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Special Columns
Arindam Chaudhuri, Editor-in-Chief, 4Ps B&M Chief Consulting Editor's Desk
Rajita Chaudhuri
A.Sandeep Editor’s Desk
Banking on the Move is the New Mantra
Technology has become the USP of many players in the banking sector… An update on what’s the current scenario of tech-use in banking
Retail banking in India today is getting re-defined and re-engineered with the use of IT and it is sure that the future of banking will offer more sophisticated services to the customers with the continuous product and process innovations, with the change from ‘conventional banking to convenience banking’ and ‘mass banking to class banking.’ All these changes are really influenced by the changes in the political, economical, social, cultural changes of the country but above all, the business scenario is highly influenced by the changes in the needs and aspirations of the people. But today, the degree of such changes is so fast and more frequently experienced by them. Even the consumer status is changing from isolated to connected, unaware to well-informed, passive to active.

As the outreach is enlarged in the banking industry in India with the increased number of banks and wider network, the customer demands convenience, comfort, speed, cost-effective and quality services in the banking operations. In the recent years, the Indian banking industry saw a host of new generation banks entering the market with their innovative strategies. All these bankers are generally slim in structure but heavily use technology and multi-channel facilities to reach out to a large section of the customers. Technology has played a definitive role in facilitating transactions in the banking sector and the impact of technology implementation has resulted in the introduction of new products and services by various banks in India and enhanced the reach of banks from metros to tier 2/3 cities and rural areas.

At the same time, the payment services offered by banks to the common persons as well as the corporate bodies have improved substantially. This too is partly due to increased use of technology in service delivery and partly due to procedural changes necessitated in the wake of competition amongst the banks. With the introduction of electronic banking, banks are moving their focus of payments from the physical presence of money to the use of electronic money.

Today, electronic banking refers to the use of technology that allows customers access to banking services electronically – whether it is to pay bills, transfer funds, view accounts or to obtain information and advices. It refers to the electronic services that are made available to the customers through phone, personal computer, television and the Internet. Customers can perform banking transactions such as balance enquiries, bill payments, transaction histories, and transfer of money between accounts, obtain quotes and submit equity option and mutual fund offers without having to step into the office on the branch. Payments can be made in India in the form of cash, cheque, demand drafts, credit cards, debit cards and also by means of giving electronic instructions to the banker who will make such a payment on behalf of his customers.

Given all that, technology is actually helping the banks to reduce transaction costs and improve efficiency. The Reserve Bank of India (RBI) as the central bank of the country has creditably been playing this developmental role and has taken several initiatives for a safe, secure, sound and efficient payment system under electronic banking, as these systems are used by individuals, banks, companies, governments, etc. to make payments to one another. In other words, anybody who has to make a payment to any one else can use one or the other form of payment system to make such a payment for which IT enabled channels create a platform.

Clearly, technology has become the Unique Selling Proposition of many players in the industry as it facilitates innovations in all functional management activities – accounting and finance, production and designing, marketing and customer management, research and development activities, and so on. All these innovations have helped the banks to provide seamless, cost effective and world class services to Indian consumers at the same time from Kargil to Kanyakumari and Kutch to Kohima.

Prashant Singh, Vice President & Country Head – FOS & Agency, Royal Sundaram Alliance Insurance Company
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