PREETHI.A II MBA

BANKING & INSURANCE

TECHNOLOGY UPGRADATION AND ITS

IMPACT ON BANKS

IT and EFT – Twin pillars of modern banks.Round the clock round the week routine.Various committees are:Rangarajan Committee in early 1980s.Rangarajan committee at the end of 1980.Saraf group-work in early 1990.Vasudevan working group at the end of 1990.Barman working group in early 2000.

INTRODUCTION

Inadequate Bank automation.Not so strong commercially oriented inter-

bank platform.Lack of electronic payment system.Inadequate telecom infrastructure.Inadequate marketing effort.Lack of clarity on legal issues.Lack of data warehousing network.

REASONS

Quick credit on an objective basis.Reasonable rates.A friendly supporting system.Easy access to wide range of services.High quality customer service.

NEED FOR TECHNOLOGICAL UPGRADATION

Electronic clearing system.Cheque truncation.Electronic tax collection.Electronic bill payment.Corporate interest and dividend payments.Salary and pension payments.

INITIAL SET OF SERVICES

Unique identification for bank account holders.

Storage of land records.Land use data on electronic media.Storage of loan utilisation.Storage of repayment data.

REQUIREMENT OF DATA WAREHOUSES

Headed by Shri. A.Vasudevan, Executive Director,RBI.

TERMS OF REFERENCE:To suggest necessary legislative changes on:Encryption of PSTN lines.Admission of electronic files as evidence.Treating electronic funds transfer.Record keeping.

COMMITTEE ON TECHNOLOGY UPGRADATION IN THE BANKING SECTOR

To recommend for development of communication network.

To suggest about ways to bring computerization.

To work out for development on WAN.To examine methods on effecting

technological upgradation.To recommend for data warehousing.To recommend guidelines on outsourcing.To recommend on other related issues.

CONTINUED……

The report was submitted on July 17, 1999.Issues relating to inter-city & intra-city

communication.Guidelines on the types of services that can

be outsourced.Computerization of government accounts.Issues relating to data warehousing and data

mining.Proposals for separate enactments &

amendments.

REPORT OF THE COMMITTEE & ITS LAYOUT

IMPACT OF TECHNOLOGY IN BANKING SECTOR

Liberalisation has brought several changes to the service sector.

Introduction of information technology in capital market.

The internet is the major impact.Web is important for financial services to

retail customers.

CHANGE BANKING

MECHANISM

It is a delightful gift for the Indian market.Gives relief.Attractive.Bow now pay later.Can be used more than once.

PLASTIC MONEY

INTERNET BANKING

Booming market for mobile phones and mobile services.

It allows banking transactions.

MOBILE BANKING

Also called as Kissan Credit Card scheme.Farmers gain more agricultural input.In 2000, ICICI Bank setup Internet Kiosks.

LAND BANKING

Information and communication is important arrival.

Banking industry is growing rapidly.Growth is strongly supported by technology.

CONCLUSION