Technology in

Finance
 ATMs
Electronic
Banking

Branch
Banking
Branch 3
Branch 2

Branch 1
Head Office
Branch 4

Branch 5
Branch n

Branch 6
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 E-Banking
 BANKNET –
A communication software to provide
message and file transfer between branches of
banks and across banks

 CRM (Customer Relationship Management) -

Is an information technology
industry term for methodologies,
strategies, software, and other
web-based capabilities that help
an enterprise organize and manage
customer relationships.
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 E-Banking

 ALPM (Advanced Ledger Posting

Machine) –

Micro processor based electronic device

used for maintenance of primary ledgers, working
out products and interests at periodical intervals,
preparation of account statements and listing of
standing instructions to be executed in the accounts.
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 DBMS (Database Management System) –
A set of computer programs that controls the
creation, maintenance, and utilization of the databases of an
organization.

 E-Commerce -
Is conducting business communications and transactions viz
computers over networks. It is the buying and selling of
goods and services through digital communication

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 E-Banking
Touch Screen :
Recognizes human touch. Users can point to the
select something on the screen.

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 E-BANKING DEVELOPMENTS
 ALPMs and Back Office Computerization.

 NEED TO IMPROVE CUSTOMER SERVICE

 INTRODUCTION OF COMPUTERISATION
ATMs, ELECTRONIC FUND TRANSFERS, BANKNET,
ELECTRONIC MAIL, CREDIT CARDS, ONLINE
BANKING, TELE-BANKING, ETC

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Indian Banking-Now...
 Mobile Banking / Phone Banking

 Network Banking

 Virtual Banking

 Universal Banking

 Online Banking / Internet Banking

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WHY TECHNOLOGY IN FINANCE ?
 To transform financial services industry
in the net worked world,

 Banks to be customer centric

 Provided services/ products
 Across range of channels
 To be futuristic and have “TIME” value
in all its dealings with customer.

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Many Benefits of Technology
 Increased operational efficiency,
profitability & productivity
 Superior Customer Service
 Multi-channel, real-time transaction
processing
 Better Cross-Selling ability
 Improved management / accountability
 Efficient NPA and Risk Management
 Minimal transaction costs
 Improved financial analyses capabilities
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Focus aspects of Financial Banking
Financial Business

Core MIS & ATMs

Banking (CBS) Intranet
POS Terminals
and Cash
Electronic dispenser
Banking Card
Corporate
Management
Network
Any Branch Document
Banking Management

Risk Resource
CRM
Management Management

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Benefits of Virtual Banking
 Large satisfied customers and higher
retention
 Scope to attract new customers
 Improve quality and differential
services
 Greater opportunity to cross sell
 Sharing network and Cost Saving
 Increased volumes and profits
 Reduce overall risk with proper MIS

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Benefits to Customer

 More convenience & flexi timings

 Better awareness of products & services

 Up-to-date information on accounts

 Low cost of accessing the accounts

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 BANKS’ IT STRATEGY
 INVESTMENT IN HARDWARE
 ACQUIRING / DEVELOPING SOFTWARE
 TRAINING OF STAFF AT DIFFERENT LEVELS
 SECURITY FOR TRANSACTIONS & INFO
 GLOBAL REACH
 ONLINE BANKING, OUTSOURCING

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 Internet Banking
 Issues of Confidentiality ?
 Hacking and Fraud prone ??
 Scope for failure of Technology ???
 Resultant denial of Services ????

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 Automated Teller Machines
 ATMs or 24 hour Tellers – Electronic
Terminals - allow to bank at any time...
 On-site (near branch) and Off-site ATM
 ATMs facilitate withdrawal/deposit....
 Customer provided with a PIN / Card
 Introduced in India by Foreign Banks
 SWADHAN / SPNS wef Feb 1, 1997
 Introduced in Mumbai by IBA initiative

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SBI’s Mobile ATM in Kerala

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Electronic Funds Transfer (EFT)
 Hosted and operated by the RBI
 Permits fund transfer up to Rs
5 lacs from any account at any
branch of any member bank in any
city to any other account at any
branch of any member bank in any
other city
 RBI acts as the service provider as
well as regulator

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ECS
 Electronic Clearing Scheme (ECS)
operated by the RBI since 1996-97
 Utilises BANKNET and  INFINET
 Facilitates payment from a single
account at a bank branch to any number
of accounts maintained with the
branches of the same or other banks –
Eg., Payment of dividends
 RBI has also launched ECS – Debit for
payment to utility companies like
Telephones, Electricity etc

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SERVICES
 Bill Payment through Electronic
Banking
 Electronic Shopping Mall
 Effecting Personal Investments
through Electronic Banking
 Trading in shares

 Investing in Mutual Funds

 Trade In Derivatives

 IPOs Online

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Customer Relationship
Management (CRM)
 Not a product / service, but a strategy
 Increasing competition among banks
 Customer expectations and demands
 Product development / Service Quality
 Know Your Customer (KYC) guidelines
 Knowledge Management in Banks
 Call Centres, DSAs, Franchisees in Banks
 Two Banking Ombudsman Schemes
 Core Banking Solutions & CRM Packages for
Best Customer Service

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Beware of

 Hacking
 Phishing
 Pharming
 Skimming
 Trojan

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