E-banking

E-banking history
On global scenario
The term online became popular in the late '80s and referred to the use of
a terminal, keyboard and TV (or monitor) to access the banking system
using a phone line.
Online services started in New York in 1981 when four of the citys major
banks (Citibank, Chase Manhattan, Chemical and Manufactures Hanover)
offered home banking services using the videotex system.
In India
ICICI was the first bank to start The Internet Banking revolution in India
as early as 1997 under the brand name Infinity.
ICICI Bank kicked off online banking way back in 1996.But even for
internet as whole, 1996 to 1998 marked the adoption phase, while usage
increased only in 1999 due to lower ISP online charges , increased PC
penetration and a tech-friendly atmosphere.

E-banking ?
In simple language it is defined as the provision of
banking service through electronic channels and the
customer can access the data without time and
geographical limitation.


Virtual banks
Virtual banks have no physical location, but only conduct
online transactions.
The world's first fully-functional virtual bank was the
Security First Network Bank (SFNB)
These banks were designed without a traditional banking
infrastructure.

Virtual Banks around the world are:
ING Direct
U Bank
HSBC Direct
First Direct


Electronic mediums of E-Banking
Internet banking
Phone Banking
Mobile Banking
ATM



ATM
An automated teller machine (ATM), also known as
automatic banking machine (ABM), Cash Machine, or Cash
point , is a computerised telecommunications device that
provides the clients of a financial institution with access to
financial transactions in a public space without the need for a
cashier, human clerk or bank teller.

On Most modern ATMs, the customer is identified by
inserting a plastic ATM card with a magnetic stripe
or a plastic smart card with a chip, that contains a
unique card number and some security information
such as an expiration date. Authentication is
provided by the customer entering a personal
identification number (PIN).

Phone banking
Mobile Banking
Development in Ebanking
Growth of internet banking account
117% increase in transaction volume since April 2001
More than 1 million contacts in February 2002
Coverage across 100 locations in the country
103% increase in internet banking registrants since April 01
84% increase in transactions since April 01



Benefits to bank
Benefits to customer
Benefits to small to medium business
Benefits for Banks
Larger customer coverage

Reducing the costs of operations

Promoting their services and products
internationally

Increasing the customer satisfaction and providing
a personalized relationship with customers

Benefits for Small to Medium
Businesses
To run its operations more effectively

Lower cost than traditional financial management
mechanisms

Benefits for Customers
Communication
- communicate easily

Environmental
- Abolishing the uses of paper

Others
- Offering one-stop-shop solutions


Disadvantages on E-banking
A need for customer skill to deal with computers and
browsers.

E.g. Elderly, Housewives Inconvenient

Site change it will make the customer have some
confusion or delay.
Security Risk

Security Risk
Increasing number of fraudulent bank websites
Fake emails purporting to be sent from banks
Use of Trojan Horse programs to capture user IDs
and passwords

Fraudulent Bank Websites
A suspicious bank website:
www.onlinebea.com
Original bank website
www.hkbea.com
The website was believed to aim to trick persons
into disclosing their sensitive personal information.

Fake Emails
Email send from Fraudulent bank
Verify the personal information
Guide customer enter the fraud link
Disclosing their ATM card numbers and their
passwords

-

When we open some suspicious websites or email .
Trojan Horse Program will install our computer secretly.

Hidden in the computer When you access bank websites
Capture our account and the password


For Bank:
Should provide specific guidance to their customers


For Customers:
Should not disclose their Log In IDs(account
number) or password to anyone else.
Periodically change their passwords.
Should regularly check their account balances
and statements to identify unusual
transactions