Ebanking FINAL

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    Management Thesis onServices provided by the bankthrough

    E-BANKING IN INDIA

    By

    Komal sahu

    PGDM(IB)

    ROLL NO 20

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    CONTENTS

    S.No. PARTICULARS PAGE NO.

    COVER PAGE 1

    TABLE OF CONTENT 2

    ACKNOWLEDGMENT 3

    CHAPTER 1 INTRODUCTION OF BANKING

    SYSTEM IN INDIA

    5-6

    CHAPTER 2 INTRODUCTION:

    E-BANKING

    6

    VARIOUS FORMS OF E-BANKING 7-13

    PLASTIC CARDS AS MEDIA FOR

    PAYMENT

    14

    ROLE OF CUSTOMER WHEN

    USING E-BANKING

    15

    SUGGESTIONS 20

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    ACKNOWLEDGEMENT

    I take this as an opportunity to thank with bottom of my heart to all those without

    whom the journey of doing my project would not have been as pleasant as it has

    been to me. Working on my project was a constant learning experience with all

    sweat and tear which was its due but not without being richly stimulating

    experience of life time.

    Finally I would like to convey my heartiest thanks to all my well wishers for their

    blessing and co-operation throughout my study. They boosted me up every day to

    work with a new and high spirit.

    KOMAL SAHU

    PGDM(IB)

    ROLL NO: 20

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    Chapter 1

    Introduction of Banking system in INDIA

    Banking system of a nation is the shadow of nations economy. A healthy and

    profitable banking system is just like the backbone of nations economy. It is

    necessary for a nation to achieve growth and remain stable in this global world and

    global economy. The Indian banking system, with one of the largest banking

    networks in the world, has witnessed a series of reforms over the past few years

    like use of E-Banking and the increased participation of private sector banks.

    History of INDIAN BANKING SYSTEM

    Banking in India originated in the last decades of the 18th century. The first banks

    were The General Bank of India, which started in 1786, and the Bank of

    Hindustan, both of which are now defunct The oldest bank in existence in India is

    the State Bank of India, a government-owned bank that traces its origins back to

    June 1806 and that is the largest commercial bank in the country. Allahabad Bank,

    established in 1865 and still functioning today, is the oldest Joint Stock bank in

    India.

    Central banking is the responsibility of the Reserve Bank of India, which in 1935

    formally took over these responsibilities from the then Imperial Bank of India,

    relegating it to commercial banking functions. After India's independence in 1947,

    the Reserve Bank was nationalized and given broader powers.

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    In 1948, the Reserve Bank of India, India's central banking authority, wasnationalized, and it became an institution owned by the Government of India.

    In 1949, the Banking Regulation Act was enacted which empowered theReserve Bank of India (RBI) "to regulate, control, and inspect the banks inIndia."

    The Banking Regulation Act also provided that no new bank or branch of anexisting bank could be opened without a license from the RBI, and no two

    banks could have common directors

    Liberalization in INDIAN BANKING SYSTEM

    In the early 1990s, the government embarked on a policy of liberalization,

    licensing a small number of private banks. Some of the private sector banks are

    ING VYSYA Bank, Axis Bank (earlier as UTI Bank), ICICI Bank and HDFC

    Bank.

    The next stage for the Indian banking has been setup with the proposed relaxation

    in the norms for Foreign Direct Investment, where all Foreign Investors in banks

    may be given voting rights which could exceed the present cap of 10%, at present

    it has gone up to 49% with some restrictions.

    Currently, banking in India is generally fairly mature in terms of supply, product

    range but reach in rural India still remains a challenge for the private sector and

    foreign banks.

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    Chapter 2

    Introduction:

    E-Banking

    Electronic banking, also known as electronic funds transfer (EFT), is simply the

    use of electronic means to transfer funds directly from one account to another,

    rather than by cheque or cash. You can use electronic funds transfer to:

    Withdraw money from your checking account from an ATM machine with apersonal identification number (PIN), at your convenience, day or night.

    Instruct your bank or credit union to automatically pay certain monthly bills from

    your account, such as your auto loan or your mortgage payment.

    Have the bank or credit union transfer funds each month from your checking

    account to your mutual fund account.

    Buy groceries, gasoline and other purchases at the point-of-sale, using a check

    card rather than cash, credit or a personal check.

    Use a smart card with a prepaid amount of money embedded in it for use instead

    of cash at a pay phone, expressway road toll, or on college campuses at the

    library's photocopy machine or bookstores.

    Use your computer and personal finance software to coordinate your total

    personal financial management process, integrating data and activities related to

    your income, spending, saving, investing, recordkeeping, bill-paying and taxes,

    along with basic financial analysis and decision making.

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    VARIOUS FORMS OF E-BANKING:

    A.INTERNET BANKING:Internet Banking lets you handle many banking transactions via your personal

    computer. For instance, you may use your computer to view your account balance,

    request transfers between accounts, and pay bills electronically.

    Internet banking system and method in which a personal computer is connected by

    a network service provider directly to a host computer system of a bank such that

    customer service requests can be processed automatically without need for

    intervention by customer service representatives. The system is capable ofdistinguishing between those customer service requests which are capable of

    automated fulfillment and those requests which require handling by a customer

    service representative. The system is integrated with the host computer system of

    the bank so that the remote banking customer can access other automated services

    of the bank. The method of the invention includes the steps of inputting a customer

    banking request from among a menu of banking requests at a remote personnel

    computer; transmitting the banking requests to a host computer over a network;

    receiving the request at the host computer; identifying the type of customer

    banking request received; automatic logging of the service request, comparing the

    received request to a stored table of request types, each of the request types having

    an attribute to indicate whether the request type is capable of being fulfilled by a

    customer service representative or by an automated system; and, depending upon

    the attribute, directing the request either to a queue for handling by a customer

    service representative or to a queue for processing by an automated system.

    B.AUTOMATED TELLER MACHINES (ATM):An automated teller machine or automatic teller machine (ATM) is an electronic

    computerized telecommunications device that allows a financial institution's

    customers to directly use a secure method of communication to access their bank

    accounts, order or make cash withdrawals and check their account balances

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    without the need for a human bank teller. Many ATMs also allow people to deposit

    cash or cheques, transfer money between their bank accounts, top up their mobile

    phones' pre-paid accounts or even buy postage stamps.

    On most modern ATMs, the customer identifies him or herself by inserting aplastic card with a magnetic stripe or a plastic smartcard with a chip, which

    contains his or her account number. The customer then verifies their identity by

    entering a pass code, often referred to as a PIN (Personal Identification Number) of

    four or more digits. Upon successful entry of the PIN, the customer may perform a

    transaction.

    The Indian market today has approximately more than 17,000 ATMs.

    C.CREDIT CARDS/ DEBIT CARDS:The Credit Card holder is empowered to spend wherever and whenever he wants

    with his Credit Card within the limits fixed by his bank. Credit Card is a post paid

    card. Debit Card, on the other hand, is a prepaid card with some stored value.

    Every time a person uses this card, the Internet Banking house gets money

    transferred to its account from the bank of the buyer. The buyers account is debited

    with the exact amount of purchases. An individual has to open an account with the

    issuing bank which gives debit card with a Personal Identification Number (PIN).

    When he makes a purchase, he enters his PIN on shops PIN pad. When the card is

    slurped through the electronic terminal, it dials the acquiring bank system - either

    Master Card or VISA that validates the PIN and finds out from the issuing bank

    whether to accept or decline the transactions. The customer can never overspend

    because the system rejects any transaction which exceeds the balance in his

    account.

    D.TELE BANKING:Undertaking a host of banking related services including financia

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