challenges of the
Internet as a service delivery channel is how banks manage service
quality, which holds a significant importance to customer satisfaction.
On the other hand, in this new era of cyberservice, marketing
managers must reappraise their approach to marketing services in
general and international services in particular. In the meantime, in
the second part of this report, a large quantitative survey with
customers has been conducted by testing and analysing the attributes
which involve for customer attitudes toward using Internet banking.
Based on a detailed literature review and frame of reference, a
conceptual model of the adoption process for self-service technologies
is developed and tested across Internet banking technology used in
the banking industry. The Internet banking technology is relatively
new to the Iran marketplace. Data were collected using a survey of
234 banking customers in a one-state area (Tehran) and analyzed
using path analysis modeling. The results of the model tests on this
technology provides evidence that different factors including: Ease of
Use, Usefulness, Need for interaction, Risk and Cost with different
degree of intensity influence attitudes toward using Internet banking
and offers an explanation of the varying degrees of acceptance found
among different type of customers. This research has demonstrated
that multiple factors need to be considered when introducing new
technology into the service encounter and that the salient factors may
vary and their stages in the adoption process.

Internet Banking in Greece: Development,

Evaluation and Perspectives
University essay from Blekinge Tekniska Högskola/Sektionen för
Management (MAM)
AUTHOR: Andreas-nikolaos Papandreou; [2006]
KEYWORDS: företagsekonomi; business administration - international
business; business administration - information;business
administration - organization; internet banking; e-banking; online
banking; distribution channel; financial services;greece;
ABSTRACT: Revolutionary developments in marketing, information
and communications technology continue to transform the banking
and financial industry. Distribution of banking services through the
Internet is an important part of this transformation. The objectives of
this thesis are mainly to examine the role, which Internet banking can
play as a new distribution channel of banking services for the benefit
of both financial institutions and customers in Greece. The study
explores the growth in on-line banking services and the ways in which
financial institutions in Greece can take advantage of Internet
technology to offer successful and cost-effective banking solutions.
Moreover, this thesis addresses the key issues of concern to the
banks regarding their strategic positioning and the products/services
they offer or could offer on the Internet. Technology can help banks
build an integrated delivery strategy for effective multi-channel
management. Results identify the reasons why Greek banks use
Internet banking and their effect and place an emphasis on the
strategic impact of Internet technology as a core element of financial
services. Greek banks want to expand their existing distribution
channels using the Internet as another alternative channel. Internet
banking in Greece is on its way to become the centerpiece of direct
banking strategies.

Mobile Financial Services : Opportunities

in Electronic Banking from Wireless
Computing Technology
University essay from Högskolan i Jönköping/Internationella
Handelshögskolan; Högskolan i Jönköping/IHH, Företagsekonomi;
Högskolan i Jönköping/IHH, Företagsekonomi
AUTHOR: Anders Gustafsson; Mattias Wramsmyr; Mikaela Claesson;
[2005]
KEYWORDS: Electronic commerce; mobile commerce; electronic
banking; mobile banking;
ABSTRACT:

Bankindustrin är ett typiskt exempel på en industri som har tjänat

otroligt mycket på information- och
kommunikationsteknologiapplikationer. Dessa applikationer tar
formen av Internet-baserad banktjänst, som inkluderar transaktioner
av värdepapper, kontouppgifter, presentation av räkningar och
betalningar samt transfereringar mellan konton och individer.

Mobila banktjänster är den naturliga förlängningen av dessa typer av

tjänster. Med utvecklingen av digitala trådlösa teknologier, som
mobiltelefonen, är mobil Internettillgänglighet nu förverkligad.

Denna uppsats undersöker den förändrande miljön i finansindustrin

som uppkommit till följd av informationteknologier, och vidare de
strategiska affärsmässiga överväganden som måste göras inom detta
område.

En kvalitativ fallstudie ansågs vara den mest givande metoden att

använda i vår forskning. Genom att undersöka marknade, genom att
skicka ut en väl strukturerad enkät till tre av de största svenska
bankerna (Nordea, SEB och Handelsbanken), med relevanta
intervjufrågor angående deras involvering i mobila banktjänster,
kunde deras potential avgöras. Intervjuerna utfördes sedan via
telefon.
Vi drar slutsatsen att för att bli konkurrenskraftig i dagens värld av
avancerade teknologier, är det avgörande att finansiella instutitioner
positionerar sig genom att använda sig av sådana applikationer.
Banker har de nödvändiga kapitaltillgångarna som krävs för att göra
betydande investeringar i teknologisk infrastruktur. Om de inte hade
anpassat sig till teknologier som bankomater, kreditkort, telefoner
och Internet, skulle de lätt ha kunnat exkluderas från marknaden. Det
är troligt att mobila banktjänster kommer att ha samma inverkan.

Financial Development and Economic

Growth: The Case of Chinese Banking
Sector
University essay from Lunds universitet/Nationalekonomiska
institutionen
AUTHOR: Katarzyna Burzynska; [2009]
KEYWORDS: China; economic growth; Granger Causality; Financial
Development; Banking Sector; Economics; econometrics;economic
theory; economic systems; economic
policy; Nationalekonomi; ekonometri; ekonomisk teori; ekonomiska
system;ekonomisk politik; Business and Economics;
ABSTRACT: China’s economy has developed rapidly since the
introduction of market reforms in 1978. In parallel came the reforms
within the financial sector and the most of financial intermediation
between savings and investment has been channelled through the
banking sector. Thus far studies on the finance-growth nexus in China
have focused on the financial sector as a whole. This thesis aims to
determine the impact of different banking institutions on economic
growth and assess the compatibility of state financial policies with
country’s economic performance. The empirical analysis is performed
using annual data for the period 1978 to 2005. Using the Granger-
causality test procedure under vector autoregressive model I examine
the relationship between economic growth and, respectively, different
types of banks and different types of loans. The procedure provides
evidence that presence and direction of causality is affected by the
type of bank as well as type of loan. There is two-way causality
between economic growth and policy banks as well as rural credit
cooperatives. The development of state-owned commercial banks and
other commercial banks merely follows economic growth.
Furthermore, loans to construction sector Granger cause growth and
there is a one-way causality between growth and loans to commercial
sector. The fact that policy banks manage to positively influence
China’s development might indicate that state policies concerning
financial sector and economic growth are successful. However to
sustain the growth it is important to further develop financial services,
ensure better credit allocation and improve access to financing for
private as well as small and medium-sized enterprises.

Impact of E-Banking on the Banking Industry

An in-depth analysis of individual commercial banks and how
they service their customers.
13,765 words (approx. 55.1 pages), 31 sources, APA, 2006,
$ 249.95
Dissertation or Thesis # 75499 | details |
Add to cart (you can always remove it later)

Abstract
This paper discusses individual commercial banks and how they
service their customers. It analyzes the quality
of banking services that a customer gets and how the services
are provided to the customer. It describes the three main
channels for banking today - through branches, through the
internet and on telephone.

Table of Contents:
Introduction
Chapter I
How Internet Banking Has Grown In The Last Decades,
Especially Regarding New Product Being Offered
Evolution of Internet Banking
Present Status and Profile of E-Banking Offered By Banks
Nature of Product Offered
Chapter II
The Operations of Banks In Different Areas: What Is The
Contribution?
Effects of E-Banking on Banking Operations: What Is The
Contribution of Internet Banking Toward The Business?
Chapter III
General Benefits of Banks From E-Business and Other
Communication
Performance Measurement
Chapter IV
Reality of System Risks and Control
Conclusion

From the Paper

"To understand the relationship that can develop between the
Internet and banks, one has to first understand the nature of both
these items. The first to be understood is the banks. So far as
banks are concerned, at the beginning of the twenty-first century,
central banking which is the source of all banking activity would
appear to be at a crossroads in their future. Earlier it was the
lender of last resort, active participant in stabilizing economic
fluctuations, and now the present main function is being the
guardian of price stability. As it is still the monetary authority,
much is expected from them. At one stage, fiscal policy was
considered to be the main instrument of economic policy, the
situation changed to an ascendancy of monetary policy and that
was noted by the late 1980s in most parts of the industrialized
world. This had a lot of implications for the role of the central
bank."

Online Banking in Britain

A discussion of online banking in Britain, its problems as well as
its advantages and security.
1,881 words (approx. 7.5 pages), 10 sources, MLA, 2000, $ 60.95
Essay # 11133 | details |
Add to cart (you can always remove it later)

Abstract
This paper is a personal research project about online banking in
the United Kingdom. It describes its history, how it works,
security issues and its advantages and it introduces
online banking facilities. It provides an appendix summarizing
the services of each of the main British banks.

Table of Contents
What is online banking?
How online banking works
The security of online banking
The advantages of online banking
The disadvantages of online banking
Prediction of the prospects of online banking.
From the Paper
"The online banking will be a step to a new stage in the future. By
that time, the banks will definitely offering more attractive
services online and the competition of online banking will be
complicated because more banks will have online banking
services. Another progression is the development of wireless
banking such as Digital TV and Mobile banking or so called WAP
(Wireless Application Protocol). Nowadays, mobile phones are
used everywhere, and many leading telecom companies and
software companies have joined the WAP forum. Such as Nokia,
Ericsson and Motorola."

Future of Banking in India – Changing Imperatives

Uploaded by tanujadunga (76) on Nov 28, 2006

EXECUTIVE SUMMARY

A healthy banking system is essential for any economy striving to achieve good growth
and yet remain stable in an increasingly global business environment. The Indian banking
system has witnessed a series of reforms in the past, like deregulation of interest rates,
dilution of government stake in PSBs, and increased participation of private sector banks.
It has also undergone rapid changes, reflecting a number of underlying developments.
This trend has created new competitive threats as well as new opportunities. This paper
aims to foresee major future banking trends, based on these past and current movements
in the market.

Given the competitive market, banking will (and to a great extent already has) become a
process of choice and convenience. The future of banking would be in terms of
integration. This is already becoming a reality with new-age banks such as YES Bank,
and others too adopting a single-PIN. Geography will no longer be an inhibitor.
Technology will prove to be the differentiator in the short-term but the dynamic
environment will soon lead to its saturation and what will ultimately be the key to success
will be a better relationship management.

OVERVIEW

If one were to say that the future of banking in India is bright, it would be a gross
understatement. With the growing competition and convergence of services, the
customers (you and I) stand only to benefit more to say the least. At the same time,
emergence of a multitude of complex financial instruments is foreseen in the near future
(the trend is visible in the current scenario too) which is bound to confuse the customer
more than ever unless she spends hours (maybe days) to understand the same. Hence, I
see a growing trend towards the importance of relationship managers. The success (or
failure) of any bank would depend not only on tapping the untapped customer base (from
other departments of the same bank, customers of related similar institutions or those of
the competitors) but also on the effectiveness in retaining the existing base.
India has witness to a sea change in the way banking is done in the past more than two
decades. Since 1991, the Reserve Bank of India (RBI) took steps to reform the Indian
banking system at a measured pace so that growth could be achieved without exposure to
any macro-environment and systemic risks. Some of these initiatives were deregulation of
interest rates, dilution of the government stake in public sector banks (PSBs), guidelines
being issued for risk management, asset classification, and provisioning. Technology has
made tremendous impact in banking. ‘Anywhere banking’ and ‘Anytime banking’ have
become a reality. The financial sector now operates in a more competitive environment
than before and intermediates relatively large volume of international financial flows. In the
wake of greater financial deregulation and global financial integration, the biggest
challenge before the regulators is of avoiding instability in the financial system.

RISK MANAGEMENT AND BASEL II

The future of banking will undoubtedly rest on risk management dynamics. Only those
banks that have efficient risk management system will survive in the market in the long
run. The effective management of credit risk is a critical component of comprehensive risk
management essential for long-term success of a banking institution.

Although capital serves the purpose of meeting unexpected losses, capital is not a
substitute for inadequate decontrol or risk management systems. Coming years will
witness banks striving to create sound internal control or risk management processes.
With the focus on regulation and risk management in the Basel II framework gaining
prominence, the post-Basel II era will belong to the banks that manage their risks
effectively. The banks with proper risk management systems would not only gain
competitive advantage by way of lower regulatory capital charge, but would also add
value to the shareholders and other stakeholders by properly pricing their services,
adequate provisioning and maintaining a robust financial structure.

‘The future belongs to bigger banks alone, as well as to those which have minimised their
risks considerably.’

CONSOLIDATION

Consolidation, which has been on the counter over the last year or so, is likely to gather
momentum in the coming years. Post April 2009, when the restrictions on operations of
foreign banks will go, the banking landscape is expected to change dramatically. Foreign
banks, which currently account for 5% of total deposits and 8% of total advances, are
devising new business models to capture the Indian market. Their full-fledged entry is
expected to transform the business of banking in many ways, which would be reflected in
terms of greater breadth of products, depth in delivery channels and efficiency in
operations.

Thus Indian banks have less than three years to consolidate their position. Despite the
stiff resistance from certain segments, consolidation holds the key to future growth. This
view is underpinned by the following:
► Owing to greater scale and size, consolidation can help save costs and improve
operational efficiency.
► Banks will also have to explore different avenues for raising capital to meet norms
under Basel-II
► Owing to the diversified operations and credit profiles of merging banks, consolidation
is likely to serve as a risk-mitigation exercise as much as a growth engine.
Though there is no confirmation yet, speculative signals arising from the market point to
the prospect of consolidation involving banks such as Union Bank of India, Bank of India,
Bank of Baroda, Dena Bank, State Bank of Patiala, and Punjab and Sind Bank. Further,
the case for merger between stronger banks has also gained ground — a clear deviation
from the past when only weak banks were thrust on stronger banks. There is a case being
made for mergers between banks with a distinct geographical presence coming together
to leverage their respective strengths.

GLOBALIZATION/ OVERSEAS EXPANSION

Growing integration of economies and the markets around the world is making global
banking a reality. The surge in globalization of finance has already begun to gain
momentum with the technological advancements which have effectively overcome the
national borders in the financial services business. Widespread use of internet banking
will widen frontiers of global banking, and make marketing of financial products and
services on a global basis possible. In the coming years globalization will spread further
on account of the likely opening up of financial services under WTO. India is one of the
104 signatories of Financial Services Agreement (FSA) of 1997. This gives India’s
financial sector including banks an opportunity to expand their business on a quid pro quo
basis.

As per Indian Banks' Association report ‘Banking Industry Vision 2010’, there would be
greater presence of international players in Indian financial system and some of the Indian
banks would become global players in the coming years. So, the new mantra for Indian
banks is to go global in search of new markets, customers and profits.

TECHNOLOGY

There is an imperative need for not mere technology upgradation but also its integration
with the general way of functioning of banks to give them an edge in respect of services
provided to their constituents, better housekeeping, optimizing the use of funds and
building up of MIS for decision making, better management of assets & liabilities and the
risks assumed which in turn have a direct impact on the balance sheets of banks as a
whole. Technology has demonstrated potential to change methods of marketing,
advertising, designing, pricing and distributing financial products and services and cost
savings in the form of an electronic, self-service product delivery channel. These
challenges call for a new, more dynamic, aggressive and challenging work culture to meet
the demands of customer relationships, product differentiation, brand values, reputation,
corporate governance and regulatory prescriptions. Technology holds the key to the future
success of Indian Banks.

Internet, wireless technology and global straight-through processing have created a

paradigm shift in the banking industry. The explosive growth of both the Internet and
mobile and wireless technology is revolutionizing the way the financial industry conducts
business. The overall wireless technology market is expected to grow profoundly in the
coming years.

REGULATIONS

The RBI's approval for banks to raise funds abroad through innovative capital instruments
holds great significance. Such fund-raising, which includes preference shares, will,
however, not just substitute equity; it could have unintended consequences on the
strategies of banks and their profitability. While the cost of raising monies through such
instruments is likely to be higher (close to 10 per cent), the consequent higher leverage on
equity funds is likely to result in expansion of return on net worth. This is because the
same amount of capital supports a higher volume of business, generating higher profits.
Banks are likely to be able to raise long-term preference shares at coupon rates between
six per cent and eight per cent. The positive impact on bank profitability could thus be
significant.
Preference capital can be used as the currency for acquisition. The advantage for public
sector banks is that they no longer need to bother about government stake falling below
51 per cent. Banks such as Dena Bank, Oriental Bank of Commerce and Andhra Bank are
most likely to benefit from this move.

SKILLED MANPOWER

There will be a sea change for employees too. Secure jobs will be replaced by contractual
appointments, for a specified period of time. The unions will merge into the shadows and
bank managements will turn effective. As a result there will be swifter turn over of
personnel in banks. But at the same time, skilled personnel from other disciplines will
enter banks in increasing numbers.
Factors like skills, attitudes and knowledge of the human capital play a crucial role in
determining the competitiveness of the financial sector. The quality of human resources
indicates the ability of banks to deliver value to customers. Capital and technology are
replicable but not the human capital which needs to be valued as a highly valuable
resource for achieving that competitive edge.

Business model, which comprises a comprehensive range of business solutions delivered

through a unique balance of portfolio and relationship management must be
incorporated.

FUTURE CHALLENGES & SUGGESTIONS

Challenges
►Competition
►Customer Retention
►Globalization
►Shrinking Margin

Suggestions
►Strong In-house research & market Intelligence
►Focused marketing- Focus on region-specific campaigns rather than national media
campaigns

The growth of the retail financial services sector has been a key development on the
market front. Indian banks (both public and private) will not only be keen to tap the
domestic market but also to compete in the global market place. New foreign banks will be
equally keen to gain a foothold in the Indian market.

CONCLUSION:

What will the future of Indian banking and insurance look like? Will the reform in banking
and insurance sectors face the same fate as in power and telecom? It is increasingly
evident that the economy offers opportunities but no security! Therefore, the future will
belong to those who develop good internal controls, checks and balances and a sound
market strategy. Business Growth, Cost Efficiency and Evolution are therefore regarded
as key drivers which will have to be addressed.

REFERENCES:

►http://www.thehindubusinessline.com/iw/2006/07/30/stories/2006073000260600.htm
►Rekha Arunkumar, G. Kotreshwar, Risk Management in Commercial Banks, Indian
Institute of Capital Markets 9th Capital Markets Conference Paper
►Bajpai, G.N., Speech on ‘Banking, Insurance and Financial Sector: A vision of the
Future’
►http://www.blonnet.com/businessline/2001/08/09/stories/040941mn.htm
►Newspapers/Magazines – Business Standard, India Today
►Reports: PWC, FICCI
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