Technology in banks

Prabhav Jain | Ultikitab | ultikitab@gmail.com

Benefits of Technology
in Banking
Increased operational efficiency,
profitability and productivity
Superior customer service
Multi-channel and real-time
processing of transactions
Better cross-selling ability

Improved management and
accountability
Efficient NPA and risk
management
Minimal transaction costs
Improved financial analysis
capabilities
Benefits of Technology in
Banking

 Some of the core banking software products used by
leading banks are:
• ICICI bank, AXIS bank and
ABN Amro
Finacle by Infosys
• Syndicate bank and Union bankFlexcube by I-flex
• Central Bank of India, Allahabad
bank, OBC and UCO
Banc 724 by
Zenith Infotec
• State Bank of India group
Bancs Core
Banking by TCS

Automated Teller Machine (ATM), debit card, credit card, smart card
or virtual card
Internet banking
banking at the doorstep of the customer
Electronic payment of utility bills
Website with all the information that a customer would need
Transfer of funds by National Electronic Fund Transfer (NEFT)/Real
Time Gross Settlement (RTGS) by leveraging technology
Credit Information Bureau (India) Ltd. (CIBIL) and credit report on
defaulters
Cheque clearing system using Magnetic Ink Character Recognition
(MICR)
Core Banking Solution (CBS) paving way for ‘Anywhere Banking’ and
‘Single Window’
Business Process Re-engineering (BPR) for operational excellence
New Products in Banking Leveraging
Technology

GLOBALISATION
OF BANKING
 Globalization has emerged as a
prime mover in the Indian
banking system.
 This has come about as a result
of the policy of liberalization and
opening up of banking and other
sectors pursued after 1991 in
India.
 Foreign banks that wish to set up
their offices/branches in India
have been granted licenses by
RBI on liberal and on reciprocal
basis.
 Similarly, Indian banks are also
opening their offices/branches
abroad, particularly in countries
whose banks have opened offices
in India

SATELLITE BANKING
 Satellite banking is an upcoming technological
innovation in the Indian banking industry.
 It is expected to help in solving the problem of weak
terrestrial communication links in many parts of the
country.
 The use of satellites for establishing connectivity
between branches will help banks to reach rural and
hilly areas in a better way, and offer better facilities,
particularly in relation to electronic funds transfers.

TECHNOLOGICAL
DEVELOPMENT
 With the advancement of technology and the birth of
competition, banks are in the race of becoming the
best in the country.
 The advancement in the technology has helped the
banks to reduce the workload.
 There are so many activities, which are taken over by
machines. Employees are no more loaded with paper
work.

PHONE BANKING
 Pick up the phone to access a host of Bank services, day or
night.
 Phone banking channels function through an Interactive Voice
Response System (IVRS) or tele-banking executives of the
banks.
Online banking
Online banking (or Internet banking) is a term used
for performing transactions, payments etc. over the
Internet through a bank, credit union or building
society's secure website.

Features of online banking
Bank statements.
Electronic bill payment
Funds transfer.
Loan applications and transactions,
such as repayments
Account aggregation

REAL TIME GROSS SETTLEMENT
 RTGS is a large value funds transfer system .
 Transfer of money takes place from one bank to another on a “real
time” and on “gross basis”.
 Money can be transferred only to those branches in which RTGS is
enable
❖ Benefits of RTGS
 full value of individual
 Real time immediate value transfer
Features
1. No bundling up of transactions,
2. No netting
3. No deferral of final settlement

Bancassurance
 Bancassurance is the term used to describe the sale
of insurance products in a bank.
 The word is a combination of "banque or bank" and
"assurance" signifying that both banking and
insurance is provided by the same corporate entity.
 Banks gives you peace of mind with Bancassurance.
 One receive coverage and save money at the same
time. You can choose the right option which
benefits you the most.

Core banking solutions(CBS)
 Core banking (stand for "centralized online real-time exchange")
is a banking services provided by a group of networked bank
branches
 Here customers may access their bank account and perform
basic transactions from any of the member branch offices.
 Larger businesses are managed via the Corporate
banking division of the institution.
Electronic data interchange (EDI)
It facilitates computer to-computer exchange of
electronic documents (such as purchase orders,
advance shipment notices and without human
intervention or human readable (paper or electronic
documents)..

Electronic fund transfer (EFT)
 Electronic Funds Transfer (EFT) is a system of transferring money
from one bank account directly to another without any paper
money changing hands.
 It is used for both credit transfers, such as payroll payments, and
for debit transfers, such as mortgage payments.
 The growing popularity of EFT for online bill payment is paving the
way for a paperless universe where checks, stamps, envelopes,
and paper bills are obsolete.
Benefits of EFT
 reduced administrative costs
 increased efficiency
 simplified bookkeeping
 greater security

Electronic clearing system
 ECS is an electronic mode of funds transfer from
one bank account to another.
 It can be used by institutions for making payments
such as distribution of dividend interest, salary,
pension, among others.
 It can also be used to pay bills and other charges
such as telephone, electricity, water.
 For making equated monthly installments
payments on loans as well as SIP investments. ECS
can be used for both credit and debit purposes.

Technology in banks

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