Core Banking 1

Vivek college of commerce

CHAPTER 1

1.1 INTRODUCTION

Core Banking Solutions is new jargon frequently used in banking circles.

The advancement in technology especially internet and information technology has

led to new way of doing business in banking. The technologies have cut down

time, working simultaneously on different issues and increased efficiency. The

platform where communication technology and information technology are merged

to suit core needs of banking is known as Core Banking Solutions. Here computer

software is developed to perform core operations of banking like recording of

transactions, passbook maintenance, interest calculations on loans and deposits,

customer records, balance of payments and withdrawal are done. This software is

installed at different branches of bank and then interconnected by means of

communication lines like telephones, satellite, internet etc. It allows the user

(customers) to operate accounts from any branch if it has installed core banking

solutions. This new platform has changed the way banks are working. Now many

advanced features like regulatory requirements and other specialized services like

share (stock) trading are being provided. Core banking solutions are very helpful to

SME industries.

Core Banking Solution (CBS) is networking of branches, which enables

customers to operate their accounts. And avail banking services from any branch of

the Bank on CBS network, regardless of where he maintains his account. The

Core Banking Page 1


technologies have cut sown time, working simultaneously on different issues and

increased efficiency. The platform where communication technology and

information technology are merged to suit core needs of banking is known as Core

Banking Solutions. Here computer software is developed to perform core

operations of banking like recording of transactions, passbook maintenance,

interest calculations on loans and deposits, customer records, balance of payments

and withdrawal are done. This software is installed at different branches of bank

and then interconnected by means of communication lines like telephones,

satellite, internet etc. It allows the user (customers) to operate accounts from any

branch if it has installed core banking solutions. This new platform has changed

the way banks are working.

1.2 HISTORY OF CORE BANKING

The major objectives of bank automation are better customer service,

flawless book keeping and prompt decision-making that leads to improved

productivity and profitability. The concept of bank automation started in the year

1981, but it was during the period 1984-1987 banks in India started the branch

level automation, making use of the then available MSDOS based stand alone

computers. This initiative was taken by the banks on the basis of “First Rangarajan

Committee report” on bank computerization submitted in the year 1984. ALPMs

(Advance Ledger Posting Machines) were the fashion in those days. However, the

pace of bank automation was very slow in the banks primarily owing to the lack of

trade union consensus on bank automation.

Core Banking Page 2


Another committee was in 1988 under the chairmanship of Dr. C.

Rangrajan, the then Deputy Governor of RBI to slate down a perspective plan on

automation of banks for a five year period. This paved way to the implementation

of multi-user Total Branch Automation packages running on a LAN (Local Area

Network, either on a Network or a UNIX operating system. With the

implementation of TBA, banks started to offer the facilities of exclusive Customer

Terminal, Single window transaction, on-line and off-site ATMs, Tele-Banking

etc.

But with the advent of new generation private sector banks in India during

1994-1996, the real era of bank marketing started and these banks started to offer

anywhere and anytime banking facilities to its customers. This was possible for

them mainly owing to the fact that they opted for the implementation of a WAN

(Wide Area Network) based centralized banking solution rather than a LAN based

branch solution to network their limited number of branch banking solution to

network their limited number of branch outlets.

The old generation banks in India hesitated to follow this banking fashion on

account of its large network of branches on one hand and the then prevailing

exorbitant IT cost on the other hand. But with the globalization and liberalization

of Indian market and with the enactment of TRAI (with a mission to create and

nurture conditions for growth of telecommunications in the country in a manner

and at a pace which will enable India to play a leading role in emerging global

information society) during the late nineties, there happened a drastic reduction in

IT cost.

Core Banking Page 3


Improved telecommunication facilities and reduction in hardware as well as

networking cost changed the mindset of the banks in India to try the CBS option.

This also equipped them with the required technology products and services, as

those offered by their new generation competitors.

1.3 MEANING AND DEFINITION

Meaning

Core means “Basic”, hence the basic services provided by the inter-

networked branches of bank is called “Core Banking”. Core Banking is normally

defined as the business conducted by a banking institution with its retail and small

business customers. Many banks treat the retail customers as their core banking

customers, and have a separate line of business to manage small businesses. Larger

businesses are managed via the Corporate Banking division of the institution. Core

banking basically is depositing and lending of money.

Nowadays, most banks use core banking applications to support their

operations where CORE stands for “Centralized Online Real-time Exchange”. This

basically means that all the bank’s branches throughout the world. These

applications now also have the capability to address the needs of corporate

customers, providing a comprehensive banking solution. A few decades ago it used

to take at least a day for a transaction to reflect in the account because each branch

had their local servers, and the data from the server in each branch was sent in a

batch to the servers in the datacenter only at the end of the day.

Core Banking Page 4


Normal core banking functions will include deposit accounts, loans,

mortgages and payments. Banks make these services available across multiple

channels like ATMs, Internet Banking, and branches.

Definition

Core banking is a general term used to describe the services provided by a

group of networked bank branches. Bank customers may access their funds and

other simple transactions from any of the member branch offices.

Core Banking is normally defined as the business conducted by a banking

institution with its retail and small business customers. Many banks treat the retail

customers as their core banking customers, and have a separate line of business to

manage small businesses. Larger businesses are managed via the Corporate

Banking division of the institution. Core banking basically is depositing and

lending of money.

Normal core banking function will include deposit accounts, loans,


channels like ATMs, Internet banking, and branches.

1.4 WHAT IS CORE BANKING SOLUTION

Core Banking Solution (CBS) is networking of branches, which enables

Customers to operate their accounts, and avail banking services from any branch of

the Bank on CBS network, regardless of where he maintains his account. The

Core Banking Page 5


customer is no more the customer of a Branch. He becomes the Bank’s Customer.

Thus CBS is a step towards enhancing customer convenience through Anywhere

and Anytime Banking.

Core Banking System or Core Banking Solution is a term that we hear very

often these days. For IT and Banking folks, this doesn’t need any explanation but

for those who want to know a bit, here’s a brief overview of what it means.

Previously a bank’s core operations such as keeping a ledger of various

transactions, maintaining customer information, interest calculation of loans and

deposits, adjustments to accounts on withdrawal and deposits of funds etc. were

done manually. With the advent of ICT (Information Communication Technology),

efforts were done to automate various banking processes using software

applications so as to make them simple, efficient, effortless and cost effective.

Thus, the platform where ICT is used to perform the core operations of a bank, like

those mentioned above, is known as Core Banking System.

In core Banking System, software applications record transactions, maintain

customer information, calculate interest on loans and deposits etc. The data,

instead of huge ledgers, are stored in backend databases in digital form. Now, the

same software can be installed in various branches of a bank and can be

interconnected through the internet or telephone lines to from a core banking

network of the bank. The advantage, a customer can operate on his account from

any branch of the bank and if the bank owns Internet Banking or ATM facilities,

then the customer can operate on his account from virtually anywhere.

Core Banking Page 6


Thus, Core Banking System has radically changed the way in which banks

function. The greatest advantage of having a Core Banking System is that new

features and functionalities can be easily added to the system that customers will

have a whole lot of services that they can use. Electronic funds transfer between

banks, online trading in the stock markets etc. are examples of this, which were

unheard of in banks pre Core Banking System era.

Core Banking and Run the Bank are synonymous for most part. Core

Banking is the meeting point of the largest banking services augment namely

Retail and Commercial Banking, cutting edge Information Technology and the

advancing Communication Technology. It is the heart of a modern financial

service organization and is all about providing the banking customers with the

right products at the right time through the right channels 24 hours a day, 7 days a

week through a multi location, multi branch network.

Core Banking Solution are banking applications on a platform enabling a

phased, strategic approach the lets people improve operations, reduce costs, and

prepare for growth. Implementing a modular, component-based enterprise solution

ensures strong integration with your existing technologies. An overall service-

oriented-architecture (SOA) helps banks reduce the risk that can result from

multiple data entries and out-of-date information, increase management approval,

and avoid the potential disruption to business caused by replacing entire systems.

Core Banking Solutions is new jargon frequently used in banking circles. The

advancement in technology, especially internet and information technology has led

to new ways of doing business in banking. These technologies have cut down time,

working simultaneously on different issues and increasing efficiency. The platform

where communication technology and information technology are merged to suit

Core Banking Page 7


core needs of banking is known as Core Banking Solutions. Here, computer

software is developed to perform core operations of banking like recording of

transactions, passbook maintenance, interest calculations on loans and deposits,

customer records, balance of payments and withdrawal. This software is installed

at different branches of bank and then interconnected by means of communication

lines like telephones, satellite, internet etc. It allows the user (customers) to operate

account from any branch if it has installed core banking solutions. This new

platform has changed the way banks are working

Gartner defines a core banking system as a back-end system that processes

daily banking transactions, and posts updates to accounts and other financial

records. Core Banking systems typically include deposit, loan and credit-

processing capabilities, with interfaces to general ledger systems and reporting

tools. Strategic spending on these systems is based on a combination of service-

oriented architecture and supporting technologies that create extensible, agile

architectures.

Core banking is a general term used to describe the services provided by a

group of networked bank branches. Bank customers may access their funds and

other simple transactions from any o the member branch offices. Core Banking is

normally defined as the business conducted by a banking institution with its retail

and small business customers. Many banks treat the retail customers as their core

banking customers, and have a separate line of business to manage small

businesses. Larger businesses are managed via the Corporate Banking division of

the institution. Core banking basically is depositing and lending of money.

Core Banking Page 8


Normal core banking functions will include deposit accounts, loans,


channels like ATMs, Internet banking, and branches.

Core Banking System or Core Banking Solution is a term that we hear very

often these days. For IT and Banking folks, this term doesn’t need any explanation

but for those who to know a bit, here’s a brief overview of what it means.

Previously a bank’s core operations such as keeping a ledger of various

transactions, maintaining customer information, interest calculation of loans and

deposits, adjustments to accounts on withdrawal and deposits of funds etc. were

done to automate various banking processes using software applications so as to

make them simple, efficient, effortless and cost effective. Thus, the platform where

ICT is used to perform the core operations of a bank, like those mentioned above,

is known as Core Banking System.

In Core Banking System, software applications record transactions, maintain

customer information, calculate interest on loans and deposits etc. The data,

instead of huge ledgers, are stored in backend databases in digital from. Now, the

same software can be installed in various branches of a bank and can

interconnected through the internet or telephone lines to form a core banking

network of the bank. The advantage, a customer can operate on his account from

any branch of the bank and if the bank owns Internet Banking or ATM facilities,

then the customer can operate on his account from virtually anywhere.

Core Banking Page 9


Thus, Core Banking System has radically changed the way in which banks

function. The greatest advantage of having a Core Bank System is that new

features and functionalities can be easily added to the system that customers will

have a whole lot of services that they can use. Electronic funds transfer between

banks, online trading in the stock markets etc. are examples of this, which were

unheard of in banks pre Core Banking System era.

Core Banking Page 10


CHAPTER 2

HOW A CORE BANKING SOLUTION WORKS

A core banking solution, often referred to as a CBS, typically has a GL

subsystem at its core with plug-in satellite modules catering to the various

divisions of the bank. The satellite modules, referred to us “modules” cater to the

business functionalities of the various lines of business of the bank. Typical CBS

modules include but are not limited to:

Non-financial modules:

Customer definition and accounts

Customer limits definition, lines of credit, a central bank reporting

structure

Messaging and advice

End-of-day processing modules, etc.

Financial modules:

Loans, deposits, money markets

Letters of credits and bills

Treasury

Liquidity management

Local payments and cross-border payments

Nostro reconciliation

Interest and charge definitions, etc.

Each silo or line of business employs one or more of these modules to run its

business. The modules are used to create contracts with customers at the branch

level for various products. For example, a short-term, fixed-rate loan contract for



the account of a large corporate customer has multiple components associated with

it, such as the contract-principle component, tax component, interest component,

product-preference component, charge component, etc.

Transactions are generated at the component level during various events of

the contract life cycle, such as contract initiation, booking, accrual, liquidation,

rollover, advice generation, contract cancellation, etc. Such dollar (or any other

currency) transactions hit the accounting and GL subsystem at the core. Thus the

core GL and accounting system ties the carious silos together.

As we have seen, the CBS and its modules are used by the lines of business

to manage customer contracts and their life cycles as well as most income

classified as non-fee income.

Core Banking and Free Income

The modules in a CBS have a charge component associated with a customer

contract that allows the bank to charge fees. This charge component can generate

transactions during various events. The charges, however, are only basic charges

that could be required at an account-contract level. In practice, there are multiple

other fees and charge components that banks capture using multiple fringe systems

in each silo.

The Limitations of Core Banking Solutions for Fee-Based Income

Fee-based income plays a significant role in the overall profitability of a

bank. Limitations on the growth of traditional spread-based income have only led



to an increase in the weight of fee-based income. Hence, banks are looking for a

way to view charge income at the enterprise level-i.e., a single-customer view of

all of a bank’s fee-based income. This means there is a need for the ability to

develop enterprise level pricing strategies, charges the customer at the relationship

level, give a bundled fee offering to the customer, etc. A CBS and its modules are

not designed to cater to a need for enterprise-wide pricing and billing.

Conclusion

A core banking solution is mainly used to manage the spread-based income

of a bank. The fact that the fee income of a bank is a key differentiator in terms of

profitability only increases its importance in the current scenario.

Having an enterprise entity and pricing strategy is important to the fee-based

income of a bank. A pricing and billing solution helps manage the fee income of a

bank by providing a single-customer view of all charges across the bank’s product

silos. A pricing and billing solution, hence, brings to the table a unique value

addition to a bank by helping it maximize its fee income.



CHAPTER 3

THE NEEDS OF CORE BANKING SOLUTION

The need for such a solution does not arise just because of one reason or the

other but it requires a combination of driving forces to income into existence.

Some of these forces being-

To meet the intense competition and changing market dynamics in an over

banked environment.

To meet the regulations and compliance requirements (example in order to

meet the Basel II norms banks must enhance there infrastructure).

To meet the demands of customers who are better informed, more

demanding and less loyal than ever.

To enhance efficiency and effectiveness

Increasing customer satisfaction and convenience

Freeing up time for branch staff to focus on sales and marketing

Simplifying process for employees

Enhancing bank’s competitiveness in the market

Improved process efficiency

Shrinking margins. Slow growth …. The challenges that confront today’s

banker are as intense as they are varied. And technology, the banker’s trusted

friend in the past few decades, has lately become an obstacle in the quest for

market leadership. Stakeholders’ expectations continue to be whetted by their

positive experience in other industries like retail and travel, of how technology ca

make a difference. Satisfying such expectations requires that banks make their vital

systems customer-centric, cross-channel capable, multilingual and process-

oriented. Not doing so in the near term could prove to be a costly gamble.



CHAPTER 4

HOW CBS HELP CUSTOMERS

All CBS branches are inter-connected with each other. Therefore, Customers

of CBS branches can avail various banking facilities from any other CBS branch

located any where in the world. These services* are:

To make enquires about the balance; debit or credit entries in the account.

To obtain cash payment out of his account by tendering a cheque.

To deposit a cheque for credit into his account.

To deposit cash into account.

To deposit cheques / cash into account of some other person who has

account in a CBS branch.

To get statement of account.

To transfer funds from his account to some other account – his own or of

third party, provided both accounts are in CBS branches.

To obtain Demand Drafts or Banker’s Cheques from any branch on CBS –

amount shall be online debited to his account.

Customers can continue to use ATMs and other Delivery Channels, which

are also interfaced with CBS platform. Similarly, facilities like Bill

Payment, I-Bob, M-Bob etc. shall also continue to be available. Bank is in

process of launching Internet-banking facility shortly.

All these aim provide convenient, efficient, and high quality banking experience to

the customers, comparable to world class standards.



CHAPTER 5

BENEFITS OF CORE BANKING

Core Banking Solutions is new jargon frequently used in banking circles of

India. The advancement in technology especially internet and information

technology has led to new way of doing business in banking. The technologies

have cut down time, working simultaneously on different issues and increased

efficiency. The platform where communication technology and information

technology are merged to suit core needs of banking is known as Core Banking

Solutions. Here computer software is developed to perform core operations of

banking like recording of transactions, passbook maintenance, interest calculations

on loans and deposits, customer records, balance of payments and withdrawal are

done. This software is installed at different branches of bank and then

interconnected by means of communication lines like telephones, satellite, internet,

etc. It allows the user (customers) to operate accounts from any branch if it has

installed core banking solutions. This new platform has changed the way banks are

working. Now many advanced features like regulatory requirements and other

specialized services like share (stock) trading are being provided core banking

solutions is very helpful to small industries. State Bank of India has electronically

networked most of its metropolitan, urban and semi-urban branches under its Core

Banking System (CBS), with over 4500 branches being incorporated so far.

According to PM Network (December 2006, Vol. 20, No. 12), State Bank of

India launched a project in 2002 to network more than 14,000 domestic and 70

foreign offices and branches. The first and the second phases of the project have



already been completed and third phase is still in progress. As of December 2006,

over 10,000 branches have been covered.

5.1 BENEFITS TO THE CUSTOMERS

A CBS branch is like a Sales & Service Delivery Center. Back office

process/activities are handled through technology at some other site, called Data

Center. Branch, therefore, has more time for serving customers. This improves the

quality and efficiency of the services rendered and the customer is directly

benefited by way of satisfying and happy banking experience.

Since a CBS branch is essentially designed to focus on customer-interface

and customer service, the special lay-out and ambience of the branch is made to

provide a convenient and delightful banking experience. The Customer Service

Representatives / Executives at the branch are specially trained to understand,

facilitate and deliver banking services efficiently and effectively. We wish our

customers happy banking.

(*To safeguard the interest of customers, Bank has placed certain restrictions

on the amount of transactions, which are handled through other branches under

CBS. The details can be obtained from the branch).



CHAPTER 6

THE APPLICATION AREAS OF CORE BANKING

Required computer software is developed to perform core operations of

banking like

Balance of payments and withdrawal are done.

Mobile banking.

Internet banking

ATM’s

Recording of transactions

Passbook maintenance

Interest calculations on loans and deposits

Customer records

This software is installed at different branches of bank and then

interconnected by means of communication lines like telephones, satellite, internet

etc. It allows the user (customers) to operate accounts from any branch if it has

installed core banking solutions. This new platform has changed the way banks are

working. Now may advanced features like regulatory requirements and other

specialised service like share (stock) trading are being provided. Sore banking

solutions are very helpful to SME industries.

6.1 APPLICATION ON CBS BY BANKS IN INDIA

Most of the nationalized banks in India for example: State Bank of India,

Punjab National Bank, Allahabad Bank, HDFC, ICICI Bank today supports core

banking. As of 2007, many Cooperative banks in India such as REPCO Bank, Jain



Urban Cooperative Bank, Kangra Central Cooperative Bank, Udaipur Urban

Cooperative Bank, Kollam District Cooperative Bank, Kerala State Cooperative

and Panchsheel Mercantile Cooperative Bank have started to use and offer

centralized Core Banking too.

Some of the Cooperative banks and RRBs are yet not having CBS, but they

are no their way to go for CBS and very soon they will also be under the roof of

the umbrella of Core Banking Solution.

CBS offers a host of advantages to the banks which in today’s world cannot

be ignored. Some of the benefits are given below:

Reduces Transaction Time CBS is a single transaction engine which

enables parallel processing. It also provides integration of multiple banking

modules. This would enable the banks to reduce transaction time to regular

transactions and also allows faster processing of loans and credits cards. Most of

these solutions offer STP, which helps in reducing the turnaround time. At the

same time the unproductive processes are identified and eliminated.

Offers a Choice of Multiple Delivery Channels These solutions enable

banks to allow multiple delivery channels like non-traditional delivery channels

that would give a choice of the channel to the customer whether through ATM,

mobile or through Internet. Also some of the solutions provide alerts. These real-

time alerts can be generated across nay of these channels. The customers can

themselves design their own alerts like minimum balance alert which alerts the

customer when his account reaches the minimum balance levels and stop payments

alert which enables him to stop payment. Alerts are also available to remind the



customer about his payment of bills. These alerts not only remind and give

information to the customers but also help them to act on them.

Enables Customer Relationships Management These solutions provide

the interface history between the bank and the customer which helps the bank to

better understand the needs and requirements of the customer based on his

previous transactions. This would enable the bank to customize the products to the

needs of the individual by studying his previous transactions. At the same time,

some of the solutions provide the banks flexibility which goes much beyond the set

parameters in order to provide customization to the specific customers. The bank

can amend business rules also for some of the privileged customers and the

solutions allow such customizations.

Standardize the Process across all Businesses Most of the CBS are built

on enterprise architecture which provides for different modules in a particular

solution following the same activity flow and uniform transaction process. So

when a bank chooses a particular solution the process gets standardized across the

organization. This is important because such uniform processes would allow easy

maintenance and up gradation.

Reduce Costs As these solutions cut time and reduce the dependence on

human intervention, the cost is reduced tremendously. At the same time revenue

would increase as the banks can now offer value added services with the existing

staff in lesser tie. These solutions also allow the banks to cross-sell products

thereby reducing the overheads.



Web – Enabled Benefits All the popular solutions are webenabled

applications. This makes the solution screens riche by allowing web applications

like charts, screens, tickers, e-mails and seamless knowledge dissemination.

Provides Real-time Audit These solutions provide audit trail and signature

capture. They also have the built- in report format feature that allows for

integration with any third party reporting tools in order to generate reports. And

also the General Ledger which is the main account in the CBS contains the

consolidated information of all the transactions. This ledger cannot only give

accounting information but also can be customized to give multi-branch and multi-

profit center accounting.

Comply with the Changing Regulatory Environment

All the solutions are built on global standards and evolving regulatory

compliances. This would help the banks to comply with the evolving standards and

regulations. These solutions give a flexibility to set and change the parameters

according to the evolving business rules quickly. Even in case of any modification,

it does not result in a change in the application’s source code. Even the bank’s

Internal staff can handle these changes and modifications easily.



CHAPTER 7

WHY THE INCEPTION IN INDIA SO LATE

There are many reasons for the late inception of CBS in INDIA, some of

them being

Indian banks were not interested in going for it.

Required technology for adopting CBS was absent.

The competition prior globalization was not that of present level.

7.1 WHAT ARE THE STANDARD SOFTWARE TOOLS

Some of the standard software tools that many banks are using these days are

o Intellect Suite from POLARIS

o Flexcube from iFlex Solutions

o Finacle from Infosys

o B@ncs from TATA Consultancy Services



CHAPTER 8

IMPACT OF CORE BANKING

The Core Banking Systems have to satisfy the requirements of all the

entities that form part of the eco-system of the Bank.

Bank Employee: Head office, regional offices, branches etc: Using

Core banking System. With appropriate authority employee as given

above can help customers do their financial transaction.

Bank management: Executives / managers at respective locations,

head office, regional offices, branches etc. can obtain the financial

position from Core Banking Systems related the respective sphere of

banking operations and thus help pinpoint potential problems so as to

avoid crises.

Bank Customers: Can operate any of their accounts from any branch

or preferred delivery channel and have access to his funds any time 24

hours a day.

Bank Auditors : Ones accounts audited, they operate the same year

on year thus enabling auditors to focus more on systems and

procedures at delivery channels like branches, call center etc.



Bank regulators: Core Banking Systems produce the required reports

for regulatory bodies like the central bank, financial statement, asset

and liability reports, NPA reports, large currency transaction reports

etc. are all produced by either the deposits, or the loan or a

combination of deposit, loan and G.L. System.

Bank Share Holders: C.B. providing the desired return to

shareholders from banking operations Trends overtime on such data

informs S.H. about how the banks is doing and help take timely action

to accelerate or improve performance.



CHAPTER 9

COMPONENTS OF CORE BANKING

A core banking system will often provide other routine maintenance

activities. Such essential activities as opening and closing accounts, calculating

interest (both due to the customer and due from the customer), processing

customers’ standing orders, providing account statements and interfacing to

outside systems for making and receiving payments are all considered to be part of

the core business of banking and therefore the legitimate functions of a core

banking system.

Interest calculations

Processing of cash deposits and withdrawals

Processing of incoming and outgoing remittances, cheques, etc.

Customer management

Customer account management

Definition of the bank’s products (product management) including such

things as minimum balances, interest rates, number of withdrawals, etc.

Interest rate definition

Customer’s standing instructions

Maintaining records of all financial transactions

A packaged retail core banking system might include functions that are

closely related to core banking activities. So a package may include such functions

as:



Processing of applications for loans received from branches, etc. (called loan

origination)

Branch management, often including facilities for maintaining teller cash

drawers, etc.

Cheque book ordering

Internet banking

Banks can have differences in the type of business that they conduct. They

may for example be in retail banking (the type of banking that is seen in the high

street), or be in wholesale banking (the bank-to-bank market often referred to as

the inter-bank market) or securities trading (the buying and selling of stock, shares

or government debt instruments). As a result their ‘core’ businesses can be

considerably different. Their core banking system will therefore reflect the type of

business of the bank and be either:

Retail banking

Commercial banking

Wholesale banking

Treasury banking

Private banking

A super breed of core banking systems has emerged which offer

functionality in addition to core banking. These systems, called universal banking

systems, can accommodate combinations of banking services such as retail,

wholesale, private banking and securities trading. An advantage of using a

universal system is that data can be transferred easily between the different



modules so a bank can identify customer trends or selling opportunities for

example if a customer has high levels of cash balances and also performs securities

trading then they may be a sales opportunity for private banking services. A

disadvantage is that it is unlikely that a single vendor is able to offer modules that

are ‘best of breed’ in each function. The alternative approach is to use a core

banking system and augment its functionality by using ‘best of breed’ packages for

the specific functionality needed such as foreign exchange trading or portfolio

management for example.

More recently, the arrival of Service Oriented Architecture (SOA) has

caused package vendors to redesign their core banking systems. SOA enables

broad packages to be de-constructed into their constituent parts with each part or

function then offered as a service. So for example a core banking activity of

opening a new account could be split into multiple services – one for establishing a

customer name and address (and checking if one already exists for that customer),

one for performing a credit check, one for opening the actual account type needed,

one for ordering a ‘new customer’ pack, one for ordering a plastic card for the

account and so on. This allows a return to the pure core banking system component

of transaction and account management.



CHAPTER 10

INGREDIENTS OF CORE BANKING

There are 5 ingredients that form part of the Core Banking system. These are

the essential building blocks for the entire bank / institution.

(1) General Ledger:

The absolute Core is the General Ledger of the bank accordingly, the

absolute core of the banking system is the General Ledger system, every single

financial activity that happens at any location within entire bank has to be reflected

in the G.L. system that generates the financial statements for the entire bank which

provides any entity to monitor the financial health of the bank.

Throughout the world, almost all banks have all their financial activity

reflected in G.L. every night and next morning the G.L. system provides the bank

with enterprise wide balance sheet and trial balance report In short for those who

have successfully implemented Core Banking Systems, the concerned entities in

the bank know the financial condition of the bank at the beginning of each business

day. If one is looking at the financial statements of the whole bank the G.L. System

must provide that. If one is in regional office, the G.L. System must provide the

financial statements for the region. If one is the branch the G.L. System must

provide the financial statements at the branch. Each morning all these entities, at

the respective workplaces, see these financial statements reflecting the condition as

of close of business yesterday.



In a Core Banking System, this is achieved by deploying a centralized G.L.

System which provides for thousands of sub legers with. Level's start with

individual branch G.L. rolled up to regional G.L. with further rollup of all regional

G.L's to bank G.L. financial transactions from various sources throughout the bank

update these subsidiary ledgers and the G.L. system then performs rollups to report

at branch, region, zone, country wise head office and any other level that is

required by the bank / financial institution.

(2) Customer Information System:

The next major ingredient of a Core Banking system is the Customer

Information System or CIS. Accordingly in the CIS, a customer is identified by

uniquely by his / her CIS number and all information related to that customer

(name, address, phones, employment, credit history, relatives, family members,

and demographic data) is stored along with this unique number. All this is stored in

a centralized CIS system allowing the customer to visit any branch to do business

with the bank.

In addition, CIS stores Customer to account relationships. A single unique

customer could have a current account a joint saving account with his wife a time

deposit, a car loan and a house loan. The CIS links all these five account to this

single unique customer I.D. whenever the customer visits any branch of the bank,

all that he does is give his name (and / or address or phone or CIS number) and the

CIS system shows the branch staff the information about this customer as well as

all the accounts linked to this customer and the latest balance in each of these

account.



(3) Deposit System:

The third major ingredient is the deposit system. The ability to process various

types of deposits is a must. These include current, savings, time deposit and

hundreds of variations in each of these. e.g. Simple current accounts, current

accounts with overdraft, cash credit accounts, variable rate overdrafts, simple

savings, multi-currency savings, time deposits, CDS, variable rate time deposit,

recurring deposits, multi-currency, time deposits, and so on. This is required to

handle the liability side of the bank / financial institution's business.

This all is achieved by having deposits system that are heavily deposit

system that are heavily parameterized i.e. by simply setting a parameter "Fixed

Rate" or "Variable Rate" the deposit account will be processed by the deposit

system using the appropriate rate from the applicable rates.

Around the world banks do not open a new deposit account for a customer

directly in the deposit system. When the customer wants to open a new deposit

account, the branch staff to go the CIS screen verifies the customer details and

opens the account. This way, the existing CIS data of the customer remains infect

and the CIS information shows that this customer has now increased his

relationship with the bank / financial institution. As a result banks who have

implemented such systems do not need to have an inter branch reconciliation

organization / system.



(4) Loan System:

The fourth major ingredient is the loan system. This system handles the asset

side of this business. In most banks / financial institutions around the world loans

are separated by those to retail customer and those to commercial customers

processing requirement of loans to corporate customers is different form retail

customers and hence there are loan systems that cater to retail customers and those

that cater to commercial or corporate customers.

The loan process in a bank involves multiple stems. The loan appraisal and

sanction step, the disbursement and monitoring step, the non-performance tracking

step the recovery step and the closure. Owing to the fact that a multitude of entities

and processes are involved in the appraisal and sanction step, most banks around

the world separate the appraisal and sanction step and implement a system called a

loan organization system. The other remaining steps of the loan process are

handling by the loan system.

With authorized access, any staff working in any branch around the country

should be able to retrieve the customer loan information on his terminal and help

the customer do a financial transaction. These financial transactions are

automatically sent to the bank / financial institution's General Ledger and they

update the appropriate credits and debits in the subsidiary ledgers in the General

Ledger.

(5) Management Information System (MIS):

Once the core deposit and loan business transaction for all customers of the

bank are captured and appropriate General Ledger accounts are updated, various



users of the Core Banking System throughout the bank need to know what is

happening within the entire financial institution. As a result, the fifth major

ingredient is the management information system. This enables everybody in the

bank to obtain the relevant information from the system in order to carry out their

business effectively.

MIS is simple terms takes information from the General Ledger, CIS

Deposit, Loan Systems and present them to the bank / financial institution. The

staff all employees including management.

Around the world, typical examples of information that bank staff (each with

access rights) retrieves include.

Branch transaction activity for today ( list of all branch transactions )

Loan activity for a single customer or a group of customer.

Branch General Ledger report printed at the branch.

N P A report for the entire bank for all transactions as of yesterday.

New Components:

Besides the 5 major ingredients, there are optional components (like a car

with options like leather seats, flashing light etc…) that can be added on to the

Core Banking Systems to help the bank staff uses them in a more efficient manner,

these include:

Delivery Channels:

All the 5 major ingredients of a Core Banking system can be operated by a

bank staff from any location in the country simple by using their terminal at their

workplace. Around the world as banks started focusing on customer relationship



management, they realized that customers interact with the entire bank for banking

transactions in many ways. Customer can go to the branch, go to an ATM, call on

the phone, and log on to the Internet to do their banking transactions. They can use

one or more of these delivery channels (Called customer touch paints) to conduct

segment and decide on further investment design specific products and services to

promote such delivery channels.

The Core Banking Systems are production factories creating products and

services and tracking them and the delivery channels are distributors and retailers

who ensure these products and services are available to the customers whenever

they are in the country. Hence, the add-on systems for Core Banking System

include;

Branch Automation system

ATM Switch and connected ATM

Call center system

Internet Banking System

Any transaction done by the customers in any of the above systems goes and

updates the Core Banking System like deposit or loan at that in turn updates the

Bank's G.L. in the Core.



10.1 What ingredients are not included in Core Banking?

Typically these systems are confined to a specific business department

within the bank. They are not Core because they do not affect all areas and entities

of the bank.

Trade finance

Treasure

Credit Card

Mutual Funds

Stocks, Bonds

External System

Payment gateways

SWIFT

Shared ATM network

World Wide credit card networks, maestro, electron etc

World wide ATM networks plus, Cirrus etc and possibly other

systems that the bank may want to deploy in specific departments



CHAPTER 11

CORE BANKING SOLUTIONS VS PRICING AND BILLING SOLUTIONS

Banks have started realizing the importance of pricing as a banking

enterprise entity. Core banking solutions fit well as technology solutions for banks'

day-to-day business.

However, the core banking solution itself cannot cater to all the fee-income

needs of a bank. This is attributable to the complex nature of each bank with regard

to its independent departments or business silos and their disparate systems. Over a

period of time, what results is a severe inability to visualize the fee income or

pricing of charges at the enterprise level.



CHAPTER 12

POWERING THE NEW AGE BANKING

The banking sector is leveraging on technology and end to end Core

Banking Solutions (CBS) not only to cut cost but also to better serve the customer

and beat the competition. Bank all around the world are embracing technology. By

leveraging effectively on technology, banks have cut costs, reduced the time of the

transactions and also added value to their customers. Starting off with the basic

automation of the bank branches, banks now are adopting technology solution like

Core Banking Solutions (CBS) which are helping them to complete better in

today’s world by enabling them to differentiate their products and services from

their competitors.

CBS has heralded an all new era in the banking world. It opened up new

channels to transact with the customers. Now the customer can choose the channel

for doing his transactions either through the ATMs, or through Internet and even

through phone. All this is resulting in a complete change in the way the banking is

done. This is the era of anywhere and any time banking, making the branch

banking and limited banking hours a thing of the past.

This is also the time of real-time banking. Transactions get instantly, instead

of waiting to be done in the next couple of days and weeks especially in the case of

cross border money transfers. All this is an integral part of the CBS. At the same

time, CBS is also helping banks to decrease the product development and testing

lead rime enabling the bank to launch new products and become innovative and

agile.



Technology Solutions: Any bank, no matter what level of technology

providers around the world. Infosys Solution Finacle, TCS solution, BANCS and

Ifles solution, FLEXCUBE are some of the popular banking solutions which

provides for universal banking and CBS. These solutions are developed after years

of research and experiences of the clients using these solutions.

CBS works on open technology platforms which work on Windows and

other architectures including Linux, which allows for easy integration with the

existing system available in the banks and effectively deal with legacy problems.

These solutions are compatible with any software and hardware systems available

with the banks. The vendors customize these solutions to cater to the specific needs

of the bank and also integrate well with the existing systems and processes in the

bank. The integration is also done quickly and in a very short period of time. Some

of the solutions offered by some vendors come in the form of universal banking

solutions which apart from providing core banking solutions also provide solutions

for wealth management, mobile banking, treasury, etc.

Most of the CBS offered by vendors provide a Dynamic Development

Interface (DDI) which allows the banks to upgrade to the changing environment

and grasp the opportunities accordingly. Almost all the solutions are Internet-based

and web-enabled based on upon source architecture. These solutions offer ‘just-in-

time’ information for different levels within the organization and also for external

people who are required and authorized to know this information. They also

provide for audit trace and logging information reassuring who has done the

transaction at what time and also giving the transaction details like amount,

location, etc. These solutions also offer historical information reassuring who has



done the transactions and provide for upgrade with every new transaction done.

These solutions also provide an access control point that would enable a unique

point of access, which can be specified by the user.

All the top core banking solutions allow Straight Through Processing (STP),

integration of multiple chapels taking into consideration multilingual,

multicurrency and multi-entity functionality. While focusing on the product, the

solutions also provide customer focus enabling effective customer relationship

management. The core banking solutions are modular and provided for scalability

and easy integration where and consolidations are the norms of the day.



CHAPTER 13

CORE BANKING AROUND THE WORLD

In countries such as India and Hong Kong that were a part of the erstwhile

British empire, It is only recently that core banking has caught on,. This is mainly

due to the restriction by the UK government on free movement of money

throughout the region. Also, the It infrastructure necessary for such services did

not exist in these countries until recently. After liberation from the UK, the

economies of these countries went through a drastic change – thus the demand for

such services increased and the need to meet such demand were met with today’s

technologies. Most of the nationalized banks in India for example: State Bank of

India, Punajab national Bank, Allahabad Bank, HDFC and ICICI Bank today

supports caore banking. As of 2007, many Co-operative banks in India such as Jain

Urban Co-operative Bank, Kangra Central cooperative Bank, Udaipur Urban

Cooperative Bank, Kollam District Cooperative Bank, Kerala State Cooperative

Bank and Panchsheel Mercantile Cooperative Bank have started to use and offer

centralized Core Banking too. The three standard software used anr Flexcube from

Solutions, Finacle from Infosys and B@ncs from TATA Consultancy Services.

In countries such as Japan, core banking is still in its early stages. Although

having autonomous reign over half a century, the consumers themselves do not see

much use for such services low demand, thus less services. It is only within the last

decade that banks started placing ATMs outside the bank premises. Many of the

bank services must be done in person at the account holders registered branch.

Japanese banks rely heavily on paperwork and physical evidence, such as the

personal chop or Inkan – thus rendering core banking impractical



CHAPTER 14

DISADVANTAGES OF CORE BANKING

In the public sector banking has first evolved from automating the

accounting processes in a stand alone mode and subsequently graduated into so

called TBM’s which in reality only integrated the these stand alone accounting

applications. Several registers, legers scrolls and other forms of MIS continue to be

generated manually in the branch. Several application packages still function in a

stand alone mode even in a TBM branch like FDR, PPF etc. Such disjointed view

of the branches resulted in a complex unmanageable IT infrastructure within these

banks such distributed data based / applications pose sever administrative

problems. Changing / modifying applications imply that these changes need to be

applied over vast geographically distributed systems, resulting in slow and error

prone updating.

With frequent interest rate changes, product launches regulatory report MIS

needs, it is needed a night mare to carryout these changes across 1500 odd

branches and retrieve the information and consolidate them to yield specific MIS

reports. Added to this is the quality of Data emanating from branches. Most data

entry operations are out sourced and validity of such massive data is questionable.

It is often said, albeit repeatability, integrity and accuracy, became real issues.

In one panoramic / integrated view and develop that package. It is beyond

view of the branches view of the market and customers. This holistic view is

implemented in centralized software called Core Banking.



Information Technology Idea:

If one sits down coolly and ponders over all these issues that them would

make any same mind to seek a strategy that will solve. If not all, most of the

problems Look around the world and see what others are doing? A core part of that

strategy is deployment of a centralized core banking system. Today after decades

of existence outside India it is now been talked about only now in our country.

This is the only way to run a bank.

From business perspective Core Banking relates to the basic business of a

bank or financial institution. That in a nut shell is taking deposits from customers

and lending to customers. While doing so, ensure that profits are generated for the

bank. From a technology perspective Core Banking is the short name for a

Centralized Banking system that a bank has to deploy in order to perform its core

banking business.

Core Banking:

The reason for calling it Core Banking System, after deployment, is the hart

or the Core of the Bank / financial institution. All entities that form part of the eco-

system of the bank / financial institution interact with. The entities are;

Bank employees head office, regional offices, branches etc…

Bank Management: executives / managers at respective locations head

office, regional offices branches etc…

Bank customers: Personal banking, corporate banking international

banking etc.



Bank Auditors, internal and external auditors who need to verify

systems and procedures.

Bank Regulators: mandatory reporting to central bank and other

financial bodies.

Bank share holders: providing the desired return to shareholders from

banking operations.

For a bank / financial institutions the Core Banking system must address the

Core Business of deposits and loans and the same time, address the work place

needs of all above entitles at their respective locations.



CHAPTER 15

CASE STUDY ON TJSB’S

TJSB’s core banking :

Thane Janata Sahakari Bank's CBS implementation on a HP platform has

helped the bank reduce its operational costs and has given it a unified view of

interactions with customers through multiple delivery channels says Akhtar Pasha

Established in 1972, the Thane Janata Sahakari Bank Ltd. (TJSB) is the

youngest Cooperative bank to get scheduled status from the RBI. In 1995, TJSB

became the leading cooperative bank in India. Today it has 40 network branches

and two Extension Counters. The bank has an installation base of 40 ATMs and

serves 7.5 lakh customers.

Subodh Nagwekar, CIO, TJSB, said, “Today we have a nice story to tell the

world on how a small cooperative bank can come close in matching the services

with large private banks. We have achieved this with meticulous planning and

vision.”

He continued, “In 2003 we realized that we needed technology to achieve

growth and meet the demands of today’s tech savvy customers. Our planning

started from this and we planned our growth map for the next five to seven years.”



Giving strategic direction to growth:

In recent years, TJSB, like all others, had been facing new competition with

each passing day. Retaining market share and profitability, while enhancing its

brand image, have been important business drivers for the bank in the medium

term. Therefore, TJSB saw a clear need to move towards a process-driven, service-

oriented architecture by scaling up its IT infrastructure and business offerings.

Additionally since the RBI had stopped issuing fresh licenses to open new

branches in 2003, TJSB took the M&A route to speed up growth and acquired

Sadguru Janjli Maharaj Sahakari Bank and Navjeevan Nagrik Sahakari Bank.

Nagwekar explained that given the bank’s growth plan, a distributed

environment was ruled out and an integrated approach seen as necessary to solve

its critical/technical issues. The Bank needed to scale up to address the challenges

of operating in a highly competitive business environment. The decentralized

branch banking approach did not quite work in the current business scenario and so

a contemporary technology-based core banking solution was the need of the hour.

TJSB’s focus was to cut the cost of operations and focus on business development

and market-share enhancement through customer-centric operations at branches.

“We thought a wider service delivery strategy was a must-have to increase the

client base and enhance market share and profitability through organic and

inorganic growth,” said Nagwekar.

Planning for DR and BC:

The bank realized that the CBS implementation would only be complete

with a comprehensive disaster recovery mechanism.



The process involved the following steps—identifying DR sites to ensure the

safety and security of the new Core Banking infrastructure.

Going online:

With the aim of supporting rapid growth through M&A and to achieve its

long-term business targets the bank decided to go online to increase internal

efficiency with an e-mail application and an intranet portal. TJSB needed to

improve its intra-branch and departmental communication by making the whole

process more speedy, efficient and inexpensive. The services to customers also had

to become much prompter thereby contributing to customer delight.

The bank was looking at an intranet portal that would help in distribution,

sharing and assimilation of efforts to a great extent. In addition, going online

would also mean improved decision-making and productivity.

Business transformation with CBS:

TJSB started its IT initiative in 2003 with a review of the existing

infrastructure, which indicated that from the long-term perspective to improve

customer service and efficiency and for the expansion of branches, resource

optimization was necessary. Therefore, there was a need to centralize the basic

operations, which would be possible by implementing a Core Banking Solution

(CBS). According to Nagwekar, the bank’s in-house committee and management

executives along with branch executives sat down for a review of all the processes

that are currently running in the bank. Once a detailed project plan was adopted,

the project kicked off in November 2004 and in early 2005 the bank issued the

purchase order for a Core Banking Solution.



For TJSB, implementation of technology was a major business decision and

it was not just about automation. It meant a transformation of the way the bank

does its business. Therefore, TJSB managed change through business process

reengineering. The business plans of the bank formed the key parameter for

evaluation of a product’s suitability. The TCO of the project was worked out and

analyzed. The challenge was to grow revenue faster than the underlying cost base

and create a scalable back office that would enable the bank to reduce operating

cost as business volumes grew.

TJSB collaborated with HP to deploy IT infrastructure and applications in

September 2006. The project team focused on mapping the bank’s business

requirements with the product’s offerings and a detailed gap document was

created. The gap document covered issues of migration strategy, business

reengineering and expeditious ‘Go-Live’ requirements and resulted in

prioritization of requirements from among the product gaps.

The implementation:

Nagwekar said that performance, scalability, uptime, reliability and

investment protection have been key aspects while deciding on the IT

infrastructure. InfrasoftTech’s had a long-standing relationship with TJSB and

therefore they chose the vendor’s OMNIEnterprise CBS. HP was chosen as a

referred hardware platform for business transformation. The CBS was deployed on

HP servers at TJSB’s data centre. InfrasoftTech implemented the Core Banking

Solution by migrating 24 branches and offices, and then moved on to the process

of migrating the Head Office’s operations on to a single enterprise-wide



centralized banking solution. The bank’s operations spread over four cities have

now been migrated to running from its data centre in Thane.

InfrasoftTech along with the Bank’s IT team completed the task of branch

migration by March 2006. The migration of the Head Office was completed by

September 2006. Since then, HP has been working with TJSB cohesively to put in

place best practices and ensure maximum uptimes for all business operations. The

notable feature of OMNIEnterprise is that it is one of the few solutions in the world

that can offer branch operation continuity for the local customers, should the

connectivity circuits with the host application fail for any reason. The engineering

parameters of OMNIEnterprise have been reviewed by Ernst & Young while its

reliability performance testing has been undertaken jointly with Intel and HP.

For the Core Banking Solution, the Bank used HP RISC base servers, the

RP3440 with a cluster of EVA4000 SAN Storage and Oracle 10g. The merger of

Navjeevan and SJMB in 2007, plus the data sharing with TJSB meant an increase

in new/concurrent users of the CBS application and the database. Since the bank

had limited storage capacity, one more HP UNIX Server, a RP3410 with an

EVA4000 was installed to support the disaster recovery site for CBS.

The Bank identified and recognized the importance of information security

and undertook risk classification of all of its information assets to take adequate

countermeasures to mitigate risk. A detailed security analysis pre- and post-CBS

implementation was done by the bank independently. To ensure the safety and

security of the new core banking infrastructure for the benefit of the bank’s

customers, employees and the management, to securely run their business with the

new technology, TJSB sought the services of a Security Consulting company,

having professionals with BS7799 Assessor, CISA, CISSP, CCNA and FCA



qualifications and having expertise in Banking/Finance domain, in the area of

design, implementation and audit of information systems security and networks.

The activity was carried out based on BS7799 and COBIT standards.

Nagwekar said, “Training all of our 300 users was a big task. We spent quite

a bit of time explaining why we are implementing CBS and the objectives of the

project. We had to explain each and every process that was undergoing change.”

Post implementation all the changed processes started commercial operation from

day one.

With a strong foundation of products, systems and processes, and the

implementation of CBS, the Bank saw immediate results. The new technology

helped TJSB become quicker, more efficient and customer-centric. Optimum

resource utilization helped the branches to focus on more crucial issues like sales

and innovative products.

This business transformation and CBS initiatives help TJSB achieve cost

advantages while also enhancing its operational metrics and customer satisfaction

levels to derive significant business benefits in the prevailing competitive banking

environment in India.

Today there is centralized monitoring of credits because of which it has

become easy to track leading and improve credit recovery. Nagwekar said, “The

rate of payment default has dropped significantly because of the centralized

monitoring of credit.”



Post the CBS implementation, the customer base has increased from 3.75

lakhs prior to CBS to approx 7.5 lakhs, thanks to CBS and also because of the

acquisition of another bank namely Sadguru Janjli Maharaj Sahakari Bank and

Navjeevan Nagrik Sahakari Bank (their branches) the acquired branches of which

were also moved to CBS within a record time of three months. The number of

branches grew from 24 to 42.

Nagwekar added that a consolidated centralized IT infrastructure any peak in

transactions. For example the number of transactions increased significantly from

35,000 to 78,000 per day.

IT as revenue model:

Since the IT infrastructure has sufficient capacity, TJSB had started hosting

applications for other small cooperative banks. This strategy will help the bank to

get some additional revenues. For example it has hosted the CBS of Kalyan Janata

Sahakari Bank Ltd., supporting 14 branches. Nagwekar said, “Since we have spare

capacity and the successful hosting of CBS of Kalyan Janata Sahakari Bank Ltd

has given us confidence to sign up two more cooperative banks.”

TJSB increasingly enhanced the Bank’s customer service levels post

implementation of the CBS. Centralization of back-office processing has reduced

response time on customer service requests and is showing optimized staff

utilization. Today, TJSB’s customers enjoy state-of-the-art technology-enabled

services. The ATMs across branches and offsite locations are now working fully

networked with centralized core banking database. TJSB is now in a position to

provide fully online banking services from multiple delivery channels like



branches, Internet, ATMs, Extension counters, on SMS-Phone-Fax thus creating a

truly valuable customer experience of anywhere and anytime banking.

Future plans:

TJSB has some aggressive growth plans. It plans to open new branches in

Karnataka and Gujarat as the new licenses to open branches has been relaxed by

RBI. The bank is expecting five more licenses from RBI. Other plans

include having a HRMS system so it all HR related and payroll systems can be

consolidated and streamlined. It would be in line with Employee Self Service

wherein any employee can log into the system to access their personal details as

well as apply for leave online.



CHAPTER 16

CONCLUSION

All nationalized banks in India have started to use and offer centralized core

banking solution but some of the cooperative banks are yet not having CBS, but

they are on their way for CBS. Thus CBS is successful in India. Customers are

very satisfied with CBS. A core part of that strategy is deployment of a centralized

core banking system. Today after decades of existence outside India it is now been

talked about only now in our country. This is would be the only way to run a bank.

From business perspectives core banking relates to the basic business of a bank or

financial institution. (That in a nut shell is taking deposits from customers and

lending to customers). While doing so, ensure that profits are generated for the

bank. From a technology perspective core banking is the short name for a

centralized banking system that a bank has to deploy in order to perform its core

banking business in today’s competitive environment



BIBLIOGRAPHY

WEBSITES

Professional banker.com

www.economy watch.com

www.core banking.com

Modern banking book


http://WWW.ECONOMY/

Documents

Core Banking 1