This paper develops and tests a model to examine the effects of information technology Information technology adds value for business organizations to perform well. It uses computer technologies, telecommunication technologies and other software andhardware technologies to facilitate the activities of business organizations (Obrien, 1996).3.3 Benefits of Information Technology in Banking SectorLike any other organization information technology has business values for banks. 167). Pennsylvania: Idea Group Inc (IGI). Academia.edu uses cookies to personalize content, tailor ads and improve the user experience. 189 0 obj StudyCorgi. <> Thus, the quantification, measurement, mitigation and management of all the kinds of risks that banks face constitutes the third important dimension of Banking Technology. Information Technology and Banking Sector. The expertise sometimes poses inconveniencies if there is technological failure in a particular area (Muralidharan 2009, pp. endobj 191 0 obj

It allows all visa card holders to withdraw cash and ask their balance. Despite all these, IT remains powerful in banking and better off than the human intensive sector. Commendably, passwords and usernames be personalized and only used on familiar and reliable sites. 3.3.1 Benefit of IT for the Customer:Banks are aware of customer's need for new services and plan to make them available. here By using our site, you agree to our collection of information through the use of cookies. <> vdR`:? If banks staff have positive attitude, it will be easy to adopt the technology and on the other hand if they have negative attitude towards the technology, they will resist the adoption of the technology. The vast majority of large banks, will create value networks. The advances made in information and communication technologies take care of this dimension. Pioneering Approach of Damage Recovery of Forensics Evidence Images. IT together with internet networking systems has a crucial posture on the effectiveness of funds, resources, and foreign exchange bazaar. Ho, S. & Mallick, T. (2006) The Impact of Information Technology on the BankingIndustry: Theory and Empirics..

The term Banking Technology refers to the use of sophisticated information and communication technologies together with computer science to enable banks to offer better services to its customers in a secure, reliable and affordable manner and sustain competitive advantage over other banks. The technology has also provided the banking industry with a breakthrough in dealing with the challenges brought by the present financial system. 7]t UEj7Z>gcn8Q;JGEmr-oHu+lB&&>5;7[GT@!$h#DS&M,ERXW~v+bLe"&t)Wi(%dE&CK6{ASg)Ww ~ddBvfMT`-.^bW= 'FYn}n3((Pjf%qGiG#xL"qC,}H)D@3`do! [hCvx;t*fZa/Q5\Ctm+:v =5"? ,YAd|s=brC}umEiOL#w{s;{%nnqKqj w~9S8& P$GKtqapt~KWl\k$ 7 VP,;imt}*16]K5.(Zj>E`\}C1bS?}N D (2022) 'Information Technology and Banking Sector'. xcbd`g`b``8 " e:] "9H-IT"EBA$ DJ$c;Dle`b|Q0x~0Jd8nh { %PDF-1.5 $b$(T=

Boutte (2001). endobj % /V }W'!q;;+V8"fI=+:z;GP_}aNW{!JVGU?ZHu('))|Xo%V'jGE4rkNfn WfLB"2"9X0c0!,b0J3QQuW8)>tr-Ffu;U]glv. January 21, 2022. https://studycorgi.com/information-technology-and-banking-sector/. Ltd. SCN Education B.V. (2001) Electronic banking: the ultimate guide to business andtechnology of online. 4. 6). << /Filter /FlateDecode /S 1226 /Length 837 >> Seeing this pattern of growth, it seems obvious that IT can bring about equivalent contribution to profits.In general, existing studies have concluded two positive effects regarding the relation between IT and banks performance. Another disadvantage is that it takes long to acquire an active internet account. Benefits of Information TechnologyOperational Excellence:The use technology for efficiency doing things Wright in the least amount of time, with the fewest number of errors, and son on.Major Business Initiative:The use of technology to support initiatives such as customer relationship management, enterprises resources planning, sales for automation, and supply change management.Supply Change Management(SCM):An IT system that supports supply chain management activities by automating the tracking of inventory and information among business processes and across companies.Customer Relationship Management(CRM):CRM consists of the processes a company uses to track and organize its contacts with its current and prospective customers. (2022, January 21). StudyCorgi, 21 Jan. 2022, studycorgi.com/information-technology-and-banking-sector/. 2). endobj ii) Remote banking: Remote terminals at the customer site connected to the respective branch through a modem, enabling the customer to make inquiries regarding his accounts, on-line, without having to move from his office. It allows 24-hours cash withdrawal facilities using debit/ credit cards, fast cash, fund transfer, Personal Identification Number (PIN) change, mini-statement request etc.INTERNET BANKING TECHNOLOGY: It is the use of internet technology as a channel for providing service directly for customers. It also offers improved access to savings accounts.5. << /Linearized 1 /L 1285402 /H [ 1953 919 ] /O 192 /E 140385 /N 70 /T 1284002 >> https://studycorgi.com/information-technology-and-banking-sector/. Berger A. N. (2003). 190 0 obj %PDF-1.5

Banks must also create performance measurement systems to assure the mix products and services they offer are beneficial to both the customer and the bank. IT is the use of computers to lever information. They assist to improve their service quality, increase speed of service delivery, minimize cost, increase profitability, offer convenience in providing anytime and anywhere banking. to go back to the article page.Or contact our Some clients avoid the use of internet banking as they have trouble in understanding its mode of operation. (2003) Information Technology. Second, IT can facilitate transactions among customers within the same network (the network effect).2. StudyCorgi. a5AeRikg>5@:6@ ^RiO,m 'gwAn Doing so presents tremendous challenges. DIGITAL REVOLUTION OF BANKING SECTOR IN THE INDIA -A PATH OF BOON OR BANE TOWARDS CASHLESS ECONOMY, CRITICAL SUCCESS FACTORS IN E-BANKING: AN INDIAN PERSPECTIVE. X,dTF}3U.-5o2: h62x7>|ln&#+!_}5a1XE>coqSi>/aI; wLo >pq*4E*0|;BmW43`k/F': gwt19$q*8xX8P* voO},u~\O32*4}& = (IT) in the banking industry. <>/ExtGState<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/MediaBox[ 0 0 595.32 841.92] /Contents 4 0 R/Group<>/Tabs/S/StructParents 0>> It has been the basis of recent financial segment reforms intended to raise the pace and consistency of financial processes together with the customer responsive services. 3 0 obj A few cases of forgery reported in online banking and time taken to get the Internet account are all negative to the business growth. Hunter, G. & Tan, F. (2007) Strategic use of information technology for globalorganizations. support team al., 1994) business value of information technology refers to the contribution of information technology to organizational performance. Account balance enquiry, fund transfer among the accounts of same customer, opening or modify of term deposit account, pay order request, bills payment, account summary, account details, account activity, standing instructions, loan repayment, loan information, statement request, refill prepaid card, password change, bank guarantee application, lost card (debit/credit) reporting, pay credit card dues, view credit card statement or check balance are some of the services that can be provided by banks through internet banking technology.POINT OF SALE (POS) TERMINAL: It is an electronic machine that can sense a special plastic card that is encoded with information on a magnetic slip. Nevertheless, technology alone will not solve issues or create advantages. You can download the paper by clicking the button above. "Information Technology Demystified, A Report from the UniForum Technical Steering Committee.2. Similarly, descriptive statistics is used to examine the existing status of the banks in Information Technology adoption and most commercial banks are found lagging behind in adopting Information Technologies that can provide them with multi-directional benefits. 190). 4 0 obj 2.9. endobj STRATEGY FOR THE FUTURE: Banks face a serious challenge. They are as follows: (i) The use of appropriate hardware for conducting business and servicing the customers through various delivery channels and payments systems and the associated software constitutes one dimension of Banking Technology. Online services, internet facilities, as well as mobile banking are no exception. The most obvious example is perhaps the banking industry, where through the introduction of IT related products in internet banking, electronic payments, security investments, information exchanges banks now can provide more diverse services to customers with less manpower. Allows debit cards, credit cards, visa cards etc for making transactions. 2022. Retrieved from https://studycorgi.com/information-technology-and-banking-sector/, StudyCorgi. Copyright 2020 Elsevier B.V. or its licensors or contributors. List of ReferencesIT has led to emergence of novel markets, merchandise, services and adept release apparatus for the banking sector. CRM software is used to support these processes; information about customers and customer interactions can be entered, stored and accessed by employees in different company departments.Business Intelligence:The knowledge about your customers, your competitors, your business partners, your competitive environment, and your own internal operations that gives you the ability to make effective, important, and often strategic business decisions. endobj Informationtechnology is changing the way organizations do their activities. (ii) On the other hand, the use of advanced computer science algorithms to solve several interesting marketing related problems such as customer segmentation, customer scoring, target marketing, market-basket analysis, cross-sell, up-sell and customer retention etc. 2 0 obj endobj 3 0 obj It provides 24-hours cash access within the sanctioned limit to customers credit account through ATM, POS, merchant shop window, and payment counter, making payment to merchant against purchase of goods and services, availing cash advances, withdrawal of cash from ATM, SMS banking, internet banking etc.DEBIT CARD TECHNOLOGY: A special plastic card that is encoded with information on a magnetic strip linked with deposit accounts with access to ATM or POS terminal. New Delhi: PHI Learning Pvt. Disadvantages experienced by the banking industries include high cost of purchasing and installation of equipment, extra cost that comes with maintaining and ensuring security of these systems, doubling of work, security risks, and flexibility of work (Hunter & Tan 2007, pp. x[[sF~WC?. 2 0 obj The basic structure of the bank is increasingly in conflict with the changing product, delivery, and service needs of the customers The future belongs to financial service providers not traditional banks. MAJOR IT PRODUCTS USED IN BANKING SECTOR: Information Technology enables new product development, better market infrastructure, implementation of right techniques for control of risks and helps banks to extend their markets geographically. Information technology is a technology that deals with the physical devices and software that link various computer hardware components and transfer data from one physical location to another (Laudon and Laudon, 1991).Anderson (2006) has defined information technology as hardware and software technologies used to create information system.3.2 The Business Value of Information TechnologyAccording to (Kraemer et. * Hyperlink the URL after pasting it to your document, Increased Government Spending: The AD-AS Model, Chinas African Adventure: Where the West Sees the Need for Reform, Beijing Sees Nothing but Resources and Opportunities, Tires Import: Effects on Us Domestic Tire Producers, Business Cycle Indicators: Coincident and Leading Indicators, We use cookies to give you the best experience possible. As the number of mobile phone increases there has been a pervasive impact on people's lives. Introduction: Information technology is, nowadays, affecting the daily activity of individuals and organizations. As a result banks staff will not give value for banking technologies and as a result might develop negative attitude towards suchtechnologies.COMPATIBILITY (SYSTEM INTEGRATION PROBLEM): banks staff perceives that banking technology might not compatible with their existing banking systems.COMPLEXITY (SYSTEM TECHNICAL DIFFICULTIES): Banks staffs fear that new banking technology might be complex to adopt in many ways.CONFIDENTIALITY AND PRIVACY: Less standard security measures expressed by those responsible for IT are not up to the standard required in the banking industry.LACK OF APPROPRIATE TECHNICAL KNOWLEDGE AMONGST BANK STAFF: Banks staff with poor IT backgrounds will show a negative attitude towards banking technology application.AVAILABILITY OF INFORMATION TECHNOLOGY FUNDS: this is related with lack of strategic plan. <> If there is no strategic plan for Information technology, there will not be budget for Information technology.6. The usage of information technology (IT), broadly referring to computers and peripheral equipment, has seen tremendous growth in service industries in the recent past. <> vi) As information is centralized and updates are available simultaneously at all places, single-window service becomes possible, leading to effective reduction in waiting time. First, IT can reduce banks operational costs (the cost advantage). It is believed that IT can improve banks performance in two ways: IT can reduce operational cost (cost effect), and facilitate transactions among customers within the same network (network effect). faced by the banks to reap profits and outperform their competitors constitutes the second dimension of Banking Technology. 285). About ScienceDirectShopping cartContact and supportTerms and conditionsPrivacy policy. January 21, 2022. https://studycorgi.com/information-technology-and-banking-sector/. Using internet banking technology, customers who have access to internet, can conduct transaction from wherever they are. They have already developed and implemented a certain number of solutions among them:i)Self-inquiry facility: Facility for logging into specified self-inquiry terminals at the branch to inquire and view the transactions in the account.

4). B.J. "Information Technology and Banking Sector."

Employees fear such responsibility and as a result develop negative attitude towards new technology adoption.FEAR OF JOB LOSSES: banks staff might have negative attitude towards the application of new banking technology anticipating it as a threat to their jobs. IT has increased the level of competition and forced them to integrate the new technologies in order to satisfy their customers. Ravi, V. (2011). Different constituents of banking technology, Copyright 1988-2022, IGI Global - All Rights Reserved, (10% discount on all e-books cannot be combined with most offers. Mohammad Abukhzam Angela Lee (2010), Factors affecting bank staff attitude towards e-banking adoption in Libya, The Electronic Journal of Information Systems in Developing Countries (EJISDC), vol. POS provides a number of services such as, payment for products purchased or services rendered at different merchant locations using debit/ credit cards etc.TELE BANKING TECHNOLOGY: Tele Banking Technology is a banking technology that enables customers to get banking service by dialing to particular telephone number of the banks form the place they are. <> This theory is called Diffusion of Innovation (DOI) Theory. 21 January.

If you use an assignment from StudyCorgi website, it should be referenced accordingly. 3. Use of ATMs, mobile and internet banking are just but a few cases. The use of computer networks, security algorithms in its transactions, use of ATM and credit cards, Internet banking, telebanking and mobile banking are all covered by this dimension. Networking of computerized branches inter-city and intra-city, will permit customers of these branches, when interconnected, to transact from any of these branches. stream

This achievement comes from the introduction of products related to IT. In M. Sarlak, & A. Hastiani (Eds. Clientele do not trust the services of the bank through the internet especially in money concerns. (2022, January 21). However, the implementations of the technologies depend on the attitude of customers towards the technology to be adopted. FEAR OF NEW RESPONSIBILITIES: when new technologies are applied, it is obvious that they will come up with new way of doing things, which employees assume it as new responsibilities. You are free to use it to write your own assignment, however you must reference it properly. support team who will be happy to help. xko6{}IEfM{8V|\I=l[$yqrvz{lqz=^(//BDluz{X_x"G7qo~e|;@@kpCO_fOO`vRDLvyN52`Ec6i9toj!p qpHa`g8;"C~Bo"#,C==1>CQ!snl, >,h8>8g\,/Yxerz/7PgSGL DpEi;>xS+Z9 >2%q1oX/syV1XUgq,{O3Ggg%b>`Xa6L,W>x^|& 3.3.2 Benefits of IT for the Bank:During the last decade, banks applied bank-related information technologies to a wide range of back and front office tasks in addition to a great number of new products. (2006) Internet banking and the law in Europe: regulation, financialintegration and electronic commerce. They must determine whether to deploy new technologies themselves or with other service providers. Thus, in a nutshell, in the word Banking Technology, banking refers to the economic, financial, commercial and management aspects of banking while technology refers to the information and communication technologies, computer science and risk quantification and measurement aspects. Roger W Ferguson (2000): Information technology in banking and supervision.7. They can reach remote area at low cost. small business lending, personal trust services, investment banking) through branches. In general, the two positive effects regarding the correlation between IT and banks performance include reduced banks operational costs and facilitating dealings among customers within the same network (Ho & Mallick 2006, pp.

`~3:>>$\m)8s6HU@Y7 28Hr6 We use cookies to help provide and enhance our service and tailor content and ads. Furthermore, it helps the financial intermediaries to attain geographically isolated and expanded markets. stream i1!oF5HhB`nZpp54xiLOG*I~->M9 -%0;a- %Zn?a_zaol{NDzE KW2G `m=ela1`QRtvo;6v z{g+;. Different organizations operating in different environments, apply different information technology products, and thus attain values form the applied information technology.As studies indicate, information technology has positive influence on the productivity and profitability of organizations (Brynjolfsson and Hitt 1996). who will be happy to help. endobj Braunschweig: Birkhuser.

This has led to sophisticated product expansion, advanced market infrastructure, execution of reliable methods to curb risks (SCN Education B.V 2001, pp. *Q*7y= Academia.edu no longer supports Internet Explorer. Figure 1 depicts the constituents of Banking Technology. South Yarra: Black Rabbit Books.

StudyCorgi. From theoretical perspective, Banking Technology is not a single, stand-alone discipline, but a confluence of several disparate fields such as finance (subsuming risk management), information technology, communication technology, computer science and marketing science. Diffusion of innovations (5th edition). Mobile banking helps to cover wide geographical area. If you continue, we will assume that you agree to our. endstream This paper was written and submitted to our database by a student to assist your with your own studies. Banking Technology also subsumes the activity of using advanced computer algorithms in unraveling the patterns of customer behavior by sifting through customer details such as demographic, psychographic and transactional data. Information Technology and Banking Sector. The surfacing of internet banking began in the 1980s and several people utilize its facilities.

Gkoutzinis, A. For example, internet helps banks to conduct standardized, low value-added transactions (e.g. Benefits of information technology for bank is three directional:- to the customer, to the bank and to the employees.

The greater the compatibility, the faster is the rate of technology adoption.Simplicity that is the degree to which the innovation is perceived to be simple to understand or to use. <> OO0iXIi|fkda&{88 Mobilemoney: Cell Phone Banking In Developing Countries.6. In other words the simpler the innovation for understanding it will be more rapidly adopted than innovation that requires more complex understanding.Trial ability that is the degree to which an innovation may be experimented on a trial basis before it really convince large majority of the adopters. The easier for individuals to see the results of an innovation the more convincing the innovation to be adopted.A search of the banking literature reveals that banks are moving rapidly to take advantage of recent and new customer service and cost reduction opportunities that new technologies offer. iv) Telebanking: A 24-hour service through which inquiries regarding balances and transactions in the account can be made over the phone. Information Technology infrastructures have various advantages for business organizations like financial institutions, and more particularly banks. From the functional perspective, Banking Technology has three important dimensions. This dimension covers the implementation of a data warehouse for banks and conducting data mining studies on customer data.