What is Internet banking
Internet Banking is the process of financing funds digitally through electronic devices.
E-banking can be availed to customers at free of cost and therefore, customers prefer the comfort or ease of the internet banking and moreover, it is even efficient for the banking institution when their customers can operate their own transactions by themselves instead of visiting the branch.
“The primary advantage of e-banking is the reduction in inconvenience, transaction cost and time taken in performing an operation”
Advantages of Internet Banking
Internet banking provides many benefits to People, They mainly are;
- Cost saving: This is realized through less reliance on manual operations and calling centers.
- Fast Transaction: Internet banking transaction procedures are simple and straightforward.
- 24/7 Availability: About time saving Internet banking is more effective than branch banking because it minimizes the use of traditional branch banking.
- Globally Accessible: Consumers can open new account online, they can apply for financial services from their homes and the result will be less data entry compared to the Traditional system.
The presence of large number of computers connected to the internet has allowed customers to conduct their banking activities from their home, office or even public places.
Brief History of Internet Banking
The process of delivering banking facility to the customers over internet service i.e. Internet banking was first started in the year 1980s.
In the late 80s, the facility of online was familiarized and it was mentioned to a banking institution of using certain accessories through the phone line, and the other term used for the same was Home Banking.
The e-banking facility was first started in the year 1981 in New York along with home banking services by the means of videotext system by Citi Bank, Chase Manhattan Bank.
But the home banking system failed and due to the failure of videotext system except in France and UK.
The first home online banking service was provided by the Bank of Scotland in 1983. The BBC keyboard was used in order to provide the online banking service and this system was called Home link and this service helped the customer to view their banking details online, and also provided various banking facility.
It was Stanford Federal Credit Union, the first banking institution to provide the facility of online banking to all its member in October 1994.
In recent time, there are certain banks which functions as only internet bank, such banks do not have physical branch. These banks provide better rate of interests and other internet banking facilities as compared to other banking institutions.