Evolution of science and technology brings pace in the world civilization. Banking is a changing industry. Beginning from the roadside of Lombardy Street of Italy to modern exquisite building, the evolution of technological improvement of banks never ends. In the early period of banking, people used to use their hands figures for computing. Later many innovative devices we are introduced and used to provide better banking facilities. Then the use of computer in banking activities in the 60s of the twentieth century was an unprecedented incident. The main purpose was to ensure mathematical accuracy and promptness in providing banking facilities like deposits and withdrawals. Every bank tries to use latest technology to provide its customers high quality banking services. In this modern world, bank is one of those reliable institution through which business contact with any corner of the world can be established. The improvement in the Information Technology narrows down the distance. Access to banking service is easy and convenient to its clients. They need not to worry to carry cash or cheques with them. A plastic card is sufficient enough for fulfillment of his monetary need. Electronic banking brings unprecedented changes in the world wide banking sector. With the help of this technology, the client directly offered newer types of services. This paper is intended to have a better understanding about several issues of electronic banking, the system of electronic banking, components of electronic banking and how it changes a particular banks operation in this case IFIC Bank Ltd.
Meaning of Electronic Banking:
For many consumers, electronic banking means 24-hour access to cash through an automated teller machine (ATM) or Direct Deposit of paychecks into checking or savings accounts. But electronic banking now involves many different types of transactions. Electronic banking, also known as electronic fund transfer (EFT), uses computer and electronic technology as a substitute for checks and other paper transactions. EFTs are initiated through devices like cards or codes that let you, or those you authorize, access your account. Many financial institutions use ATM or debit cards and Personal Identification Numbers (PINs) for this purpose. Some use other forms of debit cards such as those that require, at the most, your signature or a scan. The federal Electronic Fund Transfer Act (EFT Act) covers some electronic consumer transactions. [pic]
Figure: Electronic banking modes
Electronic Fund Transfers
EFT offers several services that consumers may find practical: • Automated Teller Machines or 24-hour Tellers are electronic terminals that let you bank almost any time. To withdraw cash, make deposits, or transfer funds betWeen accounts, you generally insert an ATM card and enter your PIN. Some financial institutions and ATM owners charge a fee, particularly to consumers who don’t have accounts with them or on transactions at remote locations. Generally, ATMs must tell you they charge a fee and its amount on or at the terminal screen before you complete the transaction. Check the rules of your institution and ATMs you use to find out when or whether a fee is charged.
• Direct Deposit lets you authorize specific deposits, such as paychecks and Social Security checks, to your account on a regular basis. You also may pre-authorize direct withdrawals so that recurring bills, such as insurance premiums, mortgages, and utility bills, are paid automatically. Be cautious before you pre-authorize direct withdrawals to pay sellers or companies with whom you are unfamiliar; funds from your bank account could be withdrawn fraudulently.
• Pay-by-Phone Systems let you call your financial institution with instructions to pay certain bills or to transfer funds betWeen accounts. You must have an agreement with the institution to make such transfers.
• Personal Computer...