IT in Indian Banks

Megha Hinge (11217) Ankit Khadloya (11222) Bhushan Vetal (11254) Roshni Karwa (11269)
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Contents
Introduction IT related banking services SWIFT SFMS INFINET Banking application package vendors Effects of IT on Banks Impact of IT on Service Quality Effects of IT on workforce

Introduction
Rangarajan Committee report is blueprint for computerization and mechanization in the Banking Industry RANGARAJAN COMMITTEE (I) Formed to draw up a phased plan for computerization and mechanization in the Banking Industry over a 5 year time frame of 1985-89. Focus on customer service Provided the customer with error-free accounting, regular statements of accounts etc.

Contd..
RANGARAJAN COMMITTEE (II) Constituted in 1988 Drew up a detailed perspective plan for computerization of banks and for extension of automation to other areas like funds transfer, electronic mail, BANKNET, SWIFT, ATMs etc.

IT related banking services

Real Time Gross Settlement Electronic Funds Transfer Electronic Clearing Service

Point of Sale Terminal

Automatic Teller Machine Net Banking Mobile Banking
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SWIFT
Society for World Wide Interbank Financial Telecommunication links >9,000 financial institutions in 209 countries and territories a secure network for transmitting messages between financial institutions a set of syntax standards for financial messages a set of connection software and services, allowing financial institutions to transmit messages

SFMS
Structured Financial Messaging System An EDI system for bank Security: Uses x.509 digital signatures Consists of Hub Gateway Branch Server Online and Offline Terminals

INFINET - Indian Financial Network

Recommended by Saraf Committee Satellite based wide area network Uses VSAT technology Set up by the RBI in June 1999 The hub and Network Management System located in the IDRBT, Hyderabad "INFINET User Group" has been formed to resolve issues of common interest on a continuing basis.

INFINET - Major Applications

e-mail Electronic Clearing Service - Credit and Debit Reporting to RBI Cash management system S/W distribution and management Customer database Electronic Funds Transfer Transmission of Inter-city Cheque realization advices Management Information System (MIS)

Banking Application Package Vendors

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Effects of IT on Banks
Reduced hierarchical structure, establishment of direct liaison between top management and field functionaries Shift to dispersed decision making

Need for middle management vanished and autonomous

self managing groups emerged DSS and ESS bring transparency in decision making Operating procedures change, Accounting procedures re-designed
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Impact of IT on Service Quality

Helps banks irrespective of their size Helps in commoditizing financial services Technology pushes the delivery of services out of the bank Focus shifts from cost reduction to maintaining market position Shift of the market power from banks to customers Dehumanization of very human business i.e. personal banking

Effects of IT on Workforce
Job Losses Changes in job content Pressure for flexibility

Loss of union power

Womens employment in banking

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References
Indian Banking Industry & Information Technology: B. R. Nanda, Surendra Publications Modern Banking of India: O. P. Agarwal, Himalaya Publishing House www.infosys.com www.oracle.com www.nucleussoftware.com www.banknetindia.com www.rbi.org.in

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Thank you

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