What is E-banking?

E-banking is known as electronic banking, online banking, or internet banking. It is simply the use of electronic and telecommunications networks for delivering various banking products and services. Through e-banking, a customer can access his account and conduct many transactions using his computer or mobile phone.

Importance of E-banking

We will look at the importance of electronic banking for banks, individual customers, and businesses separately.

To Banks

  1. Lesser transaction costs: Electronic transactions are the cheapest modes of transaction
  2. A reduced margin for human error: Since the information is relayed electronically, there is no room for human error
  3. Lesser paperwork: Digital records reduce paperwork and make the process easier to handle. Also, it is environment-friendly.
  4. Reduced fixed costs: A lesser need for branches which translates into a lower fixed cost.
  5. More loyal customers: since e-banking services are customer-friendly, banks experience higher loyalty from their customers.

To Customers

  1. Convenience: a customer can access his account and transact from anywhere 24×7.
  2. Lower cost per transaction: since the customer does not have to visit the branch for every transaction, it saves him both time and money.
  3. No geographical barriers: In traditional banking systems, geographical distances could hamper certain banking transactions. However, with e-banking, geographical barriers are reduced.

E-banking

E-banking in India

In India, since 1997, when the ICICI Bank first offered internet banking services, today, most new-generation banks offer the same to their customers. In fact, all major banks provide online banking services to their customers.

Services Provide Under E-banking in India

  • ATMs. (Automated Teller Machines)
  • Telephone Banking.
  • Electronic Clearing Cards.
  • Smart Cards.
  • EFT (Electronic Funds Transfer) System
  • ECS (Electronic. Clearing Services)
  • Mobile Banking.
  • Internet Banking.
  • Telebanking.

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