Page 30 - Banking Finance October 2019

ARTICLE

27% and the usage of the Internet and Mobile Banking have
increased by 28% and 83%, respectively, across Asia
between 2007 and 2011, the big picture shows that the
percentage of bank customers, who use net or mobile money
wallets in our country, is still abysmally low. The Global
Findex survey released by World Bank in April, 2018, shows
that 29% Indians are making digital payments whereas in
Kenya 97% and in South Africa, 60% are making digital
payments. In 2017, only 5% of indians, when compared to
21% in Sub-Saharan Africa, accessed Bank A/c from their
phone or internet and only 2% of population owned a Mobile
Money A/c.

Thus, Virtual Banking is as yet at a nascent stage in our
country. Rough estimates suppose that the teller cost is at
Re.1 per transaction, ATM transaction cost at 45 paisa, the
Slideshare.net phone banking at 35 paisa and debit card at 20 paisa but
the Internet banking comes to 10 paisa per transaction. The
The Government of India enacted the IT Act, 2000 with cost-conscious banks in the country have therefore started
effect from October 17, 2000 which provided legal actively measuring the use of internet as a channel for
recognition to electronic transactions and other means of providing services.
electronic commerce. The Reserve Bank of India is
monitoring and reviewing the legal and other requirements Fully computerized banks, with superior management of
of e-banking on a continuous basis to ensure that it would their customer base are in a stronger position to cross-sell
develop on sound lines and the e-banking related challenges their products through this channel. Banks in India are at
would not pose a threat to financial stability. According to different stages of the web-enabled banking cycle yet
RBI Nov.2018 report there are 203806 ATMs and 351859 numerous scheduled commercial banks are in the first stage
point of sale devices operating in India. of internet banking in operations. Undoubtedly, the race for
market supremacy has started compelling banks in India to
Today, Virtual Banking is being used for deposit and adopt the latest technology on the internet, in a bid to
withdrawal of cash, online shopping, bills/Credit Card capture new markets and customers.
payments, hotel/cab/movie ticket booking, payment of loan
EMIs, insurance premia and a host of other usages. To
sustain in the growing competition, commercial banks in
India have adopted several initiatives to improve banking
services and to gain competitive advantage. A number of
Indian banks have implemented Online Tax Accounting
System (OLTAS) for collection of taxes on behalf of Central
Board of Direct Taxes, GOI.

A few banks have also introduced E-Locker facility for their
customers. These days, the banks are making their presence
even on social media platforms like Facebook, Youtube and
Twitter for targeting huge customer base as well as
potential customers; you can find round-the-clock tweets
and comments on the banks' products and services.

Although, on an average the branch usage has dropped by

30 | 2019 | OCTOBER | BANKING FINANCE