Internet banking is a Self-service channel through which the customer will be interesting with the branch for Transacting business and seeking information. The channel is an extremely comprehensive product for both retail and corporate customers. It has acquired real-time transaction processing capability and has been supporting the business initiatives of the bank in the area of bill payments, IT application money receipts, railway ticket bookings, credit card payments, insurance premium payments etc.
IMPACT OF E-BANKING ON RURAL ECONOMY
In underdeveloped countries like India, there was a tendency on the part of people to invest their savings in unproductive channels like real estate, gold and silver etc. The socio-economic setup was responsible for this. The reason why people invested in hoarded wealth was that they could be converted into money whenever required. The savings of the land owners or rent earners were directed into unproductive expenditure and conspicuous consumption. This class of people had the power to save but lacked the will to save. The savings of peasants were invested in bullion or in lending money to other peasants. Some of them invested their savings in cattle. But cattle die and become dry. The savings of middleclass people (wage earners and salaried persons) were used for the education of their children, for building residential houses and for meeting unexpected circumstances. The above people were not aware how to utilize their savings for socially useful purposes. To discourage such hoarding and unproductive expenditure, rural branches of banks were opened to mobilize the savings of rural people. First, they were only engaged in their traditional banking of accepting and lending of money. Then only they were diversified their activities into new fields of operations like merchant banking, leasing, housing finance, mutual funds, venture capital etc. They had introduced a number of innovative schemes for mobilizing deposits. In addition to the above, they were providing valuable services to the rural customers by way of collecting cheques, bills, purchasing securities on behalf of customers, issuing drafts, travellers cheques, gift cheques, accepting valuable for safe custody. Now the rural customers are encouraged to move from the current paper based system of notes, cheques, statements and bank-tellers to the complete impersonal electronic banking system.
CONCLUSION
E-banking is a successful strategic weapon for banks to remain profitable in a volatile, and competitive marketplace of today. Clearly, despite the threats posed by non-bank financial intermediaries, there is enormous opportunity for far-sighted banks to reap the rewards available from e-banking. If banks are to retain their competitiveness, they must focus on customer retention and relationship management, upgrade and offer integration and value added services, especially in the consumer-banking sector. Technology has indeed transformed the Indian banking sector, but the technology itself has undergone a sea-change. It has been an arduous yet learning journey for the Indian banking system which has passed the milestones of Automated Ledger Posting Machines, the mainframes, the minicomputers, microcomputers and PCs. In fact, the banking system has mirrored the developments in the computer Industry. Delivery channel developments came next, with the ATM changing banking rules and forming the base for innovative channel developments such as Internet banking and the recent ones to enter the field-call centres and mobile banking. Now, the current and infact lasting trend will be that of centralization through implementation of centralized banking solutions which will integrate all banking applications, processes and delivery channels. This has in turn, led to a surfeit of backend developments such as security tools, networking, data warehousing and CRM. Put simply, a bank has come to rely on technology like never before. In the past, banking was influenced by technology, now it seems technology is influenced by banking.
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