Discuss the Electronic functions provided by bank?
Using computers and internet in the functioning of the banks is called electronic
banking. Because of these services the customers do not need to go to the bank
every time he has to transact with bank. He can make transactions with the bank
at any time and from any place. The chief electronic services are the following.
1. Electronic. Fund Transfer: Under it, a bank transfers wages and salaries
directly from the company s account to the accounts of employees of the
company. The other examples of EFTs are on line payment of electricity
bill, water bill, insurance premium, house tax etc.
2. Automatic Teller Machines: (ATMs) ATM is an automatic machine with
the help of which money can be withdrawn or deposited by inserting the
card and typing your personal Identity Number (PIN). This machine
operates for all the 24 hours.
3. Debit Card: A Debit Card is issued to a customers in lieu of his money
deposited in the bank. The customers can make immediate payment of
goods purchased or services obtained on the basis of his debit card
provided the terminal facility is available with the seller.
4. Credit Card: A. bank issues a credit card to those of its customers who
enjoy good reputation. This is a sort of overdraft facility. With the help of
this card the holder can buy goods or obtain services up to a certain
amount even without having sufficient deposit in their bank accounts.
5. Tele Banking: Under this facility, a customer can get information about
the balance in his account or information about the latest transactions on
the telephone.
6. Core Banking Solution Centralized Banking Solution: In this system
a customer by opening a bank account in one branch (which has CBS
facility) can operate the same account in all CBS branches of the same
bank anywhere across the country. It is immaterial with which branch of
the bank the customer deals with when he/she is a CBS branch customer.
7. National Electronic Fund Transfer: NEFT refers to a nation wide system
that facilitate individuals, firms and companies to electronically transfer
funds from any branch to any individual, firm or company having an
account with any other bank branch in the country. NEFT settles
transactions in batches. The settlement takes place at a particular point
of time for example, NEFT settlement takes place 6 times a day during
the week days (9.30am, 10.30 am, 12.00 noon, 1.00 pm. 3.00 pm & 4.00
pm) and 3 times during Saturday 9.30 am, 10.30 am and 12.00 noon)
Any transaction initiated after a designated settlement time is settled on
the next fixed settlement time.
8. Real Time Gross Settlement: RTGS refers to a funds transfer system
where transfer of funds takes place from one bank to another on a Real
time and on Gross basis. Settlement in Real time means transactions aresettled as soon as they are processed and are not subject to any waiting
period.
Gross settlement means the transaction is settled on one to one basis without
bunching or netting with any other transaction. This is the fastest possible money
transfer system through the banking channel.
The RTGS service for customers is available from 9.00 am to 3.00 pm on week
days and from 9.00 am to 12.00 noon on Saturdays.
The basic difference between RTGS and NEFT is that while RTGS transactions
are processed continuously, NEFT settles transactions in batches.
Benefits of E-Banking to customer:-
1. E-Banking provides 24 hours a day X 365 days a year services to the
customers.
2. Customers can make transactions from office or house or while traveling
via mobile telephone.
3. There is greater customer satisfactions through -banking as it offers
unlimited access and great security as they can avoid travelling with
cash.
Benefits of E-Banking to Banks:-
1. E-Banking lowers the transaction cost.
2. Load on branches can be reduced by establishing centralized data base.
3. E-Banking provides competitive advantage to the bank, adds value to the
banking relationship.
banking. Because of these services the customers do not need to go to the bank
every time he has to transact with bank. He can make transactions with the bank
at any time and from any place. The chief electronic services are the following.
1. Electronic. Fund Transfer: Under it, a bank transfers wages and salaries
directly from the company s account to the accounts of employees of the
company. The other examples of EFTs are on line payment of electricity
bill, water bill, insurance premium, house tax etc.
2. Automatic Teller Machines: (ATMs) ATM is an automatic machine with
the help of which money can be withdrawn or deposited by inserting the
card and typing your personal Identity Number (PIN). This machine
operates for all the 24 hours.
3. Debit Card: A Debit Card is issued to a customers in lieu of his money
deposited in the bank. The customers can make immediate payment of
goods purchased or services obtained on the basis of his debit card
provided the terminal facility is available with the seller.
4. Credit Card: A. bank issues a credit card to those of its customers who
enjoy good reputation. This is a sort of overdraft facility. With the help of
this card the holder can buy goods or obtain services up to a certain
amount even without having sufficient deposit in their bank accounts.
5. Tele Banking: Under this facility, a customer can get information about
the balance in his account or information about the latest transactions on
the telephone.
6. Core Banking Solution Centralized Banking Solution: In this system
a customer by opening a bank account in one branch (which has CBS
facility) can operate the same account in all CBS branches of the same
bank anywhere across the country. It is immaterial with which branch of
the bank the customer deals with when he/she is a CBS branch customer.
7. National Electronic Fund Transfer: NEFT refers to a nation wide system
that facilitate individuals, firms and companies to electronically transfer
funds from any branch to any individual, firm or company having an
account with any other bank branch in the country. NEFT settles
transactions in batches. The settlement takes place at a particular point
of time for example, NEFT settlement takes place 6 times a day during
the week days (9.30am, 10.30 am, 12.00 noon, 1.00 pm. 3.00 pm & 4.00
pm) and 3 times during Saturday 9.30 am, 10.30 am and 12.00 noon)
Any transaction initiated after a designated settlement time is settled on
the next fixed settlement time.
8. Real Time Gross Settlement: RTGS refers to a funds transfer system
where transfer of funds takes place from one bank to another on a Real
time and on Gross basis. Settlement in Real time means transactions aresettled as soon as they are processed and are not subject to any waiting
period.
Gross settlement means the transaction is settled on one to one basis without
bunching or netting with any other transaction. This is the fastest possible money
transfer system through the banking channel.
The RTGS service for customers is available from 9.00 am to 3.00 pm on week
days and from 9.00 am to 12.00 noon on Saturdays.
The basic difference between RTGS and NEFT is that while RTGS transactions
are processed continuously, NEFT settles transactions in batches.
Benefits of E-Banking to customer:-
1. E-Banking provides 24 hours a day X 365 days a year services to the
customers.
2. Customers can make transactions from office or house or while traveling
via mobile telephone.
3. There is greater customer satisfactions through -banking as it offers
unlimited access and great security as they can avoid travelling with
cash.
Benefits of E-Banking to Banks:-
1. E-Banking lowers the transaction cost.
2. Load on branches can be reduced by establishing centralized data base.
3. E-Banking provides competitive advantage to the bank, adds value to the
banking relationship.