History Of E Banking In Pakistan

Published Date: 02 Nov 2017

Internationally banking system is no longer treated as four walls of a branch. Others countries are giving more facilities in electronic banking system rather than Pakistan. The starting step taken in e-Banking in Pakistan adopted late, but now trying to compete the International E-Banking System. Some year back, bank operation are only perform with in the branch. Whensome private bank enter, number of branches are very few, lack of investment in technology to compete the global e-banking system. With the existences and common use of Internet, Business are diverted to perform there transaction Electronically so the banks have to make use of internet and give services through Internet. Pakistani banks are still far behind their International level. One such example is complete lack of merchant accounts in Pakistan hesitate to perform through internet.

With the instance of Electronic Clearing House (ECH) the local banks also went for on-line banking, still not a proper. Another step is installation of Automated Teller Machine ATM by the banks. While some banks ATMs are used their own network, Some other banks not used their network they using sponsors network and card holder of particular bank used their teller machine.

To increase the number of on-line branches all over effort are made, Electronic banking is now popular in urban areas and usage is increasing day by day but it is difficult to being popular rural areas lack of awareness main aspect low literacy rate in the country. Some professional analyst predict that day by day increase confidence in e-banking will decrease the personal visit to branch and perform any transaction.

Main key issue in e-banking is low number of computer user who are aged more than 40s, young generation adopt this facilities quickly and those people who have internet and computer facility few service offered by bank due to the legal frame work and security risk.

Another factor is offered new service is high costly. Banking sector keep in view to give more convenience to satistfy there customer. Banking sector trying to adapt these high costly new service when this service is continuously being used by customer cover their cost, due to security threat customer often hastate to used this service. Need huge capital in investing in technology by banking system will effect the rate of return expected by share holder and interest rate for depositor.

According to the global market perform electronic transaction increase at normal rate approx trillions of dollars transaction perform electronically in year 2012. pakistan banking system unable to ignore this rapid growing aspect it will give boost to economy. Pakistan must have to create e-commerce infrastructure. Its include three pillars "legal framework" Risk and security of transactions and banks e-readiness.

THE POPULAR SERVICES UNDER E-BANKING INCLUDE:

Automated Teller Machine (ATM)

Credit Card

Debit Card

Electronic Fund Transfer Service

Mobile Banking

Internet Banking

Telephone Banking

SMS Banking

AUTOMATIC TELLER MACHINE (ATM): ATM is known as machine which helps account holder of bank take there money at any they want. This service gives convenience to customer if they need there money after banking hour. Its include money other functions like check balance inquiry, mini statement, utility bill payment, fund transfer etc. ATM were installed any location easy for customer access don’t have to go bank and with draw money like shopping mall, airport railway hospital etc All this works perform electronically with the assistance of internet.

CREDIT CARD/DEPOSIT CARD: The Credit card refers to used money and pay after. Customer no need to carry cash when they want to spend but with a certain limit allowed by bank. bank pay on customer behalf after certain duration customer have to pay back, no interest will charge if payment were made on time after that interest will be charge and so on. The debit card refers to customer used there card and spend money will directly deducted from account. Any account older can open there account and get this card easily bank gave security code personal identification number (PIN) to secure from unauthorized person. Customer can not spend more than balance available in there account.

TELE-BANKING: Tele banking starts performing in 1970s in united state and other developing country. In beginning it is used by corporate client who have large amount of transaction. They make transaction with one Computer to another Computer with the use of any paper, amount credit to party to another party

MOBILE BANKING: Now mobile banking rapidly become more popular day by day. With ease of mobile phone availability account holder used mobile banking and know there balance and pay utility bills with single massage, Also pay there mobile phone bill in case of post paid or if prepaid buy card voucher with a single massage and it is quit risky from other services.

FEATURES OF E BANKING OR INTERNET BANKING:

It is doing banking transactions through our home P.C. The banks that do business through net have Websites. The customer clicks into the Website and gets the history of the bank. Then he can demand the necessary application form through the net. He fills in the form and passes it on to the bank. The bank then sends a UPP (Unique Personal Password) for accession to its computer. Therefore, a customer must have a P.C, a modem, an internet.

Today in Pakistan almost all commercial banks have installed their own ATM network machine and issued debit and credit card to its customers and have joined one of the two operating ATM Networks M Net and One Link.

The following online banking services and products are provided by the banks of Pakistan:

1. Inquiry:

Inquiry about the following things:

Bank Statement

Statement check inquiry

Checking of the balance

Fixed deposit inquiry

2. Payments:

Direct payments

The funds transfer

Payment of Utility bills

Payment of credit card

3. Request:

Demand Draft request

Request for Cheque book

Stop payment requests

Request for Credit/Debit card

4. Download:

Bank Statement

Personal Profile

These are the basic facilities provided by the banks in Pakistan which includes inquiry regarding checking of balance, online payments via internet and requests for cheque book, demand draft, debit and credit cards. It also provides facility to download personal profile and bank statements.

PROBLEM AASSOCIATED WITH E-BANKING

Electronic banking has lot of Benefits, and there are some problem faced by both side consumer and Bankin electronic banking. The main problem are as follows:

Risks OfSecurity:

Security is an important issue in online banking. The major security risks are as follows:

Fraud in Transactions

Nowadays the fraud is common on internet and it has a lot of effect on the electronic banking in a number of ways, Personal Computer can be easily hack and take away important information by using another computer.

Fake Bank Websites/Spam email:

Sometimes emails from the banks or managers etc in which the title of banks or used having fake email addresses and when customers tried to give personal details then all the necessary information is hacked by the people who have sent these fake emails and then they might use these emails according to their own wish.

Trojan Programs:

The Trojan horse programs are used by the hackers to hack the important personal information of customers. So when the customer opens the unknown and suspicious email address or web site, the Trojan horse will automatically install in the computer and customers did not have any knowledge of that and when customer opens the bank website then customer becomes a victim of hackers and they hack the account and passwords all the information and detail send to hacker.

Power Failure

Nowadays under developed countries like Pakistan is facing a lot of problems like light fluctuation and mostly people don’t afford generators or UPS (Uninterrupted power supply) at homes and customers are scared of conducting transactions at homes because they might loss the money when they are doing financial transactions and light fails then consumer faced problem either the transaction has been successful completed or not.

Customer Skills:

The customers should have strong computers and browsing skills for using the internet banking and conducting the transactions online. Sometimes customers with the less sufficient knowledge get confusion of how to use the electronic banking. Another reason in customers finding difficulty in using the online banking is when the page layout of bank website is change and then customers have to face confusion and have to invest more time and this cause delay in conducting the online transaction.

ATM Theft

The robbery of money when people are doing transaction by ATM machines also became common in Pakistan and in big cities like Karachi and Lahore these incidents happened a number of times

OPPORTUNITIES OF E-BANKING

Three main factors, quickness, easiness and cheapness have become the catchwords for the competitiveness and usefulness of all the business operations. Particularly it is commonplace today to say that banking is undergoing a radical transformation. That is why bank has to rapidly increase there IT investment, those banks who have effective technology resources win the race in E-banking opportunities and take advantage.Towards the present era, characterized by rapid changes and increased challenges in various fields.Banking is service-oriented industry In order to meet the challenges of competition in banking sector have to introduces new product and services of electronic banking.E-Banking made its debut in UK and USA during 1920s. It became popular during 1960s through electronic funds transfers and credit cards. The concept of Web-based banking came into existence, in Europe and USA in the beginning of 1980s.. It is a matter of great satisfaction that the e-Commerce is greatly assisted by the e-Banking through electronic cash cheques and smart cards.

Web Based Customer Service

Information Technology plays an important role is creating customer service. Customer who are failed to perform any transaction online, In future they are not trying to attempt online transaction any more and hesitate to used its again. Web based customer services build confidence for this type of customer to used online facility by helping step by step.

Websites Design

The primary infrastucture for internet banking is website. Which enhance the banking sector by using globally all over the world, its gives benefits to both organization and customer, customer are satisfied with this fast available service and bank give quality service to there customer through internet banking. The key factor is to reduce frastraton of customer while navigating on website. The virtual nature of website is to communicate with customer with use of text, animations and graphics

SMS ALERT

Now a days every one have mobile phone and its convenience to bank sent sms to alert there customer each transaction performed. Whether deposit of payment or withdrawal or service charges. Customer will fell more satisfactory about there each and every transaction.

Chaque and Cash Deposit ATMs

With the help of Automatic Teller Machine bank have to introduce chaque and cash deposit service at any round of time. Through Automatic Teller Machine customer also deposite there cash and chaque after banking hour.