Assignment on E-Banking

Submitted to Vinita Garg Maam

Submitted By
Lakshya
B.Voc (1st Semester)

© M A N A G E M E N T S T U D Y G U I D E . C O M . A L L R I G H T S R E S E RV E D .
 CONTENT

What is E-banking?
Development of E-banking
Advantages of the E-Banking
Disadvantages and Risk of E-banking
Precaution of risk and security
Persecutions
 WHAT IS E-BANKING?

Definition:

The provision of banking service through

electronic channels and the customer can access
the data without any time and geographical
limitation.
 DEVELOPMENT OF E-BANKING

1980s :

-Rapid development of the Internet

- TCP/IP system (communication
system)
- E-commerce
 DEVELOPMENT OF E-BANKING

May 1995 :

Wells Fargo - the first bank in the world to offer customer access to their
accounts over the internet .

Allows customer to see their accounts online

 DEVELOPMENT OF E-BANKING

Hong Kong (September 1999 ):

Bank of East Asia - first launched Internet banking

Mortgage applications , personal loans and stock trading
Basic banking functions
DISTRIBUTION OF THREE TYPES OF INTERNET
BANKING

35 institutions
-80% of total customer
deposits

- 60% of total assets of

Hong Kong banking
sector
 GROWTH OF INTERNET BANKING ACCOUNTS

• Personal internet banking accounts grew 12.5%

• Business internet banking accounts grew 53.3%
 DISTRIBUTION OF INTERNET BANKING AMONG 35 INSTITUTIONS

• Six major institutions are serving :

- 78% of all personal internet banking accounts
- 66% of all business internet banking accounts
ADVANTAGES OF E-BANKING

Benefits for Banks

Benefits for Small to Medium Businesses

Benefits for Customers

 BENEFITS FOR BANKS

Larger customer coverage

Reducing the costs of operations

Promoting their services and products internationally

Increasing the customer satisfaction and providing a personalized

relationship with customers
BENEFITS FOR SMALL TO MEDIUM
BUSINESSES

To run its operations more effectively

Lower cost than traditional financial management mechanisms

 BENEFITS FOR CUSTOMERS

Convenience
-24 hours a day, seven days a week

Cost
-Reducing transfer fees

Speed
-Faster circulation of assets

Competitiveness
- Fostering competition in financial market
 BENEFITS FOR CUSTOMERS

Communication
-communicate easily

Environmental
-Abolishing the uses of paper

Others
- Offering one-stop-shop solutions
 BROKERAGE SERVICES

• To create a group
of investment to
observe

• To learn about
companies’ financial
performance online
AUTOMATIC TELLER MACHINE( ATM )

First electronic channel

introduced to HK

Accepting deposits and dispenses

cash

Convenient in handling accounts

A Demonstration of Paying Tax Online of HSBC
Step 1

- Click “Add New Merchant”

A DEMONSTRATION OF PAYING TAX ONLINE OF HSBC

- Choose the category, merchant and bill type

- Insert the bill payee account number
Step 2
A DEMONSTRATION OF PAYING TAX ONLINE OF HSBC

Choose the account that you want to transfer from

Insert the amount of fund that you would like to transfer
Choosing the date of transfer
 DISADVANTAGES ON E-BANKING

•A need for customer skill to deal with

computers and browsers.

E.g. Elderly, Housewives → Inconvenient

•Site change it will make the customer

have some confusion or delay.
•Security Risk
 SECURITY RISK

Increasing number of fraudulent bank websites

Fake emails purporting to be sent from banks
Use of Trojan Horse programs to capture user IDs and passwords
FRAUDULENT BANK WEBSITES

A suspicious bank website:

www.onlinebea.com
Original bank website
www.hkbea.com
The website was
believed to aim
to trick persons
into disclosing
their sensitive
personal information.
 FAKE EMAILS

Email send from

Fraudulent bank
Verify the
personal information
Guide customer
enter the fraud link
Disclosing their
ATM card numbers
and their passwords
 VIRUSES AND WORMS
-TROJAN HORSE PROGRAM

When we open
some suspicious
websites or email
Trojan Horse Program
will install our
computer secretly
Hidden in the computer
When you access
bank websites
Capture our
account and
the password
 PERSECUTIONS

For Bank:

Should provide specific guidance to their customers

 For Customers :
Should not disclose their customer IDs (e.g., account numbers) or
passwords to anyone else.
Periodically change their passwords
Should promptly log out from the service
Should regularly check their account balances and statements to identify
unusual transactions.
 Do not access Corporate Cyberbanking through public terminals.
To safeguard your computer from any other hacker attack, install anti-virus
and anti-spyware software on your computer and update it regularly.
 CASE FROM NEWSPAPER

Don’t use the hyperlink to login to the

website of banks

Should deeply check the postscript of

the website

Observe that is it have the encryption

and compare the login account of
encryption cert is equal to the bank.
MULTIPLE
SECURITY
CONTROLS
STEP 1

Unique ID and PIN to login

STEP 2

Unique Singer PIN to authorize transaction

STEP 3

128-Bit SSL & java applet guarantee end-to-

end encryption
STEP 4

Optional use of digital certificate to login and sign transaction

THANK YOU