Impact of Computers in the Banking Sector

THE IMPACT OF COMPUTER IN THE BANKING SECTOR In the 21st century, more and more people are using the computer and banking system to manage their personal and business finances. Indeed, the blending of computer and banking has made the overall management of household and business finances far easier than it ever has been at any point in history. With the computer and banking, it is simple to keep track of various types of financial accounts. Indeed, all you need to do is log onto the computer and quickly access the program for computer and banking.

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The Internet has also broadened the scope of computer and banking services that are now available on both the personal and business level when it comes to finances. The Internet allows a person to be in direct contact, if you will, with his or her accounts through computer and banking systems on the World Wide Web. A person now can readily pay bills and undertake other financial tasks via the Internet. The Internet truly has brought about a whole new age when it comes to the computer and banking. In the future, most experts estimate that the vast majority of transactions involving the payment of bills will take place via the Internet.

No longer will be have to mess around with writing checks and mailing in bill payments using land mail services. As an aside, most financial institutions have taken significant steps to ensure and provide for the security of their customers and their customers’ money when it comes to online computer and banking. Initially, people were reserved about the prospect of using online computer and banking services for fear that their accounts would be improperly accessed. While security measures are not flawless, they have become significant in recent years and do provide a hefty lot of protection to the consumer and the public.

With computers, access is fast, convenient, and available around the clock. Furthermore, customer’s application for electronic banking facilities is expanding as the cost savings on transactions over the internet are significant. The chances and threats that the internet symbolizes is no longer news to the present day banking sector. No traditional bank would dare face investment analysts without an Internet strategy. Moreover, business success is not guaranteed by a detailed and thoughtful approach to the internet.

The main intention behind the commencement of electronic banking services is to provide the customers with an alternative that is more responsive and with less expensive options. With options just a click away, customers have more control than ever. Their expectations are usability and real-time answers. They also want personal attention and highly customized products and services. This research intends to see how electronic banking has improved the efficiency and effectiveness in the bank, take a look at the security measures on ground and also proffer a solution that can eradicate fraud in electronic banking.

This field is heavily reliant on computers. The banking industry could not function without the speed and exactness that computers deliver. Computers have aided customers view real time balances and transactions on your account. With features like bill payment, you can settle bills such as Multichoice conveniently. It has also enabled faster transfer of funds between accounts. With the existence of computers, you can initiate and conclude payment from the comfort of your home or office to your suppliers, contractors or employees.

With the emergence of computers in the banking industry, most of the large banks now offer fully secure, fully functional online banking for free or for a small fee. Some smaller banks offer limited access or functionality; for example, clients may be allowed to view account balance and history but not initiate transactions online. As more banks succeed online and more customers use their sites, fully functional online banking likely will become as commonplace as automated teller machines. Computers in the banking industry brought along the following advantages: Reducing cost – virtual banks pass the money they save on overhead like buildings and tellers along to you in the form of higher yields, lower fees and more generous account thresholds. • Convenience – unlike your corner bank, online banking sites never close; they’re available 24 hours a day, seven days a week, and they’re only a mouse click away. • Ubiquity – if you’re out of state or even out of the country when a money problem arises, you can log on instantly to your online bank and take care of business, 24/7. Transaction speed – online bank sites generally execute and confirm transactions at or quicker than ATM processing speeds. • Efficiency – you can access and manage all of your bank accounts, including IRAs, CDs, even securities, from one secure site. • Effectiveness – many online banking sites now offer sophisticated tools, including account aggregation, stock quotes, rate alerts and portfolio managing programs to help you manage all of your assets more effectively. Most are also compatible with money managing programs such as Quicken and Microsoft Money.

For banks, it can provide a cost effective way of conducting business and enriching relationship with customers by offering superior services, and innovative products which may be customized to individual needs. For customers it can provide a greater choice in terms of the channels they can use to conduct their business, and convenience in terms of when and where they can use E-banking. The evolution of electronic banking (E-banking) started with the use of automatic teller machines (ATMs) and has included telephone banking, direct bill payment, electronic fund transfer and online banking.

According to some, the future direction of E-banking is the acceptance of mobile telephone (WAP-enabled) banking and interactive-TV banking. However, it has been forecast by many that online banking will continue to be the most popular method for future electronic financial transactions. Electronic funds transfer (EFT), refers to the computer-based systems used to perform financial transaction electronically. The term is used for a number of different concepts including electronic payments and cardholder-initiated transactions, where a cardholder makes use of a payment card such as a credit card or debit card.

The rapid advancement in Information and Communication Technology (ICT) has had a profound impact on the banking industry and the wider financial sector over the last two decades and it has now become a tool that facilitates banks’ organizational structures, business strategies, customer services and other related functions. The recent “IT revolution” has exerted far-reaching impacts on economies, in general, and the financial services industry, in particular.

Within the financial services industry, the banking sector was one of the first to embrace rapid globalization and benefit significantly from IT development. The technological revolution in banking started in the 1950s, with the installation of the first automated bookkeeping machines at banks. This was well before the other industries became IT savvy. Automation in banking became widespread over the next few decades as bankers quickly realized that much of their labor-intensive information-handling processes could be automated with the use of computers.

The advent of ATMs helped both to improve customer convenience and reduce costs, as before ATMs, withdrawing funds, accounts inquiries and transferring funds between accounts required face-to-face interaction between bank staff and customers. Overall, technological innovation has brought about the speedy processing and transmission of information, easy marketing of banking products, enhancement of customer access and awareness, wider networking and, regional and global links on an unprecedented scale.

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