SRINIVASA INSTITUTE OF

TECHNOLOGY & SCIENCE

Electronic banking
Contents:
 Introduction
 History of E-Banking
 Banking in India
 What is E Banking ?
 E-Banking
 Electronic Delivery Channels
 Benefits of E-Banking
 Advantages & Disadvantages of E-Banking
 Online Banking Frauds
 Pre cautions to be taken
 Services/Transactions
 Conclusions
 Introduction
 E-Banking or Electronic is a major innovation in
the field of Banking.
 Earlier Banking was conducted in a very
traditional manner ,there were no such
innovations.
 Information revolution led to the evolution of
internet, which lead to E-commerce continued by
evolution of E-Banking.
 History of E-Banking
 E-Banking History dates back to 1980s.
 The term online became popular in the late ‘80s and
referred to the use of a terminal, keyboard and TV (or
monitor ) to access the banking system using a phone
line.
 Stanford federal credit union was the first who offer
online internet banking services to all of its members in
1994.
 Later on snapped up by other banks like well Fargo, chase
Manhattan and security First Bank.
 Banking in India
 Started in the year 1786 with “The General Bank of
India” being the first.
 Reserve Bank of India came in 1935.Became the central
banking authority in 1965.
 Banking companies Act passed in 1949.
 Formation of State Bank of India in 1955.
 Nationalization of 14 major banks in 1969.seven more in
1980.
 What is E Banking ?
 Internet banking (or E-banking) means any user with a
personal computer and a browser can get connected to his
bank’s website to perform any of the virtual banking
functions.
 The term ”electronic banking” or “e-banking “covers both
computer and telephone banking.
 In other words it is said that it is updated ‘on-line, real
time’. the system is updated immediately after every
transaction automatically.
 E-Banking
 Modern banking is virtual banking .
 Virtual Banking means a customer cannot see the bank but
with the help of technology he can conduct the banking
activities anywhere in the world.
 The major types of virtual banking services includes:
1. Automated Teller Machine(ATMS)
2. Smart cards
3. Phone banking
4. Home banking
5. Internet banking
 Electronic Delivery channels
 Today’s banks are offering various delivery channels to
provide products & services to their customers.
 The IT has helped banks in increasing the range of their
products & services and also in marketing them more
effectively
 The major channels are:-
1. ATM’s
2. smart cards
3. Telebanking
4. Internet banking
Automated Teller Machines(ATMs)
 ATMs are widely used electronic channels in banking.
 It is a computer controlled device at which the customers
can make withdrawals , check balance without involving
any individuals.
 To use this system customers are given a plastic card
which contains the customer’s name & account no.
 Customer is given a pin number. whenever he wants to use
it he needs to enter pin number.
 Mostly ATMs are nearer to branches but nowadays ATMs
are available at places like malls, theaters, stations etc.
Smart Cards
 It is a chip based card(micro chip containing monetary
value)
 When a transaction is made using the card, the value is
debited & balances comes down.
 It is used for making purchases without the need of any
pin.
 It is a powerful card which carries out functions of ATM
card, credit card, Debit card.
Tele-Banking
 It means banking over phone.
 Mainly used for marketing banking services.
 A customer can do entire Non-Cash related banking over
phone anywhere at anytime.
 With fall in mobile phone rates mobile banking will
emerge as one of the most cost effective delivery
channel.
Internet banking
 It has helped in banking at the click of a mouse.
 In internet banking, customer of a bank with a pc can log
on to the bank website & conduct basic functions.
 Benefits of E-Banking
 Any time banking
 Any where banking
 Cash free banking
 Reduction in cost of transaction
 Easy to make utility payments
 On –line purchases
 Competitive advantage
 Unlimited network
 Lesser work and
 Lesser chances of fraud
 Better profitability
Advantages Disadvantages
 Check account balance  Need an account with an
and track recent account internet service
activity provider(ISP)
 Transfer money between  Security concerns, like
accounts ‘hackers’ accessing your
 Authorize electronic bill bank accounts
payments  Original setup for bill
 Issue stop payment paying time is time-
requests consuming but will
ultimately be a time-saver
 Apply for auto, home
equity ,student ,or  Must have a basic
personal loans computer skills and
internet knowledge
 Receive investment
product and service  Must be comfortable using
information a computer
Online banking frauds

 While online banking has

been around for many
years, but no cases of
fraud have been reported
until recently. Since the
beginning of the year
2004,reports of fraud
cases nearly explode.
 Pre cautions to be taken
 Customers should never share personal information like
PIN numbers, passwords etc with anyone ,including
employees of the bank.
 PIN or Password mailers should not be stored , the PIN and
passwords should be changed immediately and memorized
before destroying the mailers.
 Customers are avoided not to provide sensitive account
related information over unsecured e-mails or over the
phone.
 Take simple precautions like changing the ATM PIN and
online login and transactions passwords on a regular basis.
 Ensure that the logged in session in properly signed out
 Services/Transactions
 Answering routine queries
 Bill payment service
 Electronic Fund transfer(ETF)
 Railway pass
 Recharging your prepaid phone
 Shopping
 conclusion
 With all the benefits of having the banking services
accomplished from anywhere that internet exists.
 It is available and with the availability of having the
services 24/7.