Features of E-banking: E–banking is a product designed for the purposes of online banking that enables you to have easy and safe access to your bank account. E-banking or Online banking is a generic term for the delivery of banking services and products through the electronic channels such as the telephone, the internet, the cell phone etc.
Features of E-banking
1) Transactional :
- a) Electronic Bill Presentment and Payment (EBPP)
- b) Funds transfer between customers own checking and savings accounts, or to another customers account.
- c) Investment purchase or sale.
- d) Loan application and transactions such as repayments.
(e.g. performing a financial transaction such as an account to account transfer, paying a bill or applications like applying for a loan, new account, etc.)
2) Non-transactional :
Financial Institution Administration features allowing financial institutions tomanage the online experience of their end users. ASP/ Hosting Administration – features allowing the hosting company to administer the solution across financial institution. (e.g. online statements, Check links, Chat, Cobrowsing etc.)
In recent time E-banking has spread rapidly all over the globe. All Banks are making greater use of E-banking facilities to provide better service and to excel in competition. The spread of E-banking has also greatly benefited the ordinary customer in general and corporate world in particular. The following points summarise benefits of E-Banking.
A) Benefits to Consumers :
General consumers have been significantly affected in a positive manner by E-banking. Many of the ordinary tasks have now been fully automated resulting in greater ease and comfort
- Customer’s account is extremely accessable with an online account.
- Customer can withdraw at any time through ATMs that are now widely available throughout the country.
- Besides withdrawing cash customers can also have mini banks statements balance inquiry at these ATMs.
- Through Internet Banking customer can operate his account while sitting in his office or home. There is no need to go to the bank in person for such matter.
- E banking has also greatly helped in payment of utility bill. Now there is no need to stand in long queues outside banks for this purpose.
- All services that are usually available from the local bank can be found on a single website.
- The Growth of credit card usage also owes greatly to Ebanking. Now a customer can shop worldwide without any need of carrying paper money with him.
- Banks are available for 24 hours a day, seven days a week and they are only a mouse click away.
Benefits to Banking Industry :
Banking industry has also received numerous benefits due to growth of E-Banking infrastructure. They are highlighted below:
- The growth of E-banking has greatly helped the banks in controlling their overheads and operating cost
- Many repetitive and tedious tasks have now been fully automated resulting in greater efficiency, better time usage and enhanced control.
- The rise of E-banking has made banks more competitive. It has also led to expansion of the banking industry, opening of new avenues for banking operations.
- Electronic banking has greatly helped the banking industry to reduce paper work, thus helping them to move the paper less environment.
- Electronic banking has also helped bank in proper documentation of their records and transactions.
- The reach and delivery capabilities of computer networks, such as the Internet, are far better than any branch network.
Benefits to General Economy :
Electronic Banking as already stated has greatly serviced both the general public and the banking industry. This has resulted in creation of a better enabling environment that supports growth, productivity and prosperity. Besides many tangible benefit in form of reduction is cost, reduced delivery time, increased efficiency, reduced wastage, E-banking electronically controlled and thoroughly monitored environment discourage many illegal and illegitimate practices associated with banking industry like money laundering, frauds and embezzlements.
Further E-banking has helped banks in better monitoring of their customer base. It is a useful tool in the hand of the bank to device suitable commercial packages that are in conformity with customer needs. As E-banking provides opportunity to banking sector to enlarge their customer base, a consequence to increase the volume of credit creation which results in better economic condition. Besides all this E-banking has also helped in documentation of the economic activity of the masses.
The following are the disadvantages of E-banking :
Bank Relationship :
A traditional bank provides the opportunity to develop a personal relationship with that bank. Getting to know the people at your local branch can be an advantage when a customer needs a loan or a special service that is not normally offered to the public. A bank manager usually has some discretion in changing the terms of customer’s account if the customer’s personal circumstances change. They can help customers solve problems such as reversing an undeserved fee. The banker also will get to know the customer and his unique needs. If the customer has a business account, this personal relationship may help if the customer needs capital to expand. It’s easier to get the bank’s support if there is someone who understands customer’s business and vouch for his operating plan.
Transaction Issues :
Sometimes a face-to-face meeting is required to complete complex transactions and address complicated problems. A traditional bank can host meetings and call in experts to solve a specific issue. Moreover, international transactions may be more difficult (or impossible) with some direct banks. If a customer deposits cash on a regular basis, a traditional bank with a drive-through window may be more practical and efficient.
Service Issues :
Some direct banks may not offer all the comprehensive financial services such as insurance and brokerage accounts that traditional banks offer. Traditional banks sometimes offer special services to loyal customers such as preferred rates and investment advice at no extra charge. In addition, routine services such as notarization and bank signature guarantee are not available online. These services are required for many financial and legal transactions.
Direct banks are subject to the same laws and regulations as traditional banks and accounts are protected by the FDIC. Sophisticated encryption software is designed to protect your account information but no system is perfect. Accounts may be subject to phishing, hacker attacks, malware and other unauthorised activity. Most banks now make scanned copies of cleared checks available online which helps to avoid and identify check fraud. It enables verification that all checks are signed by the customer and that dollar or euro amounts have not been changed. The timely discovery of discrepancies can be reported and investigated immediately.