MINI PROJECT REPORT

ON
“APPLICATION OF EMERGING TECHNOLOGY IN BANKING
INDUSTRY”

SUBMITTED IN THE PARTIAL FULFILLMENT FOR THE AWARD OF DEGREE OF

MASTER OF BUSINESS ADMINISTRATION

(2022-2023)

Submitted By - Submitted To -
Sakshi Mishra Ms. Akshita Pandey
MBA 1st Year UIM (Dept. Of Management)
Sec – D
Roll No.: - 2200110700174

UNITED INSTITUTE OF MANAGEMET NAINI,

USIDC, INDUSTRIAL AREA NAINI, PRAYAGRAJ
 UNITED INSTITUTE OF MANAGEMENT
A-31 UPSIDC Industrial Area, Naini, Prayagraj - 211010
Ph. 0532-2686070. 2686090 Fax 0532-2687147
Certificate
Mini Project Report II – 2022-2023

This is to certify that Mr/Ms …...SAKSHI MISHRA…… Roll No. ……

2200110700174…... student of MBA 2nd semester of our institute has prepared
a report on the topic……
He /She has developed the concept of developing new Product/Service under
my supervision and has completed the same in conformance with / partial
fulfilment of the provision of AKTU, Lucknow.
The work is original and has not been submitted anywhere else is any manner.

Signature ……………………....

Name: Mr / Ms / Dr …………….
Project guide Department of
Business Administration
Date …………………...
Counter Signed
Signature……………………
(Prof. K.K. Malviya)
Principal
Date.........................
 ACKNOWLEDGEMENT

It is a matter of great pleasure to thanks all esteemed who helped me

to complete my final research project successfully otherwise it would
not been possible.
Acknowledgement is not only a ritual but also an expression of
indebtedness to all those who have helped in the completion process
of the project. One of the most pleasant aspects in collecting the
necessary and vital information and compiling it is the opportunity to
thanks all those whose activity contributed to it.
I would like to express my deepest gratitude and thanks To PROF.
KK. MALVIYA (PRINCIPAL UIM), MR. ROHIT KUMAR
VISHWAKARMA (HEAD OF DEPARTMENT UIM), MR. PRIYATOSH
MISHRA (ASST. PROFESSOR) and (CLASS COORDINATOR), MR.
AKSHAY PETER (ASST. PROFESSOR) (SUBJECT CORDINATOR)
and project guide (MS. AKSHITA PANDEY) (ASST. PROFESSOR)
of the valuable guidance and constant encouragement which extend to
me through my research project.

Date:
Place: Prayagraj

Sakshi Mishra
MBA 1st Sec – D
Roll No.: -2200110700174
 DECLARATION

We hereby declare that the project entitled – “APPLICATION OF

EMERGING TECHNOLOGY IN BANKING INDUSTRY”
which is being submitted as Mini Project of 2 nd
semester in UNITED INSTITUTE OF MANAGEMENT
NAINI, PRAYAGRAJ (U.P) is an authentic record of our genuine
work done under the guidance of MS. AKSHITA PANDEY (ASST.
PROFESSOR).

Date:
Place: Prayagraj

Sakshi Mishra
MBA 1st Sec – D
Roll No.: -2200110700174
 INDEX

S. No TOPIC

1 INTRODUCTION

2 OBJECTIVE OF THE PROJECT

3 REVIEW OF LITERATURE

4 OVERVIEW OF INDUSTRY

5 ISSUES AND CHALLENGES

6 IMPACT OF TECHNOLOGIES
TO RESOLVE ISSUES AND
CHALLENGES

7 SUGGESTIVE STRATEGIES

8 LEARNING OUTCOME

9 RECOMMENDATIONS

10 REFERNCES
CHAPTER -1

INTRODUCTION
The banking sector is the lifeline of any modern economy. It is one of the
important financial pillars of the financial sector, which plays a vital role in the
functioning of an economy. It is very important for economic development of a
country that its financing requirements of trade, industry and agriculture are met
with higher degree of commitment and responsibility.
Thus, the development of a country is integrally linked with the development of
banking. In a modern economy, banks are to be considered not as dealers in
money but as the leaders of development.
They play an important role in the mobilization of deposits and disbursement of
credit to various sectors of the economy. The banking system reflects the
economic health of the country. The strength of an economy depends on the
strength and efficiency of the financial system, which in turn depends on a
sound and solvent banking system. A sound banking system efficiently
mobilized savings in productive sectors and a solvent banking system ensures
that the bank is capable of meeting its obligation to the depositors.
In India, banks are playing a crucial role in socio-economic progress of the
country after independence. The banking sector is dominant in India as it
accounts for more than half the assets of the financial sector. Indian banks have
been going through a fascinating phase through rapid changes brought about by
financial sector reforms, which are being implemented in a phased manner.

The current process of transformation should be viewed as an opportunity to

convert Indian banking into a sound, strong and vibrant system capable of
playing its role efficiently and effectively on their own without imposing any
burden on government. After the liberalization of the Indian economy, the
Government has announced a number of reform measures on the basis of the
recommendation of the Narasimhan Committee to make the banking sector
economically viable and competitively strong. The current global crisis that hit
every country raised various issue regarding efficiency and solvency of banking
system in front of policy makers.
Now, crisis has been almost over, Government of India (GOI) and Reserve
Bank of India (RBI) are trying to draw some lessons.
RBI is making necessary changes in his policy to ensure price stability in the
economy. The main objective of these changes is to increase the efficiency of
banking system as a whole as well as of individual institutions. So, it is
necessary to measure the efficiency of Indian Banks so that corrective steps can
be taken to improve the health of banking system.

Why is the banking industry important?

The banking industry plays a crucial role in the overall functioning of the
economy and has several important roles and contributions. Here are some
reasons why the banking industry is important:

Financial Intermediation: Banks act as intermediaries between savers and

borrowers. They collect deposits from individuals and businesses and channel
those funds to borrowers in the form of loans. This intermediation process helps
to allocate capital efficiently and facilitate economic growth by providing funds
for various investment opportunities.

Payment System: Banks provide a secure and efficient payment system,

allowing individuals, businesses, and institutions to transfer funds
electronically. This facilitates the exchange of goods and services, making
transactions convenient and enabling economic activities to take place
smoothly.

Credit Creation: Banks have the ability to create credit by lending out more
money than they hold in deposits. This process, known as fractional reserve
banking, allows banks to expand the money supply in the economy and support
economic growth by providing credit to businesses and individuals for
investment, consumption, and other purposes.

Capital Formation: Banks play a vital role in mobilizing savings from

individuals and businesses and directing those funds towards productive
investments. By providing loans and financial services, banks facilitate capital
formation and contribute to the development of infrastructure, industries, and
businesses.

Risk Management: Banks offer a range of financial products and services to

help individuals and businesses manage financial risks. These include
insurance, hedging instruments, and derivatives. By providing risk management
tools, banks contribute to financial stability and assist in minimizing the impact
of various risks on the economy.

Monetary Policy Transmission: Central banks utilize various tools to

implement monetary policy and influence the overall economy. Banks play a
crucial role in this process by implementing the policies set by central banks.
They adjust interest rates, control money supply, and influence lending
practices, thereby impacting inflation, economic growth, and employment.

Financial Services: Banks provide a wide array of financial services, such as

savings accounts, checking accounts, credit cards, mortgages, investment
advisory, and wealth management services. These services cater to the diverse
financial needs of individuals, businesses, and governments, enhancing
economic efficiency and fostering financial inclusion.

Economic Stability: A stable banking system is essential for overall economic

stability. Banks are responsible for maintaining the safety and soundness of the
financial system, protecting depositors' funds, and managing risks. They are
subject to regulatory oversight to ensure their stability and mitigate systemic
risks that could disrupt the economy.

The banking industry is important because it facilitates financial intermediation,

supports economic growth, provides a payment system, creates credit, mobilizes
savings, manages risks, transmits monetary policy, offers financial services, and
contributes to economic stability. Its functions are vital for the smooth
functioning and development of an economy.
The banking industry has undergone significant transformations in recent years
with the widespread implementation of technology. Technology has
revolutionized the way banks operate, transforming traditional banking
practices and enhancing the overall customer experience. This introduction of
technology has brought about numerous changes, including the digitization of
services, increased automation, and improved security measures.
One of the key advancements in the banking industry is the digitalization of
services. Banks have adopted online and mobile platforms, allowing customers
to access their accounts, make transactions, and perform various banking
activities from the comfort of their homes or on the go. This shift has not only
increased convenience for customers but has also reduced the reliance on
physical branches, leading to cost savings for banks.

Furthermore, technology has enabled automation in various banking processes.

Tasks that were previously performed manually, such as account opening, loan
processing, and document verification, are now automated using advanced
software systems. This automation has significantly streamlined operations,
reduced errors, and increasing efficiency. It has also freed up bank employees to
focus on more complex customer needs and provide personalized services.
CHAPTER-2
 OBJECTIVE

 To study the issues and challenges of banking industry.

 To identify the emerging trend and technology which helps in resolving
the problem.
 CHAPTER-3

REVIEW OF LITERATURE
Thematic Analysis of Financial Technology (Fintech) Influence on the
Banking Industry
(Parminder Varma, Shivinder Nijjer, Kiran Sood, Simon Grima, Ramona
Rupeika-Apogai in 2022)
The synthesis of technology and finance is known as financial technology
(Fintech), which brings together two of the biggest industries in harmony.
Fintech disruption is a deviation from the norm, resulting in a significant shift in
banking services and, as a result, risk. This article aims to investigate how
Fintech has influenced recent changes in the banking industry and upcoming
challenges, with a particular emphasis on blockchain technology.
We perform a comprehensive thematic analysis of recent studies on Fintech in
the banking industry. We found that Fintech has enormous potential to grow
and impact the banking industry and the entire world. The banking industry
could benefit from combining emerging technology.

Digital transformation of the banking system in the context of sustainable

development
(Imeda A Tsindeliani, Maxim M Proshunin, Tatyana D Sadovskaya,
Zhanna G Popkova, Mariam A Davydova, Oksana A Babayan in 2022)
The purpose of this paper is to study the current state of the Russian banking
system in the context of digital economy development, to establish and identify
the benchmarks and needs of legal regulation, to study the potential possibilities
of digitalization of relations in the banking sector in the mechanism of
implementing prudential rules.
Using the method of political and legal analysis used in this study, the legal
guidelines for the digitalization of the banking sector and the financial services
market have been determined, which in the Russian legal system are strategic
planning documents.
Findings: International research in the field of banking indicates that
digitalization and globalization of the economy stimulate the processes of
international regulatory cooperation and harmonization of legislation, the use of
new approaches in the development and adoption of regulations in the financial
market. The growth of digitalization of relations in the banking sector will
contribute to the effective implementation of prudential rules, including those
related to the need to protect public interests.
Originality/value: The study revealed a number of issues related to the
digitalization of the activities of credit institutions that are professional
participants in the securities market and the central bank as a financial mega-
regulator, requiring a legal solution. Measures aimed at improving the current
legislation and procedures of state regulation and supervision are proposed.

Blockchain and banking: How technological innovations are shaping the

banking industry
(Pierluigi Martino in 2021)
This book explores blockchain technology’s impact on banks, particularly how
blockchain technology can create new opportunities for banks and poses new
threats to their business. The digital revolution in the banking industry, whose
customers are increasingly adapting to new technologies and new types of
competitors and solutions arising in the space, has had a significant impact on
the banking industry over the past few years, requiring banks to substantially
rethink their business models and strategies in order to cope with these
developments.
The rise of blockchain’s distributed ledger technology (DLT) has also played an
important role since it has the potential to change the whole banking industry in
faster and more disruptive ways than ever before. Born as the technology
underlying Bitcoin, which has been used to allow the recording of
cryptocurrencies transactions, blockchain can facilitate the process of recording
any transaction type and track the movement of any asset, finding application in
many different areas.
Specifically, it has been acknowledged as a disruptive force in the financial
sector and a key source of future financial market innovation with the potential
to reshape existing business models in the financial services industry. Regarding
the banking industry in particular, existing literature suggests that blockchain
poses new challenges and generates opportunities as well as threats. This is
pushing banks to rethink their operations, business models and strategies.
However, literature in this regard is still in its infancy, and we do not yet have a
clear understanding of blockchain technology’s potential implications for banks.
This book expands the literature on blockchain technology in banking by
providing new insights into the developments, trends and challenges of
blockchain in the banking industry. In particular, sheds more.
Light on the implications of blockchain technology for banks by discussing the
advantages and disadvantages related to this technology and exploring its
potential impact on traditional banking business models.

Digital technologies’ implementation within financial and banking system

during socio distancing restrictions–back to the future
(Dr Narcisa Roxana Moşteanu, Dr Alessio Faccia, Luigi Pio Leonardo
Cavaliere, Saurav Bhatia in 2020)
In 2020, the pandemic socio distancing restrictions affect both individuals and
businesses. Financial transactions become a little more difficult to be conducted
with cash, and online banking transactions are called to help the good
development of economic activity. Having in mind that the stance in bank
digitalization in each country differs, the paper aims to estimate the level of
digitalization of banking sector, as well as reasons and factors determining the
actual movements of digital banking.
In order to achieve the objective, the paper is structured as follows, elaborates
the changes in demand and supply of banking services as result of socio-
financial disruption caused by the pandemic situation, financial digitalization
and digitalization changes in the banking sector on global level, and the benefits
of digitalization for individuals and businesses at the same level.
Such approach secures the solid base for determining the measures and further
steps for increasing the level of digitalization of the banking sector together
with educating the population in the use of new digital technologies.

The effect of mobile banking application on customer interaction in the

Jordanian banking industry
(Khaled Aldiabat, Anwar Al-Gasaymeh, Ameer K Rashid in 2019)
Banks have changed from paper-based banking solutions provider to the latest
of the technologies like mobile banking. Adoption of mobile-banking has
received more attention in recent years, because there are more phones than
computers in the market. But, like in any emerging technology, there exist
barriers to the adoption of mobile banking services.
This study will attempt to technically address these largely unfounded factors
while helping to lay a roadmap for proper implementation of mobile banking
technology in the Jordanian banking industry. The study found that Supportive
Access factor of mobile banking is associated with the user satisfaction related
to mobile banking.

Theory and practice of innovation development in the banking sector

(Malgorzata Zaleska, Przemysław Kondraciuk in 2019)
The aim of this article is to systematise the approach to innovation in the
economic theory and to define the indicators used to measure the innovativeness
of world economies. The considerations are focused on innovation in the
banking sector as it is one of the most innovative sectors worldwide.
The identification of the stages of innovation development in this branch is
worth emphasising, along with the description of its economic and legal
determinants.

Financial technology in banking industry: Challenges and opportunities

(Ahmed Al-Ajlouni, Dr Al-Hakim, Monir Suliaman in 2018)
An overwhelming interest is growing in financial technology (henceforth:
FinTech) in recent years. This contemporary financial phenomenon
characterized basically by heavy use of technology in communication, some
called it network economics.
FinTech service encapsulates–but not restricted to–wide range of financial
services capitalising from the explosive developments in technology, it includes
the payments, clearing and settlement category, followed by credit, deposit and
capital raising services.
Despite the fact that the FinTech players attract the global attention from the
financial industry leaders and legislators, the issue as a subject of study still in
infant stage, little scientific research has been conducted yet. The paper aims at
first place to shed light on this wave of development in financial industry that
combined with high technology, it aims also to clarify the role of FinTech in the
financial industry in general and banking sector in particular. The paper
obtained its goals in two main phases, firstly; background and definition of the
FinTech, in addition to outlining the current FinTech market segments and
landscape and some alternative financing FinTech platforms will be discussed.
In the second phase, we will identify the influence of FinTech on banking
industry and the required response to face it. The paper suggested also some
future research proposals about the effect of FinTech on the financial industry
and banking sector in the Arab countries.

Blockchain technology application in Indian banking sector

(Abhishek Gupta, Stuti Gupta, in 2018)
Banking and technology are very closely associated and innovations have
changed the framework of banking process drastically. The digital innovations
in the banking sector started with the introduction of money that replaced the
barter system and then the gradual replacement of wax seal with digital
signatures. One such disruptive innovation which is changing the banking sector
globally is Blockchain Technology (BCT).
The paper aims to provide an overview of Blockchain Technology with its
benefits and emphasizing on the applications of the technology in the Indian
Banking Sector. The paper gives the insight of various challenges and global
perspective of Blockchain Technology in banking industry.
CHAPTER-4
 INDUSTRY OVERVIEW

The modern banking industry is a network of financial institutions licensed by

the state to supply banking services. The principal services offered relate to
storing, transferring, extending credit against, or managing the risks associated
with holding various forms of wealth. The precise bundle of financial services
offered at any given time has varied considerably across institutions, across
time, and across jurisdictions, evolving in step with changes in the regulation of
the industry, the development of the economy, and advances in information and
communications technologies.
Banking is an industry that handles cash, credit, and other financial transactions.
Banks provide a Safe place to Store extra cash and credit. They offer savings
accounts, Certificates of Deposit, and checking accounts. Banks use these
deposits to make loans. These loans include home mortgages, business loans,
and car loans. A Bank is a financial institution licensed to receive deposits and
make loans. Two of the most common types of banks are commercial/retail and
investment banks.
Depending on type, a bank may also provide various financial services ranging
from providing safe deposit boxes and currency exchange to retirement and
wealth management. Banking is a business activity which involves accepting
money from public in the form of deposits and lending it as loans for earning
profit. Banking institutions mainly serves the purpose of safeguarding people’s
money or fulfilling their fund requirements by providing them loan facilities.
These types of institution pay interest on deposit to savers and charges higher
rate of interest from borrowers. Difference between these two rates of interest is
the bank profit. Apart from accepting and lending money, banks also provide
many other services such as lockers, ATM services, online fund transfers,
cheque payments, foreign currency exchange, issuing debit/credit cards etc.
Banks accept deposits from public under different categories of accounts like
saving account, current account, fixed deposit and recurring deposit account.
In the same way, these institutions lend money to public as overdraft facility,
personal loan, business loan and mortgaged loan. Banking institutions play a
key role in economic development of country as it is ensuring the liquidity of
funds by movement of funds among people.
FUNCTIONS
Banks as financial intermediaries are party to a transfer of funds from the
ultimate saver to the ultimate user of funds. Often, banks usefully alter the terms
of the contractual arrangement as the funds move through the transfer process in
a manner that supports and promotes economic activity. By issuing tradable
claims (bank deposits) against itself, the bank can add a flexibility to the
circulating media of exchange in a manner that enhances the performance of the
payments system.
These deposits may support the extension of personal credit to consumers (retail
banking) or short-term credit to nonfinancial businesses (commercial banking).
If so, the bank aids the management of liquidity, thus promoting household
consumption and commerce. By facilitating the collection of funds from a large
number of small savers, each for a short period, the bank promotes the pooling
of funds to lend out in larger denominations for longer periods to those seeking
to finance investment in larger capital projects.
Financing investment may take the form of underwriting issues of securities
(investment banking) or lending against real estate (mortgage banking). By
specializing in the assessment of risk, the bank can monitor borrower
performance; by diversifying across investment projects, the bank minimizes
some types of risk and promotes the allocation of funds to those endeavours
with the greatest economic potential.
By extending trade credit internationally (merchant banking), the bank can
facilitate international trade and commerce. As one last example, by lending to
other banks in times of external pressures on liquidity, the bank can manage
core liquidity in the financial system, thus potentially stabilizing prices and
output (central banking).
To discharge its various functions, banks of all types manage highly leveraged
portfolios of financial assets and liabilities. Some of the most crucial questions
for the banking industry and state regulators certain on questions of how best to
manage the portfolio of deposit banks, given the vital role of these banks in
extending commercial credit and enabling payments.
With bank capital (roughly equal to the net value of its assets after deduction of
its liabilities) but a small fraction of total assets, bank solvency is particularly
vulnerable to credit risk, market risk, and liquidity risk. An increase in non-
performing loans, a drop in the market price of assets, or a shortage of cash
reserves that forces a distress sale of assets to meet depositors’ demand can
each, if transpiring over a period of time too short for the bank to manage the
losses, threaten bank solvency.

ORIGINS OF MODERN BANKING

The modern banking industry, offering a wide range of financial services, has a
relatively recent history; elements of banking have been in existence for
centuries, however. The idea of offering safe storage of wealth and extending
credit to facilitate trade has its roots in the early practices of receiving deposits
of objects of wealth (gold, cattle, and grain, for example), making loans,
changing money from one currency to another, and testing coins for purity and
weight. The innovation of fractional reserve banking early in this history
permitted greater profitability (with funds used to acquire income earning assets
rather than held as idle cash reserves) but exposed the deposit bank to a unique
risk when later paired with the requirement of converting deposits into currency
on demand at par, since the demand at any particular moment may exceed
actual reserves. Douglas Diamond and Philip Dybvig have, for example, shown
in their 1983 article “Bank Runs, Liquidity, and Deposit Insurance” that in such
an environment, a sufficiently large withdrawal of bank deposits can threaten
bank liquidity, spark a fear of insolvency, and thus trigger a bank run. Means of
extending short-term credit to support trade and early risk-sharing arrangements
afforded by such devices as marine insurance appear in medieval times. Italian
moneychangers formed early currency markets in the twelfth century CE at
cloth fairs that toured the Champagne and Brie regions of France. The bill of
exchange, as a means of payment, was in use at this time as well. Over the
course of the seventeenth and eighteenth centuries, the industry transformed
from a system composed of individual moneylenders financially supporting
merchant trade and commerce, as well as royalty acquiring personal debt to
finance colonial expansion, into a network of joint-stock banks with a national
debt under the control and management of the state.
The Bank of England, for example, as one of the oldest central banks, was a
joint-stock bank initially owned by London’s commercial interests and had as
its primary purpose the financing of the state’s imperial activities by taxation
and the implementing of the permanent loan. This period was also marked by
several experiments with bank notes (with John Law’s experiment in France in
1719–1720 among the most infamous) and the emergence of the check as
simplified version of the bill of exchange. Eighteenth-century British banking
practices and structures were transported to North America and formed an
integral part of the colonial economies from the outset. The first chartered bank
was established in Philadelphia in 1781 and in Lower Canada in 1817.
Experiments with free banking—as a largely unregulated business activity in
which commercial banks could issue their own bank notes and deposits, subject
to a requirement that these be convertible into gold—have periodically received
political support and have appeared briefly in modern Western financial history.
Public interest in minimizing the risk of financial panics and either limiting or
channelling financial power to some advantage has more often, however,
dominated and justified enhanced industry regulation.

BANK REGULATION
Various forms of bank regulation include antitrust enforcement, asset
restrictions, capital standards, conflict rules, disclosure rules, geographic and
product line entry restrictions, interest rate ceilings, and investing and reporting
requirements. The dominant view holds that enhanced regulation of this
industry is necessary because there is clear public sector advantage, or for
protecting the consumer by controlling abuses of financial power, or because
there is a market failure in need of correction.
Where public sector advantage justifies the need for regulation, government
intervention may appear in the form of reserve requirements imposed on
deposit-taking institutions for facilitating the conduct of monetary policy or in
the various ways in which governments steer credit to those sectors deemed
important for some greater social purpose.
Limiting concentration and controlling abuses of power and thus protecting the
consumer have motivated such legislation as the American unit banking rules
(whereby banks were limited physically to a single center of operation) and
interest rate ceilings (ostensibly designed to prohibit excessive prices), as well
as various reporting and disclosure requirements.
The latent threat of a financial crisis is an example of a market failure that
regulation may correct. Here, the failure is in the market’s inability to properly
assess and price risk. The systemic risk inherent in a bank collapse introduces
social costs not accounted for in private sector decisions. The implication is that
managers, when constructing their portfolios, will assume more risk than is
socially desirable; hence, there exists a need for government-imposed constraint
and control. State-sanctioned measures designed to minimize the threat of bank
runs include the need for a lender of last resort function of the central bank to
preserve system liquidity and the creation of a government-administered system
of retail banking deposit insurance. Regulation explicitly limiting the risk
assumed by managers of banks includes restrictions that limit the types and
amounts of assets an institution can acquire. A stock market crash will threaten
solvency of all banks whose portfolios are linked to the declining equity values.
Investment bank portfolios will be, in such a circumstance, adversely affected.
The decline in the asset values of investment banks can spill over to deposit
banks causing a banking crisis when the assets of deposit banks include
marketable securities, as happened in the United States in the early 1930s. The
Bank Act of 1933 (the Glass-Steagall Act) in the United States as well as early
versions of the Bank Act in Canada, for example, both prohibited commercial
banks from acquiring ownership in nonfinancial companies, thus effectively
excluding commercial banks from the investment banking activities of
underwriting and trading in securities.
This highly regulated and differentiated industry structure in twentieth-century
North America contrasts sharply with the contemporaneous banking structures
of Switzerland and Germany, for example, where the institutions known as
universal banks offer a greater array of both commercial and investment
banking services. The question for policymakers then is which industry
structure best minimizes the risk of banking crises and better promotes
macroeconomic stability and growth.
CHAPTER-5
 ISSUE & CHALLENGES OF BANKING INDUSTRY

The banking industry is undergoing a radical shift, one driven by new

competition from FinTech’s, changing business models, mounting regulation
and compliance pressures, and disruptive technologies. The emergence of
FinTech/non-bank startups is changing the competitive landscape in financial
services, forcing traditional institutions to rethink the way they do business. As
data breaches become prevalent and privacy concerns intensify, regulatory and
compliance requirements become more restrictive as a result. And, if all of that
wasn’t enough, customer demands are evolving as consumers seek round-the-
clock personalized service. These and other banking industry challenges can be
resolved by the very technology that’s caused this disruption, but the transition
from legacy systems to innovative solutions hasn’t always been an easy one.
That said, banks and credit unions need to embrace digital transformation if
they wish to not only survive but thrive in the current landscape.

1. Increasing Competition
The threat posed by FinTech’s, which typically target some of the most
profitable areas in financial services, is significant. Goldman Sachs predicted
that these startups would account for upwards of $4.7 trillion in annual revenue
being diverted from traditional financial services companies.
These new industry entrants are forcing many financial institutions to seek
partnerships and/or acquisition opportunities as a stop-gap measure; in fact,
Goldman Sachs, themselves, recently made headlines for heavily investing in
FinTech. In order to maintain a competitive edge, traditional banks and credit
unions must learn from FinTech’s, which owe their success to providing a
simplified and intuitive customer experience.

2. A Cultural Shift
From artificial intelligence (AI)-enabled wearables that monitor the wearer’s
health to smart thermostats that enable you to adjust heating settings from
internet-connected devices, technology has become ingrained in our culture —
and this extends to the banking industry. In the digital world, there’s no room
for manual processes and systems. Banks and credit unions need to think of
technology-based resolutions to banking industry challenges. Therefore, it’s
important that financial institutions promote a culture of innovation, in which
technology is leveraged to optimize existing processes and procedures for
maximum efficiency. This cultural shift toward a technology-first attitude is
reflective of the larger industry-wide acceptance of digital transformation.

3. Regulatory Compliance
Regulatory compliance has become one of the most significant banking industry
challenges as a direct result of the dramatic increase in regulatory fees relative
to earnings and credit losses since the 2008 financial crisis. From Basel’s risk-
weighted capital requirements to the Dodd-Frank Act, and from the Financial
Account Standards Board’s Current Expected Cr to the Allowance for Loan and
Lease Losses (ALLL), there are a growing number of regulations that banks and
credit unions must comply with; compliance can significantly strain resources
and is often dependent on the ability to correlate data from disparate sources.
Technology is a critical component in creating this culture of compliance.
Technology that collects and mines data, performs in-depth data analysis, and
provides insightful reporting is especially valuable for identifying and
minimizing compliance risk. In addition, technology can help standardize
processes, ensure procedures are followed correctly and consistently, and
enables organizations to keep up with new regulatory/industry policy changes.

4. Changing Business Models

The cost associated with compliance management is just one of many banking
industry challenges forcing financial institutions to change the way they do
business. The increasing cost of capital combined with sustained low interest
rates, decreasing return on equity, and decreased proprietary trading are all
putting pressure on traditional sources of banking profitability. In spite of this,
shareholder expectations remain unchanged. This culmination of factors has led
many institutions to create new competitive service offerings, rationalize
business lines, and seek sustainable improvements in operational efficiencies to
maintain profitability. Failure to adapt to changing demands is not an option;
therefore, financial institutions must be structured for agility and be prepared to
pivot when necessary.

5. Rising Expectations
Today’s consumer is smarter, savvier, and more informed than ever before and
expects a high degree of personalization and convenience out of their banking
experience. Changing customer demographics play a major role in these
heightened expectations:
With each new generation of banking customer comes a more innate
understanding of technology and, as a result, an increased expectation of
digitized experiences. Millennials have led the charge to digitization, with five
out of six reporting that they prefer to interact with brands via social media;
when surveyed, millennials were also found to make up the largest percentage
of mobile banking users, at 47%. Based on this trend, banks can expect future
generations, starting with Gen Z, to be even more invested in omnichannel
banking and attuned to technology. By comparison, Baby Boomers and older
members of Gen X typically value human interaction and prefer to visit physical
branch locations.
This presents banks and credit unions with a unique challenge: How can they
satisfy older generations and younger generations of banking customers at the
same time? The answer is a hybrid banking model that integrates digital
experiences into traditional bank branches.
Imagine, if you will, a physical branch with a self-service station that displays
the most cutting-edge smart devices, which customers can use to access their
bank’s knowledge base. Should a customer require additional assistance, they
can use one of these devices to schedule an appointment with one of the
branch’s financial advisors; during the appointment, the advisor will answer any
of the customer’s questions, as well as set them up with a mobile AI assistant
that can provide them with additional recommendations based on their
behaviour. It might sound too good to be true, but the branch of the future
already exists, and it’s helping banks and credit unions meet and exceed rising
customer expectations.
Investor expectations must be accounted for, as well. Annual profits are a major
concern — after all, stakeholders need to know that they’ll receive a return on
their investment or equity and, in order for that to happen, banks need to
actually turn a profit. This ties back into customer expectations because, in an
increasingly constituent-centric world, satisfied customers are the key to
sustained business success — so, the happier your customers are, the happier
your investors will be.

6. Customer Retention
Financial services customers expect personalized and meaningful experiences
through simple and intuitive interfaces on any device, anywhere, and at any
time. Although customer experience can be hard to quantify, customer turnover
is tangible and customer loyalty is quickly becoming an endangered concept.
Customer loyalty is a product of rich client relationships that begin with
knowing the customer and their expectations, as well as implementing an
ongoing client-centric approach.
In an Accenture Financial Services global study of nearly 33,000 banking
customers spanning 18 markets, 49% of respondents indicated that customer
service drives loyalty. By knowing the customer and engaging with them
accordingly, financial institutions can optimize interactions that result in
increased customer satisfaction and wallet share, and a subsequent decrease in
customer churn.
Bots are one new tool financial organizations can use to deliver superior
customer service. Bots are a helpful way to increase customer engagement
without incurring additional costs, and studies show that the majority of
consumers prefer virtual assistance for timely issue resolution. As the first line
of customer interaction, bots can engage customers naturally, conversationally,
and contextually, thereby improving resolution time and customer satisfaction.
Using sentiment analysis, bots are also able to gather information through
dialogue, while understanding context through the recognition of emotional
cues. With this information, they can quickly evaluate, escalate, and route
complex issues to humans for resolution.

7. Outdated Mobile Experiences

These days, every bank or credit union has its own branded mobile application -
however, just because an organization has a mobile banking strategy doesn’t
mean that it’s being leveraged as effectively as possible. A bank’s mobile
experience needs to be fast, easy to use, fully featured (think live chat, voice-
enabled digital assistance, and the like), secure, and regularly updated in order
to keep customers satisfied.
Some banks have even started to reimagine what a banking app could be by
introducing mobile payment functionality that enables customers to treat their
smart phones like secure digital wallets and instantly transfer money to family
and friends. 8. Security Breaches With a series of high-profile breaches over the
past few years, security is one of the leading banking industry challenges, as
well as a major concern for bank and credit union customers. Financial
institutions must invest in the latest technology-driven security measures to
keep sensitive customer safe.
CHAPTER-6
 IMPACT OF TECHNOLOGIES TO RESOLVE ISSUES AND
CHALLENGES

Banking is undergoing a technological churn right now due to rising

competition from fin-tech startups and increasing concern for cyber-security.
Today, we are going to look at 10 technologies that are going to impact the
future of banking sector! FSI sector in general, and Banking in particular, are
undergoing a technological churn right now.
The reason is two-fold: changing customer expectations and improved
technological capabilities. The rising competition from Fin-tech start-ups that
use technology to create unique customer experiences around banking & other
financial services has forced the large banks to respond by innovating
themselves. Further, the threat of cyber-security breaches has meant that banks
need to be more agile than ever before.
Today, we are going to look at 10 innovative technologies in banking that are
shaping the future. For long, banks have been reluctant to update their systems –
and for good reason. The current systems that they use are the product of years
of continued innovation to meet immediate customer requirements.
But this has resulted in siloed systems being used for the transaction, savings,
investment and loan accounts. This is not suited for the digital age when the
competition for banks is coming from technology-based FinTech startups.
Banks and other traditional financial service provider have had to respond with
an array of digitization and innovation initiatives.
These initiatives employ cutting-edge technologies to ensure a customer-centric
perspective rather than the traditional focus on products, real-time intelligent
data integration rather than slow analysis being performed after-the-fact and
open platform foundation.
Further, the threat of cyber-security breaches has meant that banks need to be
more agile than ever before. Today, we are going to look at 10 innovative
technologies in banking that are shaping the future. For long, banks have been
reluctant to update their systems – and for good reason. The current systems that
they use are the product of years of continued innovation to meet immediate
customer requirements.
But this has resulted in siloed systems being used for the transaction, savings,
investment and loan accounts. This is not suited for the digital age when the
competition for banks is coming from technology-based FinTech startups.
Banks and other traditional financial service provider have had to respond with
an array of digitization and innovation initiatives. These initiatives employ
cutting-edge technologies to ensure a customer-centric perspective rather than
the traditional focus on products, real-time intelligent data integration rather
than slow analysis being performed after-the-fact and open platform foundation.

1.Augmented Reality
Immersive technologies such as Augmented, virtual, and mixed reality are
enhancing customer experience across the board. So why can’t they do the same
for banking customers? The possibilities of the implementation of augmented
reality technology in banking sector are only limited by imagination, though
these are still in a very early stage of development. The end state is to give
customers complete autonomy in actions and transactions they could perform at
home. Hybrid branches are envisioned by technology experts who believe that
bank branches as we know them today are a thing of past. One of the
implementations of augmented reality technology in banking sector, that is
already live, has been made by the Commonwealth Bank of Australia. They
have created a rich date augmented reality application for their customers who
were looking to buy or sell a home. It provides them with information like
current listings, recent sales, and price tendencies to help the customer make
better decisions.

2. Blockchain
Blockchain is a catchall phrase used to describe distributed ledger technologies.
You could think of it as a distributed database with no DBA involved. It allows
multiple parties to access the same data simultaneously, and at the same time
ensures the integrity and immutability of the records entered in the database. At
present, leading bank around the world are exploring proof of concept projects
across various aspects of banking and financial services.
The first major implementation that we are likely to see is in the areas for
clearing and settlement. Accenture estimates that investment banks would be
able to save $10 billion by deploying blockchain technology to improve the
efficiency of clearing and settlement systems.
Another major area in which banks will see a huge saving by using blockchain
technology is KYC (Know Your Customer) operations. Business models being
developed at the moment would turn KYC from a cost centre into a profit centre
for banks – as they would come to rely on a shared blockchain for this activity.
Syndicated loans, trade finance and payments are other areas where the smart
contracts on blockchain could be highly effective.

3. Robotic Process Automation

The volume of unstructured data that the bank has to process is increasing
exponentially with the rise of the digital economy. This is not just banking
transaction data, but also other behavioural data that could potentially allow the
banks to improve and innovate customer experience.
This has made bankers realize that they need to find technologies that can
mimic human action and judgment but at a higher speed, scale, and quality. The
answer that has emerged is a combination of various technologies that enable
cognitive and robotic process automation in banking.
These technologies consist of machine learning, natural language processing,
chatbots, robotic process automation, and intelligent analytics in banking that
allow the bots to learn and improve.
It is no surprise that Deloitte’s 2017 State of Cognitive survey found that 88%
of financial service professionals believe that such technologies are a strategic
priority. That said, the current state of the art in robotic automation is still quite
weak at the cognitive and analytical aspects of the processes.
In the years to come, we would see the current cognitive capabilities being
bundled with thrombotic process automation to achieve even better results. This
is already being implemented in point-of-sale solutions that automatically
suggest marketing promotions that would be most effective for an individual
customer.

4. Quantum Computing
Quantum computing is a way of using quantum mechanics to work out complex
data operations. As is common knowledge today, computers use bits that can
have two values – 1 or 0. Quantum computing uses “quantum bits” that can
instead have three states – 1 or 0 or both. This unlocks exponential computing
power over traditional computing – when the right algorithm is used. This
represents a huge leap in computing power, but any commercial
implementations are still decades away.
Nevertheless, firms like JPMorgan Chase and Barclays are investing in quantum
computing research in partnership with IBM.

5. Artificial Intelligence
The explosive growth that the last decade has seen in the amount of structured
and unstructured data available with the banks, combined with the growth of
cloud computing and machine learning technologies has created a perfect storm
for Artificial Intelligence to be used across the spectrum of banking and
financial services landscape.
Business needs and capabilities of AI implementations have grown hand-in-
hand and banks are looking at Artificial Intelligence as a differentiator to beat
down the emerging competition.
Artificial Intelligence allows banks to use the large histories of data that they
capture to make much better decisions across various functions including back-
office operations, customer experience, marketing, product delivery risk
management, and compliance.
Artificial intelligence would revolutionize banks by shifting the focus from the
scale of assets to scale of data. The banks would now aim to deliver tailored
experiences to their customers rather than build mass products for large
markets.
Instead of retaining customers through high switching costs, banks would now
be able to become more customer-focused and retain them by providing high
retention benefits. Most importantly, banks would no more just depend on
human ingenuity for improving their services. Instead, performance would be a
product of the interplay between technology and talent.

6. API Platforms
The time when banks could control the whole customer experience through a
monolithic system that controlled everything from keeping records to every
customer interaction is long gone. Both the regulatory requirements and the
revolving customer needs have turned this humongous system into dinosaurs.
Today banks need to instead build “banking stacks” that allow them to be a
platform to which customers and third-party service providers can connect to
deliver a flexible and personalized experience to the end user. To do so, they
can use API platforms for banking.
API Banking Platform is designed to work through APIs that sit between the
banks' backend execution and front-end experiences provided by either the bank
itself or third-party partners.
This allows the banks to adopt completely new business models and use cases
(for example, enabling salary advances) and experiment with new technologies
like blockchain at low cost.
APIs also help banks to future-proof their systems as the front-end is no more
tightly coupled with the backend.

7. Prescriptive Security
The nature of cyber risk changes at a great speed. This makes the traditional
approaches to risk management obsolete. It is now clear that it is impossible for
organizations to eliminate all possible sources of cyber threats and limiting the
attack footprint at the earliest is the best way to deal with these. The banks will
have to be nimble in the way they approach cyber security.
Increasingly banks are deploying advanced analytic, real-time monitoring and
AI to detect threats and stop them from disrupting the systems. The use of big
data analysis techniques to get an earlier visibility of threats and acting to stop
them before they happen is called prescriptive security.
While the disruption brought by implementing the new technique may lead to
an increase in vulnerability at the start, this is the way forward to stop the ever-
increasing data breaches that various organizations are reporting.

8. Hybrid Cloud
One of the biggest challenges that the digital age has brought to banking is the
need to respond quickly. The constantly evolving market that banks operate in
requires them to be as agile as possible. They need to be able to provide
resources across the enterprise in a timely manner to address business problems
faster.
High performing banks have discovered that the most cost-effective way of
achieving this is through an enterprise-wide hybrid cloud. This allows them to
pick benefits of both public and private while addressing issues like data
security, governance, and compliance along with the ability to mobilize large
resources in a matter of minutes.
Hybrid cloud also allows banks to offer innovative new offerings to its
customers. For example, ICICI Bank has partnered with Zoho to allow
businesses to automate the basic reconciliation process through Zoho Books, a
cloud accounting software. The partnership does away with the need for data
entry and also makes it easier to offer multiple payment options to the
customers.

9. Instant Payments
As the world moves towards a less-cash economy, the customer expectations
around payments have changed dramatically. Both customers and business
expect payments to happen instantaneously, and this is where instant payment
systems step in.
Instantaneous payment is a must if online payments need to replace cash
transactions. Therefore, banks around the world are finding ways of providing
their customers options for instant payment, even when the infrastructure
required for the service is lacking.
For example, banks in Kenya are partnering together to provide P2P payment
experience to their customer base. You would soon see banks combining their
instant payment capabilities with third-party e- and m-commerce solutions to
develop a new portfolio of services.
10.Smart Machines
You must have already seen assistants like Amazon’s Alexa and Google Home
in action. Can you imagine the impact these could have on banking
applications?
In fact, Bank of America has already developed Erica as a virtual assistant
specifically for banking operations. These smart machines are beginning to act
as digital concierges for the customer in interacting with banks as well.
CHAPTER-7
 SUGGESTIVE STRATEGY

The banking industry has been at the forefront of adopting technological

advancements to improve efficiency, enhance security, and provide better
customer experiences. Here are some suggestions for implementing technology
in the banking industry:

1. Mobile Banking Applications: Develop robust mobile banking

applications that enable customers to perform various banking activities
conveniently, such as checking account balances, transferring funds,
making payments, and applying for loans.

2. Biometric Authentication: Implement biometric authentication methods,

such as fingerprint or facial recognition, to enhance security and
streamline the authentication process for customers accessing their
accounts or making transactions.

3. Chatbots and Virtual Assistants: Integrate chatbots or virtual assistants

into banking platforms to provide instant customer support, answer
frequently asked questions, assist with basic banking tasks, and provide
personalized recommendations based on customer preferences and
transaction history.

4. Robotic Process Automation (RPA): Utilize RPA technology to

automate repetitive and rule-based tasks, such as data entry, document
processing, and compliance checks, which can significantly reduce
operational costs and human errors.
5. Data Analytics and Machine Learning: Leverage advanced analytics
and machine learning algorithms to analyse vast amounts of customer
data and gain insights into customer behaviour, risk assessment, fraud
detection, and personalized product recommendations.

6. Open Banking APIs: Implement open banking APIs (Application

Programming Interfaces) to enable seamless integration with third-party
applications and services, fostering innovation and allowing customers to
access their financial data from multiple sources in a secure manner.

7. Blockchain Technology: Explore the potential of blockchain technology

for secure and transparent transactions, digital identity management,
cross-border payments, and smart contracts, which can enhance
efficiency and reduce costs.

8. Cybersecurity Measures: Strengthen cybersecurity measures by

implementing advanced encryption techniques, multi-factor
authentication, real-time fraud detection systems, and regular security
audits to protect customer data and prevent unauthorized access.

9. Cloud Computing: Adopt cloud computing solutions to improve

scalability, data storage, and disaster recovery capabilities, while
reducing infrastructure costs and enabling remote access to banking
services.

10. Personal Financial Management Tools: Develop integrated personal

financial management tools that provide customers with a comprehensive
view of their finances, budgeting features, expense tracking, and financial
goal setting.

11. Robo-Advisors: Introduce robot-advisory services that utilize algorithms

and artificial intelligence to provide automated investment advice and
portfolio management based on customer preferences, risk tolerance, and
financial goals.

12. Digital Onboarding: Simplify the customer onboarding process by

implementing digital onboarding solutions, including electronic identity
verification and digital signatures, to streamline account opening and loan
applications.

CHAPTER-8
 LEARNING OUTCOME

Learning outcomes contribute to the overall digital transformation of the

banking industry, enabling banks to stay relevant, meet customer expectations,
and thrive in a digital-first era.
1. Enhanced Efficiency: Technology implementation in the banking
industry aims to improve operational efficiency by automating processes,
reducing manual intervention, and streamlining workflows. Learning
outcomes include increased productivity, faster transaction processing,
and reduced errors.

2. Improved Customer Experience: By leveraging technology, banks can

deliver personalized and seamless customer experiences. Learning
outcomes include increased customer satisfaction, convenience, and
access to a wider range of banking services through digital channels.

3. Enhanced Security and Fraud Prevention: Implementing advanced

technologies strengthens security measures and enables better fraud
detection and prevention. Learning outcomes include reduced instances
of fraud, enhanced customer trust, and secure data protection.

4. Data-Driven Insights: Technology implementation allows banks to

gather and analyse vast amounts of data to derive actionable insights.
Learning outcomes include better decision-making, improved risk
management, and the ability to offer personalized products and services
based on customer preferences and behaviours.
5. Innovation and Agility: Adopting technology fosters a culture of
innovation and enables banks to stay agile in a rapidly evolving industry.
Learning outcomes include the ability to adapt to market trends, embrace
emerging technologies, and collaborate with FinTech partners for mutual
benefit.

6. Regulatory Compliance: Technology implementation ensures adherence

to regulatory requirements and compliance standards. Learning outcomes
include a better understanding of regulatory obligations, improved
reporting capabilities, and the ability to implement robust compliance
measures.

7. Cost Optimization: Technology implementation can lead to cost

optimization through process automation, reduced manual efforts, and
streamlined operations. Learning outcomes include increased cost
efficiency, optimized resource allocation, and improved profitability.

8. Skills Development: Implementing technology requires acquiring new

skills and expertise among employees. Learning outcomes include
upskilling and reskilling of the workforce, fostering a tech-savvy culture,
and developing competencies related to emerging technologies.

9. Collaboration and Partnerships: Embracing technology opens

opportunities for collaboration with technology providers, FinTech
startups, and other stakeholders. Learning outcomes include fostering
partnerships for innovation, leveraging external expertise, and exploring
new business models.

10. Industry Competitiveness: Technology implementation enhances a

bank's competitive edge by offering innovative products, personalized
services, and superior customer experiences. Learning outcomes include
improved market positioning, increased market share, and sustained
growth in a competitive landscape.

11.Digital Literacy: Technology implementation requires employees and

customers to develop digital literacy skills. Learning outcomes include
 improved digital literacy among employees, enabling them to leverage
technology effectively, and educating customers on digital banking
services.

12.Change Management: Implementing technology in the banking industry

often involves significant organizational changes. Learning outcomes
include developing change management capabilities, fostering
adaptability and resilience, and effectively managing transitions to new
technology systems and processes.
13.Customer Empowerment: Technology implementation empowers
customers by providing them with greater control over their financial
activities. Learning outcomes include increased financial literacy,
improved financial decision-making, and the ability to access and manage
financial services independently.
14.Scalability and Flexibility: Implementing scalable and flexible
technology solutions allows banks to adapt to changing market conditions
and customer demands. Learning outcomes include the ability to quickly
scale operations, introduce new products and services, and efficiently
respond to market dynamics.
15.Continuous Improvement: Technology implementation encourages a
culture of continuous improvement and innovation within the banking
industry. Learning outcomes include fostering a mindset of
experimentation and learning, promoting continuous process
enhancements, and embracing feedback for ongoing improvement.

16.Data Governance and Ethics: Implementing technology requires a

focus on data governance and ethical use of customer data. Learning
outcomes include understanding data privacy regulations, ensuring data
integrity and security, and establishing ethical frameworks for data usage
and analytics.

17.Risk Assessment and Mitigation: Technology implementation involves

identifying and mitigating potential risks associated with new
technologies and processes. Learning outcomes include developing risk
assessment capabilities, implementing effective risk management
strategies, and enhancing resilience against emerging threats.

18.Collaboration and Cross-Functional Teams: Technology

implementation often requires collaboration among different teams and
departments within a bank. Learning outcomes include fostering cross-
 functional collaboration, breaking down silos, and promoting a culture of
teamwork and shared goals.

19.Regulatory and Compliance Knowledge: Implementing technology in

the banking industry necessitates a deep understanding of regulatory and
compliance requirements. Learning outcomes include staying updated on
evolving regulations, ensuring adherence to compliance standards, and
establishing strong internal controls.

20.Ecosystem Integration: Technology implementation encourages

integration with external partners, such as FinTech companies, regulators,
and other financial institutions. Learning outcomes include developing
integration capabilities, fostering partnerships, and leveraging the
strengths of various ecosystem players for mutual benefit.
CHAPTER-9
 RECOMMENDATION AND CONCLUSION

Successful implementation of technology requires careful planning, effective

change management, and continuous monitoring of performance and customer
feedback. It's crucial to align technology initiatives with your organization's
strategic objectives and prioritize customer-centric solutions to drive positive
outcomes.
1. Digital Literacy: Technology implementation requires employees and
customers to develop digital literacy skills. Learning outcomes include
improved digital literacy among employees, enabling them to leverage
technology effectively, and educating customers on digital banking
services.

2. Change Management: Implementing technology in the banking industry

often involves significant organizational changes. Learning outcomes
include developing change management capabilities, fostering
adaptability and resilience, and effectively managing transitions to new
technology systems and processes.

3. Customer Empowerment: Technology implementation empowers

customers by providing them with greater control over their financial
activities. Learning outcomes include increased financial literacy,
improved financial decision-making, and the ability to access and manage
financial services independently.

4. Scalability and Flexibility: Implementing scalable and flexible

technology solutions allows banks to adapt to changing market conditions
and customer demands. Learning outcomes include the ability to quickly
scale operations, introduce new products and services, and efficiently
respond to market dynamics.
5. Continuous Improvement: Technology implementation encourages a
culture of continuous improvement and innovation within the banking
industry. Learning outcomes include fostering a mindset of
experimentation and learning, promoting continuous process
enhancements, and embracing feedback for ongoing improvement.

6. Data Governance and Ethics: Implementing technology requires a

focus on data governance and ethical use of customer data. Learning
outcomes include understanding data privacy regulations, ensuring data
integrity and security, and establishing ethical frameworks for data usage
and analytics.

7. Risk Assessment and Mitigation: Technology implementation involves

identifying and mitigating potential risks associated with new
technologies and processes. Learning outcomes include developing risk
assessment capabilities, implementing effective risk management
strategies, and enhancing resilience against emerging threats.

8. Collaboration and Cross-Functional Teams: Technology

implementation often requires collaboration among different teams and
departments within a bank. Learning outcomes include fostering cross-
functional collaboration, breaking down silos, and promoting a culture of
teamwork and shared goals.

9. Regulatory and Compliance Knowledge: Implementing technology in

the banking industry necessitates a deep understanding of regulatory and
compliance requirements. Learning outcomes include staying updated on
evolving regulations, ensuring adherence to compliance standards, and
establishing strong internal controls.

10.Ecosystem Integration: Technology implementation encourages

integration with external partners, such as FinTech companies, regulators,
and other financial institutions. Learning outcomes include developing
 integration capabilities, fostering partnerships, and leveraging the
strengths of various ecosystem players for mutual benefit.

CONCLUSION

Banking Industry is one of the fastest changing and growing industry in the
world. Banks are adopting new technologies to increase their business. They
have also contributed in general to the world’s economic growth.
But their own shortcomings, such as NPAs and a lack of adequate rural
presence, must be tackled. The good news is that by providing quality service
and growing into untapped regions, they will work towards turning this
weakness into opportunities.
This would allow them to counter the global challenges of recessions and
intense competition more effectively. Another factor that banks have to take
care of is ensuring that their digital infrastructure is up-to-date and running
correctly. The banking industry will therefore ensure that it continues its
successful march. Banking is changing due to UPI payments and Payment
Wallets like PhonePe, Amazon Pay, Paytm, etc.
CHAPTER-10
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