Internet Banking

Internet Banking

In the days of virtualisation where working mothers and travelling sales-team prefer to use flexi-time and remote jobs profile; Internet is being adopted as a parallel medium of communication, transaction, and social networking. Internet banking is fast gaining momentum across the globe for its convenience and ease of conducting transactions at a speed and service levels never dreamt of, a decade ago.

In-spite of its multiple advantages, there is a need to step back and re-think on perceptions it carries with the masses. Is Internet Banking truly replacing the layers of branch banking in a big way? Is Internet Banking a definitive future of how world people will transact over net?

There are enough evidences of Internet Banking gaining considerable adoption in developed and to a lesser extent in developing countries. However ample evidence exist to suggest that Internet banking has been highly is accepted in only specific line of services and yet global bankers have to fight a fierce battle when Internet Banking will be a truly serious and parallel banking channel, complementing offline banking in a big way.

Developing and deploying Internet Banking is a extremely tough call for a modern day banker. At one side the cost and efforts of maintenance of e-banking infrastructure may not necessarily justify the benefits to every bank. And at the same time, intangible cost of not providing internet banking channel is also huge and may affect the opportunities loss for banks. Having said that, in today’s context, providing full-fledged Internet banking services is more of “when and not if” and the benefits are comparable to “chicken or egg” theory”.

In the first generation of Internet Banking, i.e. pre Y2K era, banks in the developed world provided basic facilities such as view balance, e-statements, check-book request, stop payment instructions, Electronic bill payment (EBP) etc. In Post Y2K era banks aggressively adopted various services such as Electronic Bill Presentment and payment (EBPP), customized reporting, account aggregation over multiple bank accounts, Investment banking, also portfolio / investment management, comprehensive money management, and trade finance etc. Y2k was also an era when few “Internet only” banks were established, and out of which these only Japanese have truly survived by now. Rest of the world is struggling to keep this “internet only” concept alive.

In the present regime of 2006 and beyond, the banks are concentrating on targeting the incremental service-level in online banking value-chain e.g. developing creative