Impact Of Technology In Banking
In the realm of banking and finance nothing stands still. The greatest change of is incorporated in the, scope of the process of banking. Banking in the traditional from is worried using the acceptance of deposits in the customers, the lending of surplus of deposited money to appropriate customers who would like to borrow and transmission of funds. Aside from traditional business, banks these days provide an array of services to fulfill the financial and non financial needs of all of consumers in the tiniest account holder towards the largest company and perhaps of non customers. The plethora of services provided is different from bank to bank depending mainly around the size and type from the bank.
RESERVE BANK’S EARLY INITIATIVES
Like a central bank inside a developing country, the Reserve Bank asia (RBI) has adopted growth and development of the banking and financial market among its prime objectives. “Institutional development” was the hallmark of the approach from 1950s to 1970s. Within the 1980s, the Reserve Bank centered on “enhancements within the productivity” from the banking sector. Being believing that technology is paramount for improving in productivity, the Reserve Bank required several initiatives to popularize use of technology by banks in India.
Periodically, almost once in 5 years because the early 1980s, the Reserve Bank hired committees and dealing Groups to deliberate on and recommend the right utilization of technology by banks provide the conditions and also the need. These committees are listed below:
-Rangarajan committee -one in early 1980s.
-Rangarajan committee -11 at the end of 1980s.
-Saraf working group at the begining of 1990s.
-Vasudevan working group at the end of 1990s.
-Barman working group at the begining of 2000s.
In line with the recommendations of those committees and dealing groups, the Reserve Bank issued appropriate guidelines for that banks. Within the 1980s, use of technology for that back-office operations from the banks predominated the scene. It had been by means of accounting of transactions and assortment of MIS. Within the inter-bank payment systems, it had been by means of clearing and settlement while using MICR technology.
Two momentous decisions from the Reserve Bank within the 1990s altered the scenario for good you will find:
a) The prescription of compulsory use of technology entirely measure through the new private sector banks like a precondition from the license and
b) The establishment of the exclusive research institute for banking technology institute for development and Research in Banking Technology.
Because the new private sector banks came in this area as technology-savvy banks and offered several innovative products in front office for that customers according to technology, the demonstration effect caught around the reset from the banks. Multi funnel choices like machine based (ATMs and pc-Banking), card based (credit/Debit/Smart cards), Communication based (Tele-Banking and Online Banking) ushered in Anywhere and anytime Banking through the banks in India. The IDRBT continues to be instrumental in creating a good, condition from the art communication backbone within the from from the Indian Financial NETwork (INFINET) like a closed user group solely for that banking and financial sector in India.