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Initially, the Indian banking system was domestically oriented at the time of nationalization in 1969. National policy objectives where the guiding force and banks were primarily involved in mobilizing domestic savings, lending funds to specific sectors of the economy and raising resources for financing public deficits. Technology in Indian banking has evolved substantially from the days of back office automation today’s online, centralized and integrated solutions. Once cannot think of ATM, Internet, mobile and phone banking or call centre services without the help of technology?. However, the irony is that most of those products have more of technology and less of banking. Let us look of how banking has changed as a business over the last one decade.

This paper begins with the definition of e- banking, Internet Banking, Mobile banking, ATMs, Debit card and Credit card and electronic fund transfer, Anywhere banking and product and services.


            It is an umbrella term for the process by which a customer may perform banking transactions electronically without visiting a brick-and-mortar institution. The following terms all refer to one form or another of electronic banking: personal computer (PC) banking, Internet banking, virtual banking, online banking, home banking, remote electronic banking, and phone banking. PC banking and Internet or online banking are the most frequently used designations. It should be noted, however, that the terms used to describe the various types of electronic banking are often used interchangeably.

            E-banking are the buzzwords in the global commercial activities today E-banking or electronic banking refers to conducting banking activities with the help of information technology and computers.     

E-banking is a mix of services which include Internet banking, Mobile banking, ATM kiosks, Fund Transfer System, Real Time Gross Settlement (payment & settlement system), Credit/Debit/Smart/Kisan Cards, Cash management services, and Data warehousing, Operational data for MIS and Customer Relationship  Management. Latest innovations in technology like broadband transmission, internet access via mobiles (GSM) and WebTV will further provide impetus to digital revolution.


Further, banks are looking forward to scan the image of a cheque which can be zapped to another bank, into the depository and back to customer’s bank.(BSO,2006) Banking transactions can be carried out 24 hours a day using these methods. In fact concept of Anytime, Anywhere banking is making it easy for customers to access their money more conveniently. It has been established that increasing the role of technology in a service organization can serve to reduce costs and often improve service reliability (Lee, 2002).



The Internet banking is changing the banking industry and is having the major effects on banking relationships. Even the Morgan Stanley Dean Witter Internet research emphasized that Web is more important for retail financial services than for many other industries. Internet banking involves use of Internet for delivery of banking products & services. It falls into four main categories, from Level 1 – minimum functionality sites that offer only access to deposit account data – to Level 4 sites – highly sophisticated offerings enabling integrated sales of additional products and access to other financial services- such as investment and insurance. In other words a successful Internet banking solution offers

ü     Exceptional rates on Savings, CDs, and IRAs

ü     Checking with no monthly fee, free bill payment and rebates on ATM surcharges
Credit cards with low rates

ü     Easy online applications for all accounts, including personal loans and mortgages

ü     24 hour account access

ü     Quality customer service with personal attention

                  Internet banking, sometimes called online banking, is an outgrowth of PC banking. Internet banking uses the Internet as the delivery channel by which to conduct banking activity, for example, transferring funds, paying bills, viewing checking and savings account balances, paying mortgages, and purchasing financial instruments and certificates of deposit. An Internet banking customer accesses his or her accounts from a browser— software that runs Internet banking programs resident on the bank’s World Wide Web server, not on the user’s PC. NetBanker defines a ” true Internet bank” as one that provides account balances and some transactional capabilities to retail customers over the World Wide Web. Internet banks are also known as virtual, cyber, net, interactive, or web banks. To date, more banks have established an advertising presence on the Internet— primarily in the form of informational or interactive web sites—than have created transactional web sites. However, a number of Banks that do not yet offer transactional Internet banking services have indicated on their web sites that they will offer such banking activities in the future. Because Internet banks generally have lower operational and transactional costs than do traditional brick-and-mortar banks, they are often able to offer low-cost checking and high-yield Certificates of deposit. Internet banking is not limited to a physical site; some Internet banks exist without physical branches, for example, Tele bank (Arlington, Virginia) and Bank net (UK). Further, in some cases, web banks are not restricted to conducting transactions within national borders and have the ability to make transactions involving large amounts of assets instantaneously. According to industry analysts, electronic banking provides a variety of attractive possibilities for remote account access, including:

Availability of inquiry and transaction services around the clock;
worldwide connectivity;
Easy access to transaction data, both recent and historical; and
“Direct customer control of international movement of funds without intermediation of financial institutions in customer’s jurisdiction.”


Main Concerns in Internet Banking

            In a survey conducted by the Online Banking Association, member institutions rated security as the most important issue of online banking. There is a dual requirement to protect customers’ privacy and protect against fraud. Banking Securely: Online Banking via the World Wide Web provides an overview of Internet commerce and how one company handles secure banking for its financial institution clients and their customers. Some basic information on the transmission of confidential data is presented in Security and Encryption on the Web. PC Magazine Online also offers a primer: How Encryption Works. A multi-layered security architecture comprising firewalls, filtering routers, encryption and digital certification ensures that your account information is protected from unauthorized access:

Firewalls and filtering routers ensure that only the legitimate Internet users      are allowed to access the system.
Encryption techniques used by the bank (including the sophisticated public    key encryption) would ensure that privacy of data flowing between the             browser and the Infinity system is protected.
Digital certification procedures provide the assurance that the data you receive is from the Infinity system.

Save your time and effort with CIB Internet banking


Your own accounts and your related ones
Credit and Debit cards
Time deposit, Saving certificates
Treasury bonds
Latest transactions of current month
View, print and save your monthly statements (since year 2004)


Between your accounts
To another CIB account (Digital signature required)
To your credit card
To another CIB credit card (Digital Signature required)
To any charity you choose as a fund raising


To change your mailing address
To inquire or complain
To add related account  (Power of attorney, parent/child or account with           different customer number)
 To manage supplementary cards
To dispute credit card
To make External transfer ( Digital signature required )
Digital Signature registration


Stop your credit card
Subscribe in Alerts service (SMS /E mail)
Download CIB forms



             The cash machine or automated teller machine (ATM) as it is more formerly non is the most visible and perhaps most revolutionary element of virtual banking revolution. ATM are self service vendor machine that help the banks to provide round the clock banking services to their customers at convenient  places without visiting to the bank premises. They enable the banks to transact more business by offering various services in cost effective way on one side and to get more customer satisfaction on the other. To avail the ATM services customers are provided with ATM card, which is a small plastic card with magnetic strip, containing information about the name of bank, name of the customer, card number, validity period and signature panel. The magnetic strip contains information about the customer which enables the banks to verify ihe identity when the card is inserted at the slot provided in ATM.


The following functions can be performed on ATM.


Withdrawal of cash, cheques or drafts. the ATM will immediately printout receipt for the same
Deposit of cash, cheques, or drafts,. The ATM will immediately printout receipt for the same.
Updated balance of customer is appeared and screen and will also been printed on a transaction slip.
Transfer of money from one account to another account can be done.
A customer through ATM can obtain many account statements.
A customer can ask cheque book /detail account statement through ATM. these are mailed to customer later on the bank employee.
A customer can maintain joint account for which he can get an additional card on the name of the other joint account holder.
All the branches of bank are providing with an on- site, on-line ATM. A customer can operate his account any ATM of the bank across India, it is a concept a any where banking.


                    P.C Narayan, president of global trust bank , classifies shared ATM networks into two kinds viz. “parent child” and “peer to peer”. A good example of parent child would be a large size bank. Which has a lot of ATMs and which it could be to smaller banks to be a large banking together to build a national ATM network.



            With expansion of technology, it is new possible to obtain financial details from the bank from remote locations. Withdrawals from other stations have been possible due to inter- station connectivity of ATM. The Rangarajan committee had also suggested the in station of  ATM at non- branch location, Airports, Hotels, Railway stations, office computers, Remote banking is being further extended to the customer’s office and home.



The Credit Card holder is empowered to spend wherever and whenever he wants with his Credit Card within the limits fixed by his bank. Credit Card is a post paid card.  Debit Card, on the other hand, is a prepaid card with some stored value. Every time a person uses this card, the Internet Banking house gets money transferred to its account from the bank of the buyer. The buyers account is debited with the exact amount of purchases. An individual has to open an account with the issuing bank which gives debit card with a Personal Identification Number (PIN). When he makes a purchase, he enters his PIN on shops PIN pad. When the card is slurped through the electronic terminal, it dials the acquiring bank system – either Master Card or VISA that validates the PIN and finds out from the issuing bank whether to accept or decline the transactions. The customer can never overspend because the system rejects any transaction which exceeds the balance in his account. The bank never faces a default because the amount spent is debited immediately from the customers account.

What is Inter Bank Transfer?

            Inter Bank Transfer is a special service that allows you to transfer funds electronically to accounts in other banks in India through:

v     NEFT – The acronym “NEFT” stands for National Electronic Funds Transfer. Funds are transferred to the credit account with the other participating Bank using RBI’s NEFT service. RBI acts as the service provider and transfers the credit to the other bank’s account.

v     RTGS –The acronym “RTGS” stands for Real Time Gross Settlement. The RTGS system facilitates transfer of funds from accounts in one bank to another on a “real time” and on “gross settlement” basis. The RTGS system is the fastest possible inter bank money transfer facility available through secure banking channels in India.


            Mobile banking (also known as M-Banking, mbanking, SMS Banking etc.) is a term used for performing balance checks, account transactions, payments etc. via a mobile device such as a mobile phone.

            Mobile banking is a way for the customer to perform banking actions on his or her cell phone or other mobile device. It is a quite popular method of banking that fits in well with a busy, technologically oriented lifestyle. It might also be referred to as M-banking or SMS banking. The amount of banking you are able to do on your cell phone varies depending on the banking institution you use. Some banks offer only the option of text alerts, which are messages sent to your cell phone that alert you to activity on your account such as deposits, withdrawals, and ATM or credit card use. This is the most basic type of mobile banking.

Mobile Payments – The Road Ahead

            Over the years mobile phones have become an indispensable accessory for almost every individual. This ever expanding reach of mobile phones have made them a gadget which can be conveniently used for staying connected with the world, using internet for banking & other purposes, receiving SMS alerts etc. besides of course its basic function, making calls. With the rapid growth in the number of mobile phone subscribers banks have been exploring the feasibility of using mobile phones as an alternative channel of payments.

            Mobile phone provides a way to reach out to people in isolated areas and can help in big way in the financial inclusion. For example in India, more Indians have mobile phones than bank accounts. Mobile Payments can be defined as information exchange between a bank and its customers for financial transactions through the use of mobile phones. Mobile payment involves debit/credit to a customer’s account’s on the basis of funds transfer instruction received over the mobile phones.

            Mobile payments services generally involve the collaboration of banks, mobile payments service providers and mobile network operators (MNOs). The service can also be provided as a proximity payment system, where the transactions are independent of the MNOs. Payment for goods and services via mobile, offered by many companies, use contactless payment over mobile phones to pay for on- and off-street parking in specially demarcated areas. First conceptualized in the 1990s, the technology has seen commercial use in this century in both Scandinavia and Estonia. End users benefit from the convenience of being able to pay for parking from the comfort of their car with their mobile phone, and parking operators are not obliged to invest in either existing or new street-based parking infrastructures.

            32 banks have been given approval to provide mobile banking facility in the country by the Reserve Bank of India. 21 banks have started providing these services. Mobile banking is a secure application, which takes care of end-to-end encryption of data in transit to offer banking information and transactions. Banks are now permitted to offer this service to their customers subject to a daily cap of Rs.50,000/- per customer for both funds transfer and transactions involving purchase of goods/ services. Transactions up to Rs.1,000/- can be facilitated by banks without end-to-end encryption. The risk aspects involved in such transactions are addressed by the banks through adequate security measures.


            Away from home, bills can be paid or money sent to the loved ones or balance enquiries done anytime 24×7!!! That is what State Bank Freedom offers -convenience, simple, secure, anytime and anywhere banking.


Mobile Banking Service over Application/ Wireless Application Protocol (WAP)

            The service is available on java enabled mobile phones over SMS/ GPRS where the user is required to download the application on to the mobile handset. The service can also be availed via WAP on both java and non java phones with GPRS connection.


The following functionalities are available in the application based service/ WAP:

•           Funds transfer (within and outside the bank –using NEFT)

•           Enquiry services (Balance enquiry/ Mini statement) , cheque book request

•           Demat Enquiry Service( (Portfolio value,Request for DIS booklet, Value of holdings, statement of charges, Transaction status etc.)

•           Bill Payment (Utility bills, credit cards, Insurance premium payments) Donations, Subscriptions.

•           M Commerce (Mobile Top Up, Top up of Tatasky, BigTV, SunDirect, DishTV connections and receive recharge pins for DigitalTV/Videocon d2h, Merchant payment, SBI life insurance premium).


Business Rules governing Mobile Banking Service over Application / WAP.

The Mobile Banking Service will be available to all the customers having Current/ Savings Bank Account(Personal segment). The customers will have to register for the services.
Daily transaction limits for fund transfer/ bill/ merchant payment is Rs.50,000/- per customer with an overall calendar month limit of Rs.2,50,000.00 
The service will be carrier-agnostic i.e. all customers can avail the mobile banking service with the Bank irrespective of the service provider for their mobiles.
The service is free of charge. However, the cost of SMS / GPRS connectivity will have to be borne by the customer.

 Mobile Banking Service over USSD (Unstructured Supplementary Service Data)

Mobile Banking Service is now available on non java mobiles without GPRS connection also.
The service is currently available with Aircel, Idea, MTNL (Delhi) Vodafone and Tata Docomo connections.
The service is session based and requires a response from the user within a reasonable time.
The Daily Transaction limit is Rs1000/- per customer with an overall calendar monthly limit of Rs5000/-.


The following functionalities are available in USSD based Service:

Funds transfer (within the bank)
Enquiry services (Balance enquiry/ Mini statement)
Mobile Top up.

Gift Cheques

            Need to give a gift but do not know what would be appreciated by the receiver? Purchase our attractive Gift Cheques available at all our branches in denominations of Rs 101/-, 201/-, 501/- and 1001/-. Gift Cheques do not attract any charges and come with an attractive free envelope.Encashable at par at all SBI branches, with no identification requirements. No time limit for encashment. Purchases can be made in bulk.


            Information technology has played a vital role in the advancement of banking system. The reach of Indian banking to every individual is possible because of the computerization process adopted by banking sector. Information technology has not only simplified the operation but it has  also given a great comfort an individual who does not have a good knowledge of IT but need to  access banking in an optimum manner.

            In can be conclude that more introduction of IT alone will not be sufficient to bring necessary performance improvement  and get the competitive edge but intelligent people are required to use such intelligent  tools. They even though IT management is a challenge flow in future banking scenario, marketing mix technology is going to be the challenge.



Books and Journals:                                                                                                       

1) Asdas & Barosa; “Banking sector Reforms- towards new face of Indian Banking. The management Accountant. ICW AI WAY 2001.

2)Sugan C. Jain, “E-Banking”, 2006.

3) Abhay Jain and B S Hundal, “Barriers in Mobile Banking adoption in India”, Aug- 2006, Vol.v, No.3, p:8.

4)Premkumar.N B and Esther Gnanapoo.J “E-Banking the essential need of today” Kisan World, March 2008, Vol.35,No.3, PP:17-19.

5)Vasudevan V.,”Theory of banking”, S.Chand & Company Ltd., Delhi, Nov -1986 P.43.

6)”A study of the Trends and issues in implementation of E- Banking,”Dr.Meena Mathur, Zakiya Khan.






5)tech quest 2003

6)IBA- Indian year Book 2001


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