Assignment on Online Banking

term PAPER ON ONLINE BANKING table improvement IN BANGLADESH 1. DEFINITION OF ONLINE BANKING Online cashboxingis a renovation offered by swans that on the wholeows narrationholders to introduction their write up data via the network. In assemble to take advantage of online banking, an account holder would need to meet some(prenominal) techno logical requirements, much(prenominal)(prenominal) as having a personal computer with earnings access and web browser. If those conditions atomic number 18 satisfied, online banking keep be performed from anywhere in the world.To minimize the risk of fraud, online banking is enabled through with(predicate) a secure server, which grants the case-by-case a private access to his or herbankaccount. Online banking is de constricted to streamline banking chores that other require considerable cartridge holder and effort. Thus, online banking facilitates direct access to account details, enables impart of gold, all(prenominal)ows for multiple elevations earningss, and performs an array other proceeding. Online banking is easy twenty four hours, sevensome twenty-four hourss a week, regardless of the banks working hours. Today, most banks offer online banking helpings. . HOW some(prenominal) BANKERS PROVIDE ONLINE BANKING SERVICES IN BANGLADESH Bangladesh Bank Governor Dr Atiur Rahman said 79 percent institutions under the dry lands banking sector atomic number 18 providing online service at present. He said, 37 banks ar providing all- give away online service, while half dozen are imbibeting preparations to earmark online service. Almost 79 percent institutions are under online service today. Dr Atiur came up with the comment at the inauguration of the quaternate International e-banking and Mobile Commerce Conference as the chief client at a hotel in Dhaka Monday 10th July2012Science and development chat Technology Ministry Secretary Nazrul Islam Khan, Bangladesh Telecommunication Regularit y Commission Chairman customary (Retd) Zia Ahmed, FBCCI President AK Azad, Chief Marketing Officer of Eco-Bharat Anand Ramanand, Dell Bangladeshs ground Director Sonia Bashir spoke at the inaugural session. Dr Atiur said, 23 banks were given the approval of providing online function up to June, 2012. Amongst them, 14 banks see al crap started the service. 3. PROSPECT OF ONLINE BANKING SERVICE IN BANGLADESH Information engine room surround interpolates rapidly.It is estimated that the number of mesh users in Bangladesh will increase in a new-fashioned years. The number of corporal branches will be decreased (the pro turn on of physical branches will change to advice and support centers) and most of the transactions will be concluded via of import e-banking channels online Internet bank and m-banking work. Rapid growth of e-banking in Bangladesh is anticipateed. 4. gain OF ONLINE BANKING SERVICE IN BANGLADESH What are the three extensiveest things about the Internet? E- mail, music, and online banking Whether for the gubbins or the control, online banking is an aspect of banking that nobody spate resist.Our children will probably laugh when we tell them slew used to actually go to a bank to mystify bills. Online banking rocks Many of the benefits of doing your banking online are obvious You dont have to arrest in line. You dont have to plan your day around the banks hours. You raise take care at your chemical equilibrium whenever you want, not fair when you get a tilt. thither are some hidden benefits too. As a young bank guest, youre just learning how to manage your m sensationy and observe your pass patterns. Online banking allows you to inhabit your currency on a daily basis if you want to.By retentivity close tabs on your funds, youll al shipway be aware of whats happening in your bank account. For those experienced spenders, this option is far more(prenominal)(prenominal) appealing than the fulminant discovery that youre bro ke Its also helpful to watch how much pursuance youre gathering on investments and savings or what service charges you have incurred. What to expect Here are some of the features accessible through online banking View balances Checking your balance doesnt require much work. You simply drive Account balances and take a look at your balance and past transactions.If you have more than one account, you flush toilet also do transfers between accounts. Pay bills To pay your bills online, you just need to add to your account the names of the companies you wish to pay bills to. In the Pay Bills section, select Add payees, search for the name of the company and aim in the account number for each company. You can also sign up for the E-bills service that sends you a bill by e-mail preferably of a printed one by regular mail. Transfer funds When you select Transfer Funds, youll be asked where to transfer the gold to and from, when, and the enumerate.Set up recurring bill payments or tr ansfers If you obtain a regular payment both month, it ability be convenient to set up an automatic withdrawal from your account. monitoring device CIBC investments If you have any CIBC investments, you can keep an eye on those stocks or mutual funds here. Send and play an INTERAC e-TransferTM2 This could be the end of the natal day cheque You can receive transfers from other peoples accounts, or set up transfers from your account to someone elses. The recipient will get an e-mail notifying them of the transaction.View CIBC indorse* accounts Always a honorable place to monitor your spending. You can make your accredit card payments online, right from your account. Order cheques We dont need them much anymore receivable to online banking and debit purchases, merely if you still use cheques, you can recite them directly from the CIBC website. Take control Online banking helps you become more of a banker, streamlet your accounts like a small business that you control every day. erstwhile you get started, youll be hooked. Soon enough youll be compriseing your bank account as often as your e-mail. 5. FUNCTIONS OF ONLINE BANKING SERVICE IN BANGLADESHOnline banking is the confide of fashioning bank transactions via the Internet. It will give you an excellent prospect to bypass the time-consuming, paper-based aspects of traditional banking in give to manage your finances more efficiently. By switching to electronic bills, statements, and payments, the average American household can take over 6. 6 pounds of paper in one year And you can obtain any fraudulent transactions faster than if you received a statement by snail post. Thanks to innovative technology and the Internet in particular, we no wideer have to leave the house to make payments.Online banking is available 24 hours a day, 7 days a week, so you can do it anytime, anywhere. Online banking allows us to perform various services with the click of a mouse. You can 1. Pay a bill. Electronic bill payment service allows a bank depositor to send capital from his or her online account to a creditor or merchant, for example to a public utility or a plane section store. There is no need to stand in a tenacious line on a weekend morning to handle your transactions The payment is practical(prenominal)ly instant, though some monetary institutions can holdup until the next business day to send out the payment.If it is necessary, the bank can generate and mail a paper cheque or bankers drafting to a creditor who is not set up to receive electronic payments. 2. document payments in advance. close to banks offer customers the ability to schedule a payment on a specified date. Once the amount is entered and the payee is checked off, the funds are automatically deducted from your online bank account. It is especially useful if you always halt due dates. For example, you can schedule credit card or mortgage payments to make sure that you will not incur late fees and impai rment your FICO score. 3.Transfer funds. Do you want to send money quickly and securely? With online banking, you can make money transfers between your own accounts, or send money to a third party account. All you need is recipient/payee education and enough funds in your account. Quite often, the operations are performed in real time. 4. Manage all your accounts in one place. Online banking is a great time saver because it provides an opportunity to handle several bank accounts (checking, savings, CDs, IRAs, and so on ) from one site. Most new accounts you open will be automatically added to online banking. . View images of your checks online. Do you need a copy of a paying(a) check? With online banking, you can view and print scanned images of the front and back of all checks you have written. It is easy and convenient. 6. Apply for a loan or credit card. Having an account online, you can apply for a credit card or a loan (a car loan, a student loan, a mortgage, a home equity l oan, etc. ) from the same bank. If you have a good credit score and long relationship history with your bank, your application is belike to be approved. 7. Purchase and manage CD accounts.If you have some amount of money you want to invest, you can purchase a certificate of deposit from your bank. Online banking lets you compare all available offers and their damage, for example APY or maturity periods. When you plump for the purchase, the funds will be automatically deducted from your account. 8. Order travelers checks. You can order American Express Travelers Cheques online. The bank will typically charge your online account for the amount of the cheques you bought and an express delivery fee. 9. Increase your overdraft. overtaking into the red shouldnt leave you red-facedYou can increase your overdraft online. Log in to online banking and click on Overdraft in the menu. 10. Order a cheque book. execute yourself at least one trip to the bank by guild cheque book online. You w ill need to visit your bank formerly when you get a confirmation means that your cheque book is ready for collection. 11. View up-to-the-minute account statements and balance. There is no need to inhabit for the bank statement to arrive in the snail post to check account balances. You can view all transactions and withdrawals every day just by logging in to your online account.In addition, you can immediately scar errors or unauthorized transactions in the statement. 12. View automatically updated spending report. All your purchases are sorted into familiar categories automatically no good to save, no expenses to enter. It is easy to see where your money goes 13. Track your payment history. Online banking gives you an opportunity to search your payments by transaction type, date, description or amount. When did you last pay Company X? When did you buy your computer? To whom did you make your most recent payment? Your bank knows the answers. 14.Integrate the data with personal finance programs. Online banking lets you import electronic payment data in personal finance parcel such as Quicken or Microsoft Money. You will be able to access your online accounts directly from your personal finance program. An Internet connection and online account log in information is required. 15. Change contact details. Have you moved to a new house? Changed your telephone number? You can log in to your online account and change contact information (e-mail address, telephone number, password, etc. ). It is more secure than to send this information by e-mail. 16.Utilize investment research. You can receive real-time quotes, analytics, news and stock commercialize information to make a more educated decision. 17. Take advantage of online brokerage. Internet banking lets you invest online. You can place and confirm trades 24 hours a day, seven days a week. Most banks provide a wide range of money market instruments from various issuers. 18. Get alerts. This service allows y ou to receive timely e-mail messages from your bank about any critical changes related to your Internet accounts. For example, you can get alerts when you make a withdrawal or change your contact information. 9. command terms and conditions. Did you forget your interest rates or payment due date? You can verify all information about your account online. 20. Chat with your customer assistant department. If you need help, you can send message to your banks customer assistant department. They will help you elaborate your problem. 6. SWOT ANALYSIS OF ONLINE BANKING SERVICE IN BANGLADESH SWOT Analysis To experience out the viability of a particular product we moldinessiness perform a SWOT Analysis of the product. This will analyze the Strengths, Weaknesses, Opportunities ,and Threats of the particular product.For analyzing the performance of Internet Banking in Bangladesh we the following SWOT Analysis is considered. Strengths Internet Banking is new in our market. Only a few banks are now offering net income services in solving banking problems. Most of the banks are offering whole accounting information online. Actual fund transfer and fund spending is not possible in all the banks that are offering lucre services. So this product will enjoy the benefit of a branch mover. It is cheap both for the banks and the customers. The bank will be able to discredit down the overhead costs and make more profit out of it.Internet banking will require less manual workers. Again the customers will be able to save time as well as money for their transaction needs. Internet banking is convenient as the service is available all the time at just a click away. Weaknesses Security breakdown The system will have a problem with the identification of the individual who is initiating the transaction. In Bangladesh, the identification of an individual is not yet supported digitally. So in that respect will be a problem in mournful to the Internet era for banking purposes just now.First we will have to develop a digital database of the users of the internet banking services. The transaction can be cancelled entirely via internet. The internet fundament of our country is not that much supportive to provide all time access to the web. So there will be a problem in executing the service with its full functionality. Opportunities Non-branch banking is seemly popular in our country. Many banks are now offering non-branch banking facilities. A person can withdraw or deposit money in any branch of the bank he has account with. The internet services are becoming very common to us.So a service offered through the internet will be widely accepted in the abutting future. Threats People have concern about security and privacy. They like to disembodied spirit their money with their hand. They actually dont believe in virtual money transfer. In the field of IT new technology is coming every day. The one which is very popular today might get obsolete tom orrow. So to have a competitive edge over the competitors the banks must always update their services. The movement towards online banking might marginalized the customers who do not have internet access or who are not technically sound.Despite the figurehead of online Internet service in Bangladesh, its scope is largely underutilized. The reasons include game service charges, lack of awareness, poor telecommunication systems, regime polity, low get power of potential clients, and lack of institutional support. 7. CHALLENGES / RISKS OF ONLINE BANKING SERVICE IN BANGLADESH broadly speaking it is believed that banks in Bangladesh are facing different problems adopting e-banking. Inefficiency and lack of adequate cognition of the top management of the last generation about ebanking may have to be put at the first place.The top management set the way for future development. For the change they must have soundless its significance and prospect. Only so, proper strategic plan co uld be done, hold adjustment with changing national and international business and technological environment could be made, the coming challenges from the national and international. competition happyly faced, and the market take retained and gained. The lack of communication channel and technological and technical infrastructure support may be seen as the second crucial challenges of e-banking in Bangladesh.It is not enough that there are enough communication channels, but they must be efficient, competitive, competent, cost effective and supportive to the services. In the millennium of ICT every nation has to think global, so worldwide efficient networking and WAP have to be ensured. Ensuring mature technology is also very cardinal for successful introduction of the e-banking which includes adequate software. Modern technology is available but oft very costly, but the countries like Bangladesh have other decisive comparative advantages that could be used to compensate the c ost of the modern technology.In this way, the modern technology could be made economically viable, cost-effective and competitive even in the world market. Qualified human resource is another factor that has to be considered, which means experts have to be made available in the market. In the long run such services cant be made competitive with hired or imported human resources. So, several(prenominal) educational institutes must be established for the supply of the experts for the management of the hard- and software of the sectors. It is expected that a part of the existing employees both from the rank and file may resist the change.To motivate and integrate them in the change, training and change of direction program must be launched. Security of the services is very important to popularize it. To protect the service from piracy and fraudulency reliable security systems must be ensured. In this regard, government, banks, and Bangladesh Bank must work together. So and so, ways an d means must be found to protect fraud and money laundering but at the same time ensuring fund transferring. 8. pass / SUGGESTIONS OF ONLINE BANKING SERVICE IN BANGLADESHMost of the countries have adopted E-banking and the consumers seem to like the convenience of E-banking despite some continuing hesitancy. The widespread uses of ATMs has paved the way for great acceptance of other forms of electronic money such as promising cards and POS. Direct deposit, and to a lesser extent, electronic bill payment, are and to a lesser extent gaining popularity. In addition, as more people purchase personal computer and use the internet, home banking should become more widely accepted. But a cashless or check less financial system is still not in the state of foreseeable future.Though there are 28 banks in Bangladesh, for the most part head quartered in Dhaka. Most of these banks do not offer online or electronic service such as Direct Deposit. There are some ATM machines, though not nearly as concentrated as in a developed economy. The Ministry of Science, Information and Communication Technology has given out the policy for the development in the IT sector. The ministry has concentrated on the following sections Human Resources breeding through Education and Training ICT Infrastructure development Research and culture in ICT Development of ICT Industry Development of E-Commerce E- judicature / E-Governance establishment Establishment of lawful Issues. The Government spending in ICT is exit to increase by at least 2% of ADPin coming years. The ICT companies will get preferential terms which will be able to meet up 20% of its tax income expenditure. BCC has attaind a centralized fund for R&D which would sanction contributing 1% of all profits from ICT-enabled services to the HRD fund. This will greatly help the development if ICT in Bangladesh. The software support for internet banking, i. e. FLEXCUBE is available in Bangladesh.Again Bangladesh Governm ent is working on the copyright law and the conservation of intellectual property act. After the successful implementation of all these policies and strategies we are expecting that more than 50% of the banks will be offering internet banking facilities that is now 12% only. E-banking is in its nascent state in Bangladesh. At present, Information Technology (IT) is a subject of widespread interest in Bangladesh. The government has declared IT as a thrust sector and set up a vision of Digital Bangladesh in 2021. But Bangladesh has a long way to go in a very short time to enjoy the fruits of information age.It will be only possible when there will be political commitment with better IT infrastructure, internal network, country domain and above all ahigh speed fiber optic affaire to the information superhighway. In order to ensure a successful practice of e-banking in Bangladesh, we recommend the following. * E-banking systems should be simple to use, fast and user friendly. * E-bank ing services should be standardized so that wherever the solution is used the customer is familiar with the procedure followed. * Government should compel the banking sectors to automate their operation and going online by a specific period. Provide adequate training and technological support to develop the manpower. * Appropriate legal framework. * Proper infrastructure development. * Government should implement the cyber laws to ensure proper security about customers information (i. e. honorable mention card number) . * Government should establish proper educational institution to create efficient IT professionals to support e-banking in Bangladesh. * Developing of integrated e-banking software. Government, in collaboration with the banks, should educate and inform its citizens and customers on the workability and effectiveness of E-banking.This will increase the authority level of customers. * The clearing house operation in Bangladesh should be to the full automated system. * Banks should have adequate research and technological background in this regard. * Bank can charge normal profit to enlarge the market size on the electronic banking products. * Political commitment to improve establishment and institutional strength is essential for successful application of e-banking. * As e-bank users mostly use ATMs and POS in most cases, the banks should emphasize on providing uninterruptible service.