Are technological flavours in the banking Industry really flavouring the banking business?
By Ahmed Noushad
Ask your forefathers what banking was like, and make the long story short, it is paper-work after paper-work! Count to roughly five years ago, and you’d find that Banks in Bangladesh were a place to make deposits and withdrawals through formal system of procedures and their systematic execution. Well, only five years ago farmers in Bangladesh began to rely heavily on chemical fertilisers, or use tractors to plough their lands, or think of using GM crops. All the traditions had to phase out to keep-up with the technologically sensitive society. Banking notions have similarly been affected since advanced and obtainable technology found their way in to the society, being more at our finger-tips than on paper.
Banking is a business in itself like any other. And to attract potential customers, the services a bank offers should essentially meet the expectations and requirements. With more and more banks making themselves seen in the market, competitions have become fierce making customers aware of their importance, and providing them the choice to ignore them in search of more competitively advantaged options. And with the addition of modern technological facilities, the situation will become more desperate than ever, if Banks fail to embrace this challenge and provide the demanded quality service.
Most of the changes in the Banking Industry can be attributed to the impact of the technological developments in collection, storage, processing, transmission, and distribution of information. With Imaging Technology, EDI, Smart Cards, and other technological advances, banks can now take the form of being information servers where they hold the role of producing, organising and transferring information to the society. Besides these, banks can opt for moving in to consulting business, which in fact have already been in the minds of several banks. A bank can work with an individual firm (or an industry) to develop an information, payment, and financing system that are most appropriate for the business. ‘For example, a bank could work with a hospital to develop an electronic filing system that would use imaging technology to coordinate images of handwritten prescriptions and doctor’s notes, medical reports, billing records, and patient identification information. An EDT (Electronic data Transfer) system could be set up to speed billing between the hospital and insurance companies (and their respective bank accounts). Smart Card technology could allow quick identification of patients’ health data and payment information; plus, it could be used to allow medical personnel (and patients) quality access to personal financial information’, Ronald R. Graczyk writes on technology’s shift in the Banking Industry.
With the waves of technology hitting the society, providing them the scope of entertainment and shopping through a mere swipe of a screen, it is more ardent that banks provide customers something to swipe for. Considering the current downturn in the Banking Industry’s economy, it is more vital that banks quickly adapt and adopt technologies which could be vital to their recovery.For instance adopting paperless technology in transactions and payments has cut costs and time. Likewise, customers can look forward to a more streamlined experience at their fingertips, without the issuing of paper which must later be filed or disposed of.
With the proliferation of mobile banking, banks are beginning to focus on how to use technology to offer more remote services. For example, teleconferencing instead of in-person meetings, or secure self-service checkouts at the supermarket, will further ease the process of transactions for both the bank and the customer. It is very feasible that such adaptable mobile banking shall one day become the future of the banking industry, and so implementing the most up to date technologies has never been more important. However, the far more concerning aspect of this advent of technology in the banking business is the combined effects on the industry rather on individual aspects.Traditionally, banking was all about financial services, or more involved with savings, transfers, loans, and interests to put it coarsely. The technological shift in banking has been pushing the banking business to involve with security investments, insurance services, and more drastically using a more advanced information processor.
The greatest and most known fact of involving too much technology is quite known to everyone and every business, the Cyber-Crime. Banks are most prone to such attacks owing to their involvement with customer’s finances. The constant changes in the internet world are providing more and more hackers with opportunities to seize. According to Australian Banking and Finance, there has been a shift away from short-lived cyber attacks, focused on grabbing as many bank details and card numbers as possible. Instead hackers are moving towards longer-term infiltration which passes below the radar of current cyber crime prevention teams. This in turn forces Banks to adopt expensive measures to guarantee the safety of their customer’s deposits, besides their trust. ‘For banks, this means a need to keep abreast of the shifts in the type of cyber crime that is being carried out, and to adapt their security and online teams to prevent damage. A security slip can badly damage a bank’s reputation, so it’s vital that they head off current threats, in order to keep their customers’ trust’, Tristan Anwyn speaks on cyber-crime and banking.
Looking at the bigger picture, the question that needs to be quickly answered is; are banks really holding their essence in their process of adaption and adoption? ‘This shift in core concentration also poses the danger of banks lacking a central focus because they are pulled between the financing and the information-processing directives. Changes in society have placed banking on the crest of the technological wave, leaving banks to negotiate the wave, to determine what role they will play in the next generation’, Ronald R. Graczyk writes.