Banking Technology

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  • Topic: Bank, Banking, Online banking
  • Pages : 10 (2914 words )
  • Download(s) : 160
  • Published : March 3, 2013
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INTRODUCTION

The entire world is living with technology, survive with technology, the term technology is take part with entire human life in the world all the activites were done successfully through technology, this helps to everyone to survive in the tuff competitive world, now a days all the sectors were emerging with the use of technology, the banking sector also adopting technology in different aspects to their effective performance in the competitive environment, and through this they are rendering the best services to their customers.

The term “banking technology” refers to the use of sophisticated information and communication technologies together with computer science to enable banks to offer better services to its customers in a secure, reliable, and affordable manner, and sustain competitive advantage over other banks. Banking technology also subsumes the activity of using advanced computer algorithms in unraveling the patterns of customer behavior by sifting through customer details such as demographic, psychographic, and transactional data. This activity, also known as data mining, helps banks to achieve their business objectives by solving various marketing problems such as customer segmentation, customer scoring, target marketing, market-basket analysis, cross-sell, up-sell, customer retention by modeling churn, and so forth.

Successful use of data mining helps banks achieve significant increase in profits and thereby retain sustainable advantage over their competitors. From a theoretical perspective, banking technology is not a single, stand-alone discipline, but a confluence of several disparate fields such as finance (subsuming risk management), information technology, communication technology, computer science, and marketing science.

Banking technology comprises the information technology, finance and risk management, marketing risk, communications technology and finally computer science. so the banking technology cover all the aspects of the all the activites of banking in angle of technology for effectiveness in all the actions of banking sector

EVOLUTION OF BANKING TECHNOLOGY
World Bank and the development of payment technology
During the post second world war period and with the introduction of the Bretton Woods system in 1944, two organizations were created: the International Monetary Fund (IMF) and the World Bank. Encouraged by these institutions, commercial banks started to lend to sovereign states in the third world. This was at the same time as inflation started to rise in the west. The Gold standard was eventually abandoned in 1971 and a number of the banks were caught out and became bankrupt due to third world country debt defaults.1969 ABC news report on the introduction of ATMs in Sydney. People could only receive $25 at a time and the bank card was sent back to the user at a later date. This was also a time of increasing use of technology in retail banking. In 1959, banks agreed on a standard for machine readable characters (MICR) that was patented in the United States for use with cheques, which led to the first automated reader-sorter machines. In the 1960s, the first Automated Teller Machines (ATM) or Cash machines were developed and first machines started to appear by the end of the decade. Banks started to become heavy investors in computer technology to automate much of the manual processing, which began a shift by banks from large clerical staffs to new automated systems. By the 1970s the first payment systems started to be develop that would lead to electronic payment systems for both international and domestic payments. The international SWIFT payment network was established in 1973 and domestic payment systems were developed around the world by banks working together with governments. Adoption of banking Technology in india

The IT revolution had a great impact in the Indian banking system. The use of computers had led to introduction of online banking in...
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