1Compiled by KSSubbaRaj

BANKING DOMAINBANKING DOMAIN

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Domain is type of Environment.

Domain knowledge is that valid knowledge used to refer to an area of human Endeavour, an autonomous computer activity, or other specialized discipline. Domain knowledge is important, because it usually must be learned from software users in the domain (as domain specialists/experts), rather than from software developers. Expert’s domain knowledge (frequently informal and ill structured) is transformed in computer programs and active data.

What is Domain?

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An establishment authorized by a government to accept deposits, pay interest, clear checks, make loans, act as an intermediary in financial transactions, and provide other financial services to its customers.

A financial institution that is licensed to deal with money and its substitutes by accepting time and demand deposits, making loans, and investing in securities. The bank generates profits from the difference in the interest rates charged and paid.

A corporation empowered to deal with cash, domestic and foreign, and to receive the deposits of money and to loan those monies to third-parties.

What is Banking?

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• The first banks were probably the religious temples of the ancient world, and were probably established in the third millennium BC. Banks probably predated the invention of money. Deposits initially consisted of grain and later other goods including cattle, agricultural implements.

• The first bank in India, though conservative, was established in 1786. From 1786 till today, the journey of Indian Banking System can be segregated into three distinct phases.

• 1. Early phase from 1786 to 1969 of Indian Banks• 2. Nationalization of Indian Banks and up to 1991 prior to

Indian banking sector Reforms.• 3. New phase of Indian Banking System with the advent of

Indian Financial & Banking Sector Reforms after 1991

Banking History

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First Bank in the World: "Bank" of Rome. The Jesuits were founded on August 15,

1534, and LIEola was officially commissioned to reorganize the almost bankrupt "Bank" of Rome in 1540.

First Bank in INDIA:1. A person named Ramakishen Dutt set up the first Bank of

India in Calcutta (now Kolkata) in 1828.2. The second Bank of India was incorporated in London in

the year 1836 as an Anglo-Indian bank.3. The third bank named Bank of India was registered in

Bombay (now Mumbai) in the year 1864.

First Bank?

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Largest Bank In the World: The Royal Bank of Scotland was incorporated in 1727. The Royal Bank of Scotland is one of the oldest banks in the U.K. and it is one of the largest financial services providers in the world.

Largest Bank in India: SBI: It began with the establishment of the Bank of Calcutta in Calcutta, on 2 June 1806. The bank was redesigned as the Bank of Bengal, three years later, on 2 January 1809. It was the first ever joint-stock bank of the British India, established under the sponsorship of the Government of Bengal. Subsequently, the Bank of Bombay (established on 15 April 1840) and the Bank of Madras (established on 1 July 1843) followed the Bank of Bengal. These three banks dominated the modern banking scenario in India, until when they were amalgamated to form the Imperial Bank of India, on 27 January 1921.

Largest Banks?

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Types of Banks?Core Banking: Functions include deposit accounts, loans, mortgages, and payments. These services are available through bank branches, ATMs, and websites.Core banking is a general term used to describe the services provided by a group of networked bank branches

Retail Banking: Retail banking in India has fast emerged as one of the major drivers of the overall banking industry and has witnessed enormous growth in the recent past. The Retail Banking Report encompasses extensive study & analysis of this rapidly growing sector. Investment Banking: A specific division of banking related to the creation of capital for other companies. Investment banks underwrite new debt and equity securities for all types of corporations. Investment banks also provide guidance to issuers regarding the issue and placement of stock.

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Types of Bank AccountsTypes of Bank Accounts - Sb a/c : Savings bank account - CC a/c : Cash credit account - CA a/c : Current account - Demat account - NRE A/c : Non Residential (external) rupee account - NRO A/C : Ordinary Non-Resident account - FCNR A/c : Foreign Currency Non Resident Account - Salary Account - Recurring deposit account - Overdue account : OD a/c - Fixed deposit account - Proprietorship account - Partnership account - Company account

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WHY TECHNOLOGY IN BANKS?• TO TRANSFORM FINANCIAL SERVICES INDUSTRY IN

THE NET-WORKED WORLD. BANKS TO BE CUSTOMER CENTRIC PROVIDE SERVICES / PRODUCTS ACROSS A RANGE OF CHANNELS TO BE FUTURISTIC AND HAVE “TIME” VALUE IN ALL ITS DEALINGS WITH CUSTOMERS.

Many Benefits of Technology Increased operational efficiency, profitability & productivity Superior Customer Service Multi-channel, real-time transaction processing Better Cross-Selling ability Improved management / accountability Operational effectiveness, internal efficiency Minimal transaction costs

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The ability to easily search across and retrieve relevant information.

A project management system based on complete project lifecycle.

A resource management system which improve linkages

Benefits to Customer More convenience & flexi timings Better awareness of products & services Up-to-date information on accounts Low cost of accessing the accounts

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ROLE OF IT IN BANKING INDUSTRYROLE OF IT IN BANKING INDUSTRY

1). Technology has opened up new markets, new products, new services and efficient delivery channels for the banking industry. Online electronics banking, mobile banking and internet banking are just a few examples.

2). Information Technology has also provided banking industry with the wherewithal to deal with the challenges the new economy poses.

3). It is information technology which enables banks in meeting such high expectations of the customers who are more demanding and are also more techno-savvy compared to their counterparts of the yester years.

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IT has been providing solutions to banks to take care of their accounting and back office requirements. This has, however, now given way to large scale usage in services aimed at the customer of the banks. IT also facilitates the introduction of new delivery channels--in the form of Automated Teller Machines, Net Banking, Mobile Banking and the like.

The IT revolution has set the stage for unprecedented increase in financial activity across the globe. The progress of technology and the development of world wide networks have significantly reduced the cost of global funds transfer.

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Internet Banking (E-Banking)Internet Banking (E-Banking)Internet banking (or E-banking) or Online 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. In internet banking system the bank has a centralized database that is web-enabled. All the services that the bank has permitted on the internet are displayed in menu.

Any service can be selected and further interaction is dictated by the nature of service. The traditional branch model of bank is now giving place to an alternative delivery channels with ATM network. Once the branch offices of bank are interconnected through terrestrial or satellite links, there would be no physical identity for any branch. It would a borderless entity permitting anytime, anywhere and anyhow banking.

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ObjectivesObjectives• E-Banking is one of the fastest developing trends in Indian

Banking and it is poised to take the banking sector a notch higher. It divided into

• Automatic Teller Machines(ATMs)

• Tele Banking• Internet Banking• Mobile Banking or M-Banking or SMS Banking• Electronic Funds Transfer• Electronic Clearing System• Online Banking• Plastic Money

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Automated Teller MachineAutomated Teller Machine• First ATM in the World: Automated Teller Machine or

Automated Banking Machine (ABM):World's first ATM, invented by John Shepherd-Barron, was installed by Barclay's Bank in North London on June 27, 1967.

• First ATM in India: HSBC (1987) was the first bank to introduce the ATM concept in India.

• An Automated Teller Machine (ATM), commonly called a cash point and a hole in the wall in UK English after the trademark of the same name, is a computerized telecommunications device that provides the clients of a financial institution with access to financial transactions in a public space without the need for a cashier, human clerk or bank teller. ATMs are known by various other names including automatic banking machine, cash machine

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Telephone bankingTelephone bankingTelephone banking is a service provided by a financial

institution, which allows its customers to perform transactions over the telephone. Most telephone banking services use an automated phone answering system with phone keypad response or voice recognition capability. To guarantee security, the customer must first authenticate through a numeric or verbal password or through security questions asked by a live representative.

Telephone banking is Two Kinds:

1. Public Enquiry: General Information about banking services can be obtained by customers and non customers. Example Call Centers

2. Private Enquiry: This relates to account specific information and can be accessed only by the account holder. Example CID, PIN.

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Mobile Banking or SMS BankingMobile Banking or SMS Banking• Mobile banking (also known as M-Banking, mbanking, SMS

Banking) is a term used for performing balance checks, account transactions, payments, credit applications and other banking transactions through a mobile device such as a mobile phone or Personal Digital Assistant (PDA).

• The earliest mobile banking services were offered over SMS. With the introduction of the first primitive smart phones with WAP support enabling the use of the mobile web in 1999, the first European banks started to offer mobile banking on this platform to their customers.

• Mobile banking has until recently (2010) most often been performed via SMS or the Mobile Web. Apple's initial success with iPhone and the rapid growth of phones based on Google's Android (operating system) have led to increasing use of special client programs, called apps, downloaded to the mobile device.

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Mobile Banking can be said to consist of three inter-related concepts: Mobile Accounting Mobile Brokerage Mobile Financial Information Services

Mobile Banking Services 1.Mini-statements and checking of account history 2.Alerts on account activity or passing of set thresholds 3.Monitoring of term deposits 4.Access to loan statements 5.Access to card statements 6.Mutual funds / equity statements 7.Insurance policy management

Mobile Banking Services

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8.Pension plan management9.Status on cheque, stop payment on cheque10.Ordering cheque books11.Balance checking in the account12.Recent transactions13.Due date of payment (functionality for stop, change and deleting of payments)14.PIN provision, Change of PIN and reminder over the Internet15.Blocking of (lost, stolen) cards

Mobile Banking Services

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Electronic Funds Transfer• Electronic funds transfer or EFT is the electronic exchange or transfer

of money from one account to another, either within a single financial institution or across multiple institutions, through computer-based systems.

The term is used for a number of different concepts: Cardholder-initiated transactions, where a cardholder makes use of a

payment card Direct deposit payroll payments for a business to its employees,

possibly via a payroll service bureau Direct debit payments, sometimes called electronic checks, for which

a business debits the consumer's bank accounts for payment for goods or services

Electronic bill payment in online banking, which may be delivered by EFT or paper check

Transactions involving stored value of electronic money, possibly in a private currency

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Electronic Clearing ServiceElectronic Clearing ServiceIt is a mode of electronic funds transfer from one bank account to another bank account using the services of a Clearing House. This is normally for bulk transfers from one account to many accounts or vice versa. This can be used both for making payments like distribution of dividend, interest, salary, pension, etc., by institutions or for collection of amounts for purposes such as payments to utility companies like telephone, electricity, or charges such as house tax, water tax, etc., or for loan installments of financial institutions/banks or regular investments of persons.There are two types of ECS called ECS (Credit) and ECS (Debit). ECS (Credit) is used for affording credit to a large number of beneficiaries by raising a single debit to an account, such as dividend, interest or salary payment. ECS (Debit) is used for raising debits to a number of accounts of consumers/account holders for crediting a particular institution.

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Plastic MoneyPlastic Money Plastic money are the alternative to the cash or the standard 'money'.

Plastic money is used to refer to the credit cards or the debit cards that we use to make purchases in our everyday life. Plastic money is much more convenient to carry around as you do not have to carry a huge some of money with you. Nowadays even developing countries like India are encouraging the use of these plastic money more than cash due to these reasons. Furthermore these credit and debit cards also have plastic used in their making and that is where the name 'plastic money' has originated from.

Different Types of Bank Card Smart Card Debit Card Credit Card Most Bank Cards are Chip and PIN Cards. To use them you will need

the correct PIN. Each card has a different PIN - a secret number just for you.

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Smart Cards: Many companies provides a range of smart card solutions and primarily works to provide solutions for cashless catering in Education – schools, colleges, universities and businesses, and also to provide turn-key loyalty solutions for all sectors of business, including retail, salon & beauty and the restaurant and hotel industry. Unlike standard credit, debit and loyalty cards, that have the ordinary magnetic strip (swipe type of card) – smart cards use microprocessor chips which are available in 8, 16, and 32 bit architecture.

Debit Cards: If you have a Debit Card you can take out money from a cash machine AND you can use your card to pay for things such as shopping at the supermarket. This card is the one you are most likely to get with a Current Account. A debit card (also known as a bank card or check card) is a plastic card that provides the cardholder electronic access to his or her bank account/s at a financial institution.

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Credit Cards: Credit Cards A Credit Card is a Bank Card with which you can pay for items from shops and, at the end of the month, you will be sent a bill. A credit card is a small plastic card issued to users as a system of payment. It allows its holder to buy goods and services based on the holder's promise to pay for these goods and services.

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