Impact of Technology on Banking Sector
                     IMPACT OF TECHNOLOGY 
ON BANKING SECTOR
Introduction
 The technology is of great use in the banking sector, it has changed the 
banking industry from paper and branch based banks to digitized and 
network services.
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Online Transaction
 Through e-banking, a customer can access his account and conduct many 
transactions using his computer or mobile phone.
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TYPES OF E 
BANKING
Level 1 
 This is the basic level of service that banks offer through their websites. 
 Through this service, the bank offers information about its products and 
services to customers. Further, some banks may receive and reply to 
queries through e-mail too.
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Level 2
 In this level, banks allow their customers to submit instructions or 
applications for different services, check their account balance, etc. 
 However, banks do not permit their customers to do any fund-based 
transactions on their accounts.
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Level 3 
 In the third level, banks allow their customers to operate their accounts for 
funds transfer, bill payments, and purchase and redeem securities, etc.
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Banking Websites
 Informational Websites – These websites offer general information about 
the bank and its products and services to customers.
 Transactional Websites – These websites allow customers to conduct 
transactions on the bank’s website.
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Importance of e-banking 
 Lesser transaction costs – electronic transactions are the cheapest modes 
of transaction
 A reduced margin for human error – since the information is relayed 
electronically, there is no room for human error
 Lesser paperwork – digital records reduce paperwork and make the 
process easier to handle. Also, it is environment-friendly.
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Importance of e-banking for 
Customers
 Convenience – a customer can access his account and transact from 
anywhere 24x7x365.
 Lower cost per transaction – since the customer does not have to visit the 
branch for every transaction, it saves him both time and money.
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Importance of e-banking for 
Businesses
 Account reviews – Business owners and designated staff members can 
access the accounts quickly using an online banking interface. 
 Better productivity – Electronic banking improves productivity. It allows 
the automation of regular monthly payments and a host of other features 
to enhance the productivity of the business.
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Importance of e-banking for 
Businesses cont.
 Lower costs – Usually, costs in banking relationships are based on the 
resources utilized. 
 Reduced fraud – Electronic banking provides a digital footprint for all 
employees who have the right to modify banking activities.
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