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Online Banking Services

Banking sector is the backbone of the country’s economy. They are the elements
of social and economic development of the nation. They are the pillars of support to the
growth and development of the country. The banking sector probably is the most
important financial sector not just in terms of turnover, profits and employment but also
in its vital impact on the other spheres of the economy.

In the five decades since independence, banking in India has evolved through four
distinct phases. During fourth phase, also called as reform phase, recommendations of the
Narasimham Committee (1991) paved the way for the reform phase in banking.
Important initiatives with regard to the reform of the banking system were taken in this
phase. Important among these have been the introduction of new accounting and
prudential norms relating to income recognition, provisioning and capital adequacy, de
regulation of interest rates and easing of norms for entry in the field of banking.

Entry of new banks resulted in a paradigm shift in the ways of banking in India.
The growing competition, growing expectations led to increased awareness amongst
banks on the role and importance of technology in banking. The arrival of foreign and
private banks with their superior state of the art technology based services pushed Indian
banks also to follow suit by going in for the latest technologies so as to meet the threat of
competition and retain their customer base.

Indian banking industry today is in the midst of an IT solution. A combination of


regulatory and competition reasons, have led to increasing importance of the total
banking automation in the banking industry. Technology has opened up new markets,
new products, new services and efficient delivery channels for the banking industry. On
line electronics banking, mobile banking and internet banking are just a few examples.
Due to the emergence of new technologies and on-line transactions, the banking industry
was also shifting their attention to the online banking practices.
A very famous cash management tool that banks now use is their on-line banking
access. Online banking services allows clients of banks to access their account online,
view their balance, check the history of their account, pay bills, transfer funds and other
actions. More and more banks are now moving towards this tool and it is gaining more
popularity.

Internet can be seen as a truly global phenomenon that has made time and
distance irrelevant to many transactions. The transformation from the traditional banking
towards E- banking has been a leap change. The evolution of Electronic Banking started
from the use of Automatic Teller Machine (ATM) and has passed through telephone
banking, direct bill payment, electronic fund transfer and the revolutionary online
banking. The rise in e-commerce and the use of internet in its facilitation along with the
enhanced online security of transaction and sensitive information has been the core
reasons for the penetration of online banking in every day life.