Index

Sr.no Titles Page no

1 Abstract

2 Introduction

a) Company Profile

b) vision Mission & Quality policy

c) Products & Service Profile

d) Category of (IT) & its type

3 Research Methodology

&

Data Collection

4 Literature Review

5 Data Analysis & Interpretation

6 Conclusion

7 Bibliography

8 Appendix
ROLE OF INFORMATION TECHNOLOGY (IT) IN BANK
SECTOR
 Abstract:

Ever since the Nationalization of Banks in India, Banking Sector has been growing
with leaps and bounds and catering to the needs of various segments of the society.
In recent times, the Banking Sector has been making rapid straights by using
information technology as a platform and endeavouring to scale higher heights.
Commercial Banks in India are now becoming a one-stop Supermarket.

The focus is shifting from mass banking to class banking with the introduction of
value added and customized products. Technology allows banks to create what
looks like a branch in a business building‘s lobby without having to hire manpower
for manual operations.

The branches are running on the concept of 24 X 7 working, made possible by the
use of Tele banking, ATMs, Internet banking, Mobile banking and E -banking.
Today, E-Banking is used as a strategic tool by the global banking sector to attract
and retain customers. An attempt has been made in this paper to examine E-
Banking and its implications in banking industry.
 Introduction:

With the Globalization trends world over it is difficult for any nation big or small,
developed or developing, to remain isolated from what is happening around. For a
country like India, which is one of the most promising emerging markets, such
isolation is nearly impossible. More particularly in the area of Information
technology, where India has definitely an edge over its competitors, remaining
away or uniformity of the world trends is untenable.

Financial sector in general and banking industry in particular is the largest spender
and beneficiary from information technology. The technological evolution of the
Indian banking industry has been largely directed by the various committees set up
by the RBI and the government of India to review the implementation of
technological change.

No major breakthrough in technology implementation was achieved by the

industry till the early 80s, though some working groups and committees made stray
references to the need for mechanization of some banking processes. This was
largely due to the stiff resistance by the very strong bank employees unions. The
early 1980s were instrumental in the introduction of mechanization and
computerization in Indian banks.

Information technology has improved the efficiency and robustness of business

processes across banking sector. India's banking sector has made rapid strides in
reforming itself to the new competitive business environment. Indian banking
industry is the midst of an IT revolution.
 Technological infrastructure has become an indispensable part of the reforms
process in the banking system, with the gradual development of sophisticated
instruments and innovations in market practices.

E-banking is the term that signifies and encompasses the entire sphere of
technology initiatives that have taken place in the banking industry. E-banking is a
generic term making use of electronic channels through telephone, mobile phones,
internet etc. for delivery of banking services and products. The concept and scope
of e-banking is still in the transitional stage.

It increases efficiency in the sphere of effective payment and accounting system

thereby enhancing the pace of delivery of banking services considerably. It allows
customers to access banking services electronically such as to pay bills, transfer
funds, view accounts or to obtain any banking information and advice. E-banking
also facilitates new relationships with customers, regulatory authorities, suppliers
and banking partners with digital-age tools. For example, customers and bank
relationships will become more personalized, resulting in new modes of transaction
processing and service delivery.

Company Profile:

In the embryonic phases, IT was looked upon a means to get rid of high processing
cost and time and to convert the manual operation with high volume/ low
complexity in two mechanical ones. With the evolutionary the process, it was seen
as the best means of generating, MIS.
Vision
A vision articulates the position that an organization would like to attain in the distant future. It
helps in creating a common identity and a shared sense

Mission
 Mission refers to the purpose of an organization. Mission states the business

 Reason for the organization's existence. It relates the organization to the society.

 The mission of an organization should aim high and at the same time it must be realistic.

 It should provide a strategic direction for the organization.

Quality Policy

 With automation, service no longer remains a marketing edge with the large banks only.

 Complete with the established banks, by integrating IT in their operations.

 The technology has commoditizing some of the financial services.

 Therefore the banks cannot take a lifetime relationship with the customers as granted and
they have to work

Products & Services

With around 8,000 staff members in our global network, it provides services to customers in
more than 150 countries,

The Investment Bank focuses on its traditional strengths in financing, advisory, fixed income and
currencies. It continues to provide strategic advice to corporate clients including a focused equity
capital markets business,
The Private Bank focuses on private customers across all segments as well as business clients. It
will build on its position as market leader in Germany, as a focused bank in Europe and a highly
competitive wealth manager,

The asset manager DWS continues to pursue its objective of becoming one of the top-10 asset
managers globally by investing in growth areas and playing an active role in the consolidation of
the asset management industry.
 Research Methodology & Data Collection:

In this study secondary data is used the sources of secondary data are internet, journals and
magazines, apart from this sources SBI website is also used to provide insight into the services
provided by E-Banking.

The study uses both primary and secondary data the primary data has been collected from 50
respondents on basis of convenient sampling The samples were collected from customer of
various banking sector

TOOLS FOR THE STUDY:

The analysis of data collected through research been done systematically Simple percentage, Pie
Chart and tables were used to represent variety of data that falls into various categories The
analysis has been done systematically and accurately
LIMITATION OF STUDY:
 My research has several limitation

 This study was primarily limited by small sample size

 The sample size could have been expanded

 Literature Review

As discussed by Turner (2001) , progress in information technology has slashed the costs
of processing information, while the internet has facilitated its transmission, thus
facilitating change is the very essence of the banking business. Around the world,
electronic banking services, whether delivered online or through other mechanisms, have
spread quickly in recent years. It must be noted that the impact of e-banking is not limited
to industrial and advanced emerging economies. Even in countries with underdeveloped
banking systems, E-banking has offered many new business opportunities.

Sathya (1997) reviewed the status of internet banking. The study found that only two of
the 52 banks started internet banking services. He opined that education would be a
crucial factor for expanding internet banking. If customers are convinced about the
various advantages of internet banking they will start asking for this service from their
banks, and will put pressure on the banks to go ahead with internet banking.

Mookerjee (1998) explored that internet banking is fast becoming popular in India.
Nevertheless, it is still in its evolutionary stage. They expect that a large sophisticated and
highly competitive internet banking market will develop in future.

Joseph et al. (1999) examined the influence of internet on the delivery of banking
services. They found six primary dimensions of e-banking service quality such as
convenience and accuracy, feedback and complaint management, efficiency, queue
management, accessibility and customization.

Mols (1999) acknowledged that the internet banking is an innovative distribution

channel that offers less waiting time and a higher spatial convenience than traditional
branch banking with significantly lower cost structure than traditional delivery channels.
Internet banking reduces not only operational cost to the bank but also leads to higher
levels of customer satisfaction and retention. As a result, internet banking is very
attractive to banks and consumers, who now have higher acceptance to new technology
 Data analysis & Interpretation

Level of Usage of Technology

Usage of Technology No. of Respondents Percentage

Financial Transaction 5 16.66%
Stock Exchange 2 6.66%
Online Banking 15 50%
E-Payments 8 26.66%
TOTAL 30 100%

Showing Level of usage of technology

Level of Usage of Technology

17%
27% Financial Transaction
7% Stock Exchange
Online Banking
E-Payments

50%
According to analysis done 50% of repondents use of technology for online banking,
26.66% of repondents use for e-payments,16.66% for financial transaction and 6.66% of
repondents use of technology in banking service for stock exchange

How Frequently Branch Banking Used

Branch Banking No of
Use per Month Respondent Percentage
Nil 3 10%
1 to 3 times 16 53.33%
3 to 8 times 8 26.66%
8 to 12 times 1 3.33%
Over 12 times 2 6.66%
TOTAL 30 100%
 Showing how frequently branch banking
Used per month

Branch Banking Per Month

3% 7%

10% Nil
1 to 3 times
3 to 8 times
8 to 12 times
27% Over 12 times

53%

Analysis shows that 10% of the respondents never visit their bank branch on a monthly
basis. 53.33% of respondents visit their banks between 1 to 3 times in a month.26.66%
of respondents visit their bank branch 3 to 8 times in a month and 3.33% of respondents
visit their branch 8 to 12 times in a month. None of the respondents vist their bank more
than 12 times a month
How Frequently ATM Used

Showing how frequently ATM

Used per month

ATM No of
Use Per Month Respondent Percentage
Nil 0 0%
1 to 3 times 6 20%
3 to 8 times 15 50%
8 to 12 times 5 16.66%
Over 12 times 4 13.33%
TOTAL 30 100%
 ATM USED PER MONTH

19% 23% Nil

1 to 3 times
3 to 8 times
8 to 12 times

58%

Analysis shows that none of the respondents never visit their ATMs on a monthly basis.
20% of respondents visit their ATM 1 to 3 times in a month 50% of respondents visit
their ATM 3 to 8 times in a month, 16.66% of respondents visit ATM 8 to 12 times in a
month and 13.33% of respondents visit the ATM over 12 times in a month.

How frequent Internet Banking is Used

Showing how frequent Internet Banking is

Used per month
Internet Banking No of
Use per month Respondents Percentage
nil 3 10%
1 to 3 times 12 40%
3 to 8 times 6 20%
8 to 12 times 5 16.66%
Over 12 times 4 13.33%
TOTAL 30 100%

Internet Banking Used Per Month

13% 10%
Nil
1 to 3 time
3 to 8 time
17% 8 to 12 time
Over 12 time
40%

20%

According to the analysis done it shows 10% of respondents never use their internet
banking on monthly basis, 40% of respondents use their internet banking 1 to 3 times in a
month, 20% of respondents use internet banking 3 to 8 times in a month, 16.66% of
respondents use internet banking 8 to 12 times in a month and 13.33% of respondents use
internet banking over 12 times in a month
Reasons why E-Banking Services not used

Showing reasons why E-banking services

not used by most of the customer

E-Banking Services Number of

Not Adopted Respondents Percentage
Security Risk 12 40%
Prefer Traditional
Banking 7 23.3%
Not Aware of
E-Banking 5 16.6%
Some Bank Charge
High Fees 6 20%
TOTAL 30 100%
 E-Banking Services Not Adopted

20% Security Risk

Prefer Traditional Banking
40% Not Aware of E-Banking
Some Bank Charges High Fees
17%

23%

According to this analysis 40% of respondents have not adopted E-Banking due to security risk.
23.30% of respondents prefer traditional Banking and 16.60% of respondents are not aware of e-
banking. 20% of respondents consider that bank charges high fees for e-banking.
 Finding

According to the study it was found that technology has praved a huge way fot baking secator. A
large number of respondents prefer E-Banking in the study region. A large number of
respondents are satisfied with ATM facilities provide by bank. majority of the respondents do
not use Tele banking in the study region. A large number of respondents are benefited by paying
utility bills by using Mobile Banking.

Based on the study it was found that 90% of the respondents prefer using internet Banking A
large number of respondents are satisfied with the level of security provided by the bank only
10% of the respondents are not satisfied according to the study conducted. security threat is the
possible reasons why E-Banking service have not been adopted by the respondents

The study shows that majority of the respondents consider Private sector bank to be
technologyically advanced than public sector bank to be large number of the respond nts. rate the
technology oriented service of the bank as good in the study region majotrity of the customers
have opined that bank' s operation is effecient after the introduction of computer in the banks.
 Suggestion

 The bank needs to give awarness to customers about internet baking.

 Most of the customers are feeling risk in E-banking so the banking industry need to
eliminate those risks.
 Conclusion

E-banking has become essential for the bankers and the customers in order to gain advantage.

There are many services offered by banks online it is the customers who have to explore the
services and take the advantage of the reduction of cost and time. Even there is a shift of users
from normal to traditional it is only nominal.

SBI facilitates to its customers regarding their account information, transfer of funds, pay bills,
E-services and fixed deposits through its E-Banking services.

The bank needs to give awarness to customers about internet banking. Most of the customers are
feeling risk in E-banking so the banking industry need to eliminate those risks.
 Bibiliography

Aggarwal (2003) : In his paper, looked for such avenues where e-banking could play
significant role in e-democracy

Arora (2003) : made an attempt to prove that technology had a definitive role in
facilitating transactions in the banking sector; and the impact of technology had resulted
into the introduction of new products and services by various banks in India.

Laforet and Li (2005), : in their study investigated the market status of online / mobile
banking in China.

Ashiya (2006) : evaluated developments made by electronic payments. The author

evaluated different

modes of e-payment used acr ss the globe.Enders et al. (2006),: in t eir paper,
addressed a fundamental problem of the disruptive innovation theory which lies in the
difficulty to categorize newtechnologies into sustai ing and disruptive
innovation
Jain and Hundal (2006) : described the importance of mobile banking and barriers in
the adoption of mobile banking.

Krishnamurthy (2006) : highlighted the advantages, risks, innovations and

convenience involved in e- banking. ATM, telephone, internet and cluster banking
helped banks to deliver the products more effectively.

Paul (2006) : discussed the role of technology and scope of remote channels, their
implication, strength, weakness, opportunity and threat in banking sector.

Raghvan (2006) : highlighted he transformation in the banking sector due to effect of

information technology, telecommunication and electronic data processing.

Raja et al. (2008) : evaluated the impact of e-payment system on the business
opportunities.
Sarangapani and Mamth (2008) : studied the impact of Information Technology on
banking sector and its security related aspects.

Uppal R.K. (2010) : studies the extent of mobile banking in Indian banking industry
during 2000- 2007. The study concludes th t among all e-channels.

Hua G. (2009) : investigat s the online banking acceptance in China by conducting an

experiment to investigate how users’ perception about online banking is affected by the
perceived ease of use of website and the privacy policy provided by the online banking
website.

Sharma M.C. and Sharma Abhinav: Reported that Indian public sector banks that hold
around 75 % of market share do have taken initiative in the field of IT.

Sreelatha T and Chandra Shekhar Reveled: That Technology has charged t e face of
the Indian banking sector through computation, while new private sector banks and
foreign banks have an edge in this regard.

Bradley and Stewart (2003): Nearly every bank will have technology services available
by the year 2011.