In recent years the various forces that are shaping the global economy, in particular processes of globalization, innovation and technological development, international money forms have had a critical bearing and role in the development of capital and securities market that have expanded rapidly as a result Garrett, In relation to these processes then banks play a vital role.
They are a key element of global economic activity and thus the trends driving changes in banking are in and of themselves reflective of these global trends.
Adaptation and evolution are the key indicators and determinants of continued success and expansion for banks and the transformative technology associated with the rise of the Internet represents both a challenge and a response to challenges for banks. In considering the future role of the Internet in banking it is click at this page examining the historical development and delineation of the functions of banks.
The emergence of models of banking familiar to us is associated with the rise of Italian merchant banks during the Renaissance. Both historically and currently then banks have been associated with developments in accounting procedures, systems dealing with the transfer of payments, new forms of services rendered and the application of technological developments.
It is also then not surprising to note that continued processes of globalization are at the heart of trends in banking in the 21 st century. At the heart of banks role within trade was the need for a way for participants in trade to do so safely and conveniently. From this the system of credit was first used and this had a bearing on the acceleration of the development of international trade, a fact which holds true today even if forms are varied.
The expansion of banking thus can be seen as a process of developing financial systems Essay Writing On Internet Banking were closely linked to trade and in particular free trade. By the end of s it became apparent that new technologies were driving the financial markets to be truly global in the midst of intense competition.
It saw the rise of non-bank financial institutions which sought to provide alternative financial services at both personal and commercial levels. For example, General Electric Capital the Essay Writing On Internet Banking services subsidiary of General Electric Corporation, supplies credit card facilities to department stores and is the largest insurer of homes in the US Heffernan, Similar developments in the UK have seen Marks and Spencer, Tescos and other department stores enter the market offering financial services to their customers.
Consequently the globalization of capital markets can be to seen to have pushed banks to seek to develop themselves and differentiate their services utilising new means in both technological applications and service provision to adapt to an ever increasing competitive environment.
As such it is readily acknowledged that for modern banks the strategic use of technology is now a key factor both in terms of restructuring banking systems and as a method of creating new demands for financial services Heffernan, Thus considering the dynamic growth and expansion of the Internet at the close of the 20 th century it is not surprising to note that the phenomenon of internet banking has expanded dramatically.
Indeed this expansion has been accompanied with increased attention on whether this form of banking will become the dominant form of banking in the future. The use of which it is argued will allow banks to keep abreast of trends of globalization and increased competition allowing them to capitalise on continued technological developments associated with internet technologies that break down geographical as well as functional barriers.
However, the survival of a click here form depends on whether it is able to adapt to providing the most effective and efficient intermediary and payment service for its customers. Therefore in order to maintain competitive advantage in financial markets banks have to keep pace with the changing nature of what constitutes the roles and functions of being such an intermediary Bryan, According to Heffernanthe existence of traditional banks is due to two main reasons: The role of banks as financial intermediaries is Essay Writing On Internet Banking which sees them as providing a whole range of deposit and loan products but the nature of this role may vary in different ways.
The traditional Essay Writing On Internet Banking is one of taking deposits and then lending a percentage of the deposit and according making profits from interest charges. Additionally because of the high cost of generating useful information for lenders in order for them to find the most appropriate borrowers the role of banks in providing such information has become an essential one.
Although modern banks operate on international visit web page global scales dealing oftentimes now with truly global customers as well the basic model and functions of banking has not changed even if forms are varied.
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Yet numerous risks for banks and banking structures have emerged due to this wave of globalization and developments in technology. Examples of these can be seen in the processes of deregulation which have led to the disappearance of old banking regulations Mayer, As a result the range of new products and services which banks must adapt in offering with increased global competition has led them to face new risks as well as new competitors outside the banking system, such as business corporations who have become eager to provide debit services as well.
In general then we can surmise that these risks have emanated from increasing competition, product innovation, the movement of capital markets, increased market unpredictability and the more info of old barriers to the provision of financial services Bessis, Accordingly because of the significant pressures on banks to minimize risks and the requirement of maintaining capital capability, many banks have made the strategic decision to focus on two stable fee-based profit areas, namely retail banking and private banking.
However retail banking is a challenging and tough area due to the amounts of product differentiation between services offered and provided which gives rise large amounts of competition between new entrants and established bank branches. Because they more likely focus on providing services for more well-off individuals, the service demands of these consumers are more sophisticated and professional ones.
For example, private bankers may offer complicated Essay Writing On Internet Banking analysis systems to help clients manage their investment or stock portfolios. Moreover an increasing phenomenon related to clients of banks today are their demands for new money types represented for example by e-cash developments and better profits from their investments all of which contribute to increased pressures for banks.
It is expected an suggested that internet banking may help to solve the problems existing in both these kinds of traditional banking as well as responding in and of themselves for the continued growth of demand for banking online due to customer preferences and needs.
Correct All Writing Mistakes And Plagiarism In Your Essays Now!. Essay on Internet Banking For learning Internet Banking, open an account with internet feature Add More Points to this ESSAY by writing in the COMMENT. Internet Banking Essays: Over , Internet Banking Essays, Internet Banking Term Papers, Internet Banking Research Paper, Book Reports. ESSAYS, term and. Internet Banking Internet Banking Essay My bank is PNC Bank and I chose to write about it and describe how technology has affected the company. Free Internet Banking Essay Is Internet banking the way forward? Introduction. In recent years the various forces that are shaping the global economy, in particular.
First of all internet banking has been suggested as being able to offer economies of scale and low transaction costs. Additionally due to the new target markets which have emerged as a result of internet banking which research suggest seems to be more educated and affluent the advantages of please click for source and lower costs are attractive for online banking users.
Furthermore the continued emergence and use of e-cash it has been argued may cause an evolution or revolution in the traditional banking world lead to increased values and returns in the field of private investment. However, online banking Essay Writing On Internet Banking its risks some of which may be seen as especially problematic for competing banks.
Banks thus must not only compete in terms of the services which they offer but also as to the relative security of their services in comparison with others. It must also be noted that the first investment towards creating an online banking network requires huge capital investment and due to the levels of competition within the sector may in itself led to new entrants failing to make a profit and return on their initial investments.
With these factors in mind then we can summate that online banking forms should correspond to the main trends in financial markets as well as display characteristics of a sound organizational risk management system which helps protect customers and is able to contribute to minimizing existing risks for banks and maximise returns on investment for banks.
To understand the future of banking, it is essential to first appreciate the major trends and changes Essay Writing On Internet Banking have a bearing upon banks in terms of how they operate. This refers to the fact that the geographical location of financial markets operations is no longer important. Examples of this can be seen in the rapid increase of cross-border capital flows and international cooperation continue reading financial regulations and frameworks.
As a result the demands of global customers have pushed banks to adapt and evolve their organizational structures and the way in which bank products are offered. Essay Writing On Internet Banking example while the growth of financial credit markets has bee dramatic and profitable recently it has been rocked by a series of scandals global in their proportions in the UK, US after a brief recovery in international systems as a result of the Asian economic slump Strange, Additionally, from a political and social functional perspective of globalization there is an increased awareness of problems focused on the weak points in the traditional this web page system.
Consequently customers demand that bank minimize the failure of investment by using sophisticated financial instruments and effective services. It is necessary to ask whether there are possible changes that might be made in the traditional financial system as a result of these trends. In recent decades, the relationship between financial institutions and regulatory organizations has changed because of the acceleration of globalisation.
Both in theory and practice, political considerations on the economy and the pressures on and from banks were here Aronson, In this aspect banks have been able to put pressure on governments in order to force governmental changes in policies to improve efficiency and productivity.
Thus one of the main reasons for regulating banking activities then as well was in order to enhance the ability of governments in raising revenues. However the emergence of a globalised economy has led to a significant re-conceptualisation of this factor, Spong, As such this analysis presents the reasons for regulating banks today as being related to issues of taxation, of maintaining money supply controls, of protecting some financial suppliers from competition, and the protection of depositors and bank solvency Benston, In addition, due to globalization banks have expanded their business to include foreign trade finance lending in different countries which can be called international banking or multinational forms of banking.
Unsurprisingly international banks have suffered the stresses of increased government influence and controls over the ways in which they invest and what types of business they undertake. As a result of this it is argued that the process of selection of the most effective banking form is less through competition as opposed to being through the actions of politicians and regulators Jones, Research has been carried out in the USA, UK, Japan and European Union which has demonstrated that there is still a large deficit in the coordination of international bank supervision Canals, Although it is said the governments have gradually reduced the importance of their roles in banking innovation within the relationship between banking activities and the supervision of government is a key element for Essay Writing On Internet Banking growth quality financial products and services in the global economy Avgerou and La Rovere, The banking industry is also highly affected by the evolution of technology.
In this area some of the most dramatic changes in banking business have occurred and are occurring. This is not surprising when it is considered that technology has enabled the banking industry to innovate in terms of new ranges of financial products, distribution channels for these services and better customer relationship management systems.
For example, the computerization of the standard transaction model has reduced the need for paper records and checks. However, these changes present both opportunities and threats. The developments taking place in information and communication technology have increased the levels of competition for financial institutions. Powerful forces then have shaped the banking industry including it must be noted changing customer needs and their choices of financial services.
By the middle of the s internet based services had rapidly emerged in usage and coverage, such as for example E-mail and these non-financial usages have led to their application and deployment in creating a new way of banking Wiggins, Furthermore, there has been a trend for individuals to invest their Essay Writing On Internet Banking such as their retirement money rather than saving it in traditional deposit accounts in banks so as to seek higher return rates on their money which reflects these changing customer needs.
While traditional banking systems offered high level of commercial risks a Essay Writing On Internet Banking emerging feature has been the alternative of non-banking sectors, including for example mutual funds. They are more aware and indulge more in financial analysis and the possible options available to them for increasing the value of their monetary assets, thus traditional banking systems appear to be less attractive to these sets of customers than they were in the past.
This makes banks develop or seek to develop ways of meeting this challenge and be responsive to the key trends related to click operating in the banking this web page. Customers it seems are enthusiastic in relation to these development with research for example from Canada showing a majority declaring their willingness in dealing with all of their bank bills or investments via the Internet by Hien, To consider modern banking in the context of a traditional model, banking activities in industrialized economies can be seen as being a function of their role as financial intermediaries between depositors and borrowers as well as being instruments of payments.
In regards to the former the intermediary and payment instrument have been identified thus it is necessary to address the organisational structure of Essay Writing On Internet Banking which are most successful in carrying out these identifiable functions.
According to Kovacevichwinners in this industry will be those who can master the management of information and use it to give their customers what they want as well as when and where they want it, or in other words those who can assimilate knowledge in such a manner as to be responsive to dynamically changing customer needs and preferences.
Therefore effective banking structures are those that are able to support the interactions of information and financial services. In other words banking activities that can be divided into four levels are closely related to profitability. Namely treasury and banking transactions, intermediation, financial assets, and long run activities including fixed assets and equity plus long term debt management and financing are major visit web page of banking operations.
For example, many banks are engaged in international or multinational business for a short time due to globalization, their presence in which does not contrary to the basic banking model, but makes them pay more attention to the Essay Writing On Internet Banking of Essay Writing On Internet Banking global customers and which requires links to global targets matching with their business decisions.
New challenges can be created during the process of internationalisation as a result of the major trends in banking analyzed previously Classens and Jansen, Nonetheless, a recent view on traditional banking model holds that the contribution of physical banks to the growth of the global economy has been diminishing significantly over time; new financial instruments and technologies such as online banking will not be then be seen as a one component of a new strategy but in effect the new strategy for banks to maintain their traditional functions in the face of external competition Baker, Therefore there is a multiplicity of arguments concerning the new form of banking model yet a recurring emphasis on the dominance of the internet to the future form of this model.
Furst and Nolle defined the term of electronic banking as meaning a distant delivery channel which is used for banking services. Thus with the increased competition, increased costs, changing customer needs and preferences Essay Writing On Internet Banking with the rapidly changing global context in which banks operate one of the key questions to be asked is that along with the electronic provisions of services will there be a reduction in the actual physical presence of banks and thus an end as such to the physical bank to be replaced by an online electronic one.
E-banking is a global phenomenon yet the newness of technologies associated with it should not be taken to mean that electronic banking itself is new.
We can see developments in electronic banking as far back aswhen the West Union Telegraph Company headquartered in New York began to offer a nationwide money-transfer service Ridgway, The internet exploded onto the international scene in the s and s and the rapid click here of the technology and the possible applications led to many surmising and trialling the offering of banking services making use of the medium, yet such efforts were viewed as being risky as well as generating only minimal profits.
This may be the main reason for low levels of popularity towards banking online historically and to a degree presently. Because of the low percentage of customers who have access to such services and the huge cost of setting up internet banking web sites, it is unlikely that at present internet banking is having a major influence on the profitability of most institutions.
Yet the continued roll-out of internet technologies such as always-on broadband connections may it can be hypothesised dramatically alter this situation over the coming period. Those banks that rely primarily at present then on internet banking must be able to afford the huge costs involved in setting up their operations as well as run the risks feared by smaller institutions that has led to their closure related to making such a large investment and risking it on future profits.
However the usage of ATM machines has spread rapidly because of driving forces in the economic situation at that time. Analysts such as Moore believe that rising inflation and interest rates are key contributors to the strategy made by banks towards attracting customers through using ATMs.
On the one hand customers require cheaper and more convenient ways to withdraw and access their money; on the Essay Writing On Internet Banking hand banks are able to afford the investment of installation of ATMs to maintain consumer loyalty through charges levied on the use of such systems. ATMs were seen to be a vehicle to help banks compete with other financial sectors world wide at a much lower level of cost than through the opening of physical bank branches.
One-on-one writing assistance from a professional writer; Advanced pro-editing service Essays Related to About Internet Banking. 1. Banking On The Internet. Essay UK, Internet Banking. Available from: Essay UK offers professional custom essay writing, dissertation writing and coursework writing service. ADVERTISEMENTS: In this essay we will discuss about Internet Banking. After reading this essay you will learn about: 1. Meaning of Internet Banking 2. Objectives and. HISTORY: ONLINE BANKING. Online banking used to be carried out through the online media in the s (Tan & Teo, ). During the late 80s, a remote computer could.