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For longtime technology has made us gape at its possible virtues. We
read about existing experiments in scientist labs. We heard of some queer
happenings. It all appealed to us. We often fell short experiencing them. No
The pace or penetration of technology in our lives has awakened us
from our dreams. Web banking is another addition in a series of
technological wonders in the recent past. It makes our lives convenient.
Imagine checking your account balance from the cozy comports from your
home on a click of mouse. Internet has revolutionized one of the oldest
trades in human civilization banking.
Today’s banks are no more housed in dingy places where employees
sit upon ledger books, taking eternity to check the balance in your account.
The banking sector has undoubtedly been early adopter of technology. From
computerization to networking to ATMS and now E-banking, banks have
moved up the value of chain.
Internet banking has been called web banking, online banking,
electronic banking, home banking, pc banking, and net banking. These are
the similar Internet based products that help conduct remote banking
transactions via the World Wide Web. The Internet may be as old as the
hills. But many Indian banks have begun to realize its enormous potential
only recently. Internet banking systems include account enquiries, funds
transfer, electronic bill payment, transaction histories and account
reconciliation capacities, all provided in a online and real time in simple
terms it does not involve any physical exchange of money, that is, all money

transactions takes place electronically, from one account to another using
Typically, most banks follows five-stage cycle that is mark of entrants
to generic e-business. However, these are m\not stage to another but
continuous changes of different digress in the life of an Internet bank.

In this first stage , a bank enters the arena with an email address. But
without its websites, while this allows its customers to communicate with it,
such communication is severally limited to that small number branches
offices which are fortunate to have an access to this e-mail account.

The bank makes its first active presence by putting up a website that
provides general information about itself, deposits, and loan products,
application forms for downloading about itself ,deposits and loan products
application forms for downloading , and e-mail options for enquires and
feedback. For example at you can get information
about NRI and other services, and gives you
investment information. Further more, Allahabad bank has introduced
educational and car loan at their local branch in a typical click – and – bricks
approach. These websites are static, in a sense that they do not allow online
transactions for their customers.

At this stage, banks permit their customers to transact electronically
with them . Customers open accounts, make changes to their profiles, can
request for cheques , and view and print statements of their accounts.
Movement of funds may be initially, limited between accounts (current and
loan, for example) within the same bank and what the customers get are
essentially products of the host bank. Transactions re timeless (24*7
banking), and essentially fro NRI’s , borderless too, but within the narrow
constraints of forex regulations institutions such as bank of Matura Ltd, and
global trust bank are in this stage where as HDFC expects to offer internet
enabled products only by the end of this year.
It is here that banks begin to offer non-banking products . That range
from investment items such as mutual funds, dematerialization services and
online portfolio investments to online purchases of credit cards, gifts, music
books and movie tickets.
In this last foreseeable stage a ban would be offer B2C and B2B deals,
which are small value transactions and have large unit value. The deeper
water’s of B2B products are yet to be tested. These are recurring transactions
of large value. HDFC bank had entered the market in February this year, and
their performance will be eagerly watched.



Newer Internet based systems allow customer to simply dial in and
use the banks software are software provided by an Internet service provider,
such as America online (AOL).
Customers use any computer to access the internet and then the bank
via modem.
Ease of use, portable often cheaper.
Less versatile fewer features.
The “client-based” systems, in which customers use their own
software, generally use personal financial managers-specialized computer
programs that help customers carry out a verity of personal finance
These programs typically allow customers to do much of their work
offline, and then dial in to complete their bank transactions. These client-
based systems have advantage of allowing customers to ingrate all their
banking information with other personal finance data using a single
Although these software products can be purchased at computer
stores, the versions offered by the institutions are enhanced to adapt their
systems. Some banks will allow customers to download the program for
free, or will mail a copy to customers free or for a small fee. Shopping
elsewhere is likely to reduce the efficiency of the system.

For those who already own’s a personal program or enjoy learning
how to use new software, the client-based approach works well. However,
switching accounts from one bank to another may also require switching to
new personal financial software , and customers will have to invest some
time (and possibly the purchase price of the new program) in order to make
the switch. It could also entail transfer of a lot o information from one
program to another.
A few banks have developed proprietary software for online banking,
which is usually free. Again, changing banks would present the drawbacks
associated with learning a new program.
A handful of banks currently allow customers to choose between the
older online banking systems or the internet however, this is excepted to be
a transitional approach that will stay in place only until the entire online
banking customers switch to the internet . David smith, director of access
management at city bank ,one of the first banks to offer both approaches ,
said the older system might well be eliminated within a year as customer
switch to internet banking .

Customers use money management software and their own computers

to access the bank using a modem and a phone line.

Option of working offline and then signing on over the phone line,
reducing costs.
Integration of banking and personal finance information for more
detailed and comprehensive.

Switching banks require new software and re entry of data.

The two approaches has distinct advantages and disadvantages for

customers. Yet bank customers who do not yet use electronic banking would
probably do well to choose internet banking because the older systems are
likely to faced out during the next few years.


Thank you for choosing a first Indiana account. We’re looking forward
to being your bank. Before you begin, you should know that applicants
must be at least 18 years old and a resident of central Indiana. Please
have the following information nearby to make the application process
quick and easy.
o Your social security number to protect your bank account
o Your driver’s license, so you can enter the number exactly as it
appears on the card.
o Your e-mail address, so we can communicate with your
throughout the account opening process.
o Co-applicant information, if you are opening a joint account.
o The name of the account you wish to apply for.
o Your residential address.

o If you receive mail at a P.O.Box, you will also need your street
address to enter in the initial account holder information. Your
P.O.Box address may be entered in the mailing address section.
For checking accounts:
Here are the methods you may use to open your checking account.
• Credit Card – You may use Visa or MasterCard to open your account.
Please have the name as it appears on your statement, the account
number and expiration date. Your initial deposit must be $25.
• Check by Mail - Once your application is approved, we’ll send you a
postage paid envelope to return a check to us.
Transfer from another first Indiana account – If you’re transferring from a
First Indiana account has your account number handy.
• Transfer from another bank – To transfer from an account at another
bank, you will need your account number, the name of your financial
institution, and their routing number. If the funds are coming from your
checking account, please have a check nearby and we’ll show you where
this information can be found. If you are transferring from a savings or
other account that doesn’t offer checks, you will need to ask your bank
for this information. Your initial deposit must be $25.
Once your account is funded, First Indiana will issue a VISA debit
card to the primary account holder. Additional cards can be obtained by
contacting First Indiana.
For cds and savings accounts:
You may open a CD or Savings account for any amount with the
following methods.

• Check by Mail – Once your application is approved, we’ll send
you a postage paid envelope to return a check to us.
• Transfer From Another Account - If you’re transferring from a
First Indiana account have your account have your account number
handy. You will be able to make changes or corrections before
submitting your application.


A typical process of using credit cards is shown in figure. The
procedure varies depending upon the agreement among brand, issuer and

 The major steps in the process are:

• A potential cardholder requests an issuing bank, from in which
the cardholder may have an account, the issuance of a card band
(like VISA or Master card).
• The issuing bank approves (or denies) the application.
• If approve, a plastic card is physically delivered to the
customer’s address by mail.
• The card is activated as soon as the cardholder calls the bank
for initiation and signs the back of the card.
 The cardholder shows the card to a merchant whenever he or she needs
to pay for a product or service.
 The merchant then asks for approval from the brand company, and the
transactions paid by credit. The merchant keeps a sales slip.

 The merchant sells the slip to the acquiring bank and pays a feel for the
service. This is called a capturing process.
 The acquiring bank requests the brand to clear for the credit amount and
gets paid. Then the brand asks for clearance to issuer bank.
 The amount is transferred from issuer to brand. The same amount is
deducted from the cardholder’s account in the issuing bank.

Cardholders 2.Show 4. Capture

Credit Card.
3. Authentication
1. Issue credit card. Card Brand

6. Amount transfer 5. Payment Request

Issuer Bank Acquirer Bank

Account Account

FIG1.Credit Card Procedure

• Get current account balances at any time: you can easily check
the status of checking, saving and money market account.
• Obtain charge and credit card statement: you can even set up
your account to pay off cards automatically every month.
• Pay bills: electronic payments from your accounts are normally
credited the same day or the next. The cost of paying bills
electrically may well be less than the postage involved in sending
out a large no of payments each month.
• Transfer money between accounts: no more waiting lines,
deposit slips and running to ATMs.
• Balance your accounts: if you are the kind of person who to
forgets record ATMs withdrawals, online banking may help you
get organized. Just down load the transactions and import them
into your register.
• Send e-mail to your bank: got a problem with your account?
You can send a quick note to your online bank representative.
• Additional services: customers of some banks receive free
phone banking with their online banking services.
There are also disadvantages.
• Customer Mindset:

Despite being it-savvy many customers are afraid of the new
technology. One fear is that the credit card number may be captured
and misused for other purchases. Lack of time, and apathy could be
other reasons. However with the speedy entry of skilled it people,
there would be a better understanding of the use of secured lines
passwords and firewalls, with a strong likelihood that public fear
would wane.

• Access Casts:
To the average Indian, the Internet is not very attractive because
of high telephone rental, access charges and low access speeds. For the
individual, a good internet ready pc may not be available for less than
however there are positive indications: access charges have been falling and
a few free connections like costs have also fallen. Our
market driven economy has seen the average family invest heavily into a
variety of white goods even in the rural areas. There is no reason why the pc
should not affordable at current prices. And finally, with the launch of new
satellites and entry of new ISPs, faster Internet access speeds may soon
became a reality.
An industry that deals in funds cannot but have the best security that
is available the customer’s first contact with bank is acknowledged with a
unique name (ID) and a password to begin transactions. The login serves to
electronically and identifies the customers to the bank.
Customers are repeatedly advised to repeat their passwords
frequently, and not to share it with others or even write it down.

However passwords have been sometimes found to be unreliable.
Therefore, bank’s computers scramble customers’ messages so that if they
cannot be deciphered. The scrambling process converts the entire message
and the related data, like time and date into a hash number using a unique
private cryptographic key of the customer.
Although, 40-bit encryption is the current international grade
standard, banks, in U.S. This prevents encrypted information being written
on to the hard disk of the customer, so that an unauthorized user is unable to
read it. Additionally, each time the customer logs on; he uses a new lock and
key provided by the scrambler.
Lastly banks also firewalls in place to ensure that unauthorized users
do not break into their computers. Constant monitoring of their systems
provides their customers the highest possible level of Security.

No more waiting in long log queues. Just log in into your accounts
into your account and logout with the cash. These are the words that best
describe the way banking is moving forward.