Banking Services and Information Technology: The Indian Experience

Banking sector in India has been a major beneficiary of the inroads made by information technology. Many new processes, products and services offered by bank and other financial intermediaries are now IT-centered. Effective integration of technology with sound business practices requires business process re-engineering and banks in India need to follow up on the beginning made in the regards. Most of the initiative regarding technology are aimed at providing better and more efficient customer service by offering a multiple options to the customer. The death of distance, which is a by-product of technology, has become a reality in the banking sector. Technology is also playing a key role in banks’ strategy for gaining a competitive edge. Another major development witnessed in recent years is the growth in multiple delivery channels to customers such as inter-based banking, mobile banking and anywhere banking. This has benefited the customers and the banks alike. These developments have, however, also posed certain challenges. In a world where geographical barriers are losing significance, it is essential that security is given prime importance in transitional scenario where large sums of money are at stake. While the challenges relating to physical security could be confronted with relative ease, the position is much more complicated in respect of IT security.