Initially when banks expanded to different cities and states, they provided branch specific banking. So if a customer has a bank account with a bank in city A, he cannot use the services of a branch in city B. The bank would usually delay the processing of financial instruments issued from some other branches to 2-3 working days. Then came the concept of Core Banking. Wherein, a customer who has an account with the bank can use any of its branches irrespective of the city where he held the account. All branches are linked and it is as if the whole bank is integrated across all the branches.
Core Banking Through E-Commerce
Core Banking is normally defined as the business conducted by a banking institution with its retail and small business customers. Many banks treat the retail customers as their core banking customers, and have a separate line of business to manage small businesses. Larger businesses are managed via the Corporate Banking division of the institution. Core banking basically is depositing and lending of money. Normal core banking functions will include deposit accounts, loans, mortgages and payments. Banks make these services available across multiple channels like ATMs, Internet banking, and branches. Core Banking solutions are banking applications on a platform enabling a phased, strategic approach that lets people improve operations, reduce costs, and prepare for growth. Implementing a modular, component-based enterprise solution ensures strong integration with your existing technologies. An overall service-oriented-architecture (SOA) helps banks reduce the risk that can result from multiple data entries and out-of-date information, increase management approval, and avoid the potential disruption to business caused by replacing entire systems.
Core Banking Solutions is new jargon frequently used in banking circles. The advancement in technology, especially internet and information technology has led to new ways of...