The banking business is set to become more complex and riskier. The smooth functioning of the banking business for enabling payment and settlement systems is essential for market and financial stability, as also for economic efficiency, and for the smooth functioning of financial markets. The evolving payment systems scenario offers new opportunities like Credit Cards, Online Banking, Mobile Banking etc. and new challenges to all segments of this industry like dependency on technology, infrastructure, cost effectiveness, awareness etc. To leverage on the opportunities provided by new products, the system providers/banks need to ensure that the challenges are adequately addressed. It also has to be ensured that the products cover all segments of the population and provide an incentive to adopt these products. The regulatory process will support all orderly development of new systems and processes, within the legal mandate. The important issues in this context are how banks can provide cost effective, safe, and speedier and hassle free payment and settlement products and solutions. For the aforesaid title researcher has tried to analyze the growth of Indian economy and favorable demographics, banks have immense opportunities to further expand their business both with traditional and innovative products and through financial inclusion of technology.
Credit Cards: A credit card is a small plastic card issued to users as a system of payment. It allows its holder to buy goods and services based on the holder's promise to pay for these goods and services. The issuer of the card creates a revolving account and grants a line of credit to the consumer (or the user) from which the user can borrow money for payment to a merchant or as a cash advance to the user. The main benefit of each customer is convenience. Compared to debit cards and cheques; a credit card allows small short-term loans to be quickly made to a customer who need not calculate a balance remaining before every transaction, provided the total charges do not exceed the maximum credit line for the card. Credit cards also provide more fraud protection than debit cards. Many credits cards offer rewards and benefits packages, such as offering enhanced product warranties at no cost, free loss/damage coverage on new purchases, and points which may be redeemed for cash, products, or airline tickets
Online Banking: Online banking (or Internet banking) allows customers to conduct financial transactions on a secure website operated by their retail or virtual bank, a credit union, or building society. E-banking solutions have many features and capabilities in common, but traditionally also have some that are application specific.
Mobile Banking: Mobile banking (also known as M-Banking, banking, SMS Banking) is a term used for performing balance checks, account transactions, payments, credit applications and other banking transactions through a mobile device such as a mobile phone or Personal Digital Assistant (PDA). The earliest mobile banking services were offered over SMS. With the introduction of the first primitive smartphones with WAP support enabling the use of the mobile web in 1999, the first European banks started to offer mobile banking on this platform to their customers.
ATM / DEBIT CARD: An ATM card (also known as a bank card, client card, key card, or cash card) is a card issued by a bank, credit union, or building a society that can be used at an ATM for deposits, withdrawals, account information, and other types of transactions, often through interbank networks.
Money Transfer: Money the transfer generally refers to one of the following cashless modes of payment or
payment systems:
1)Wire
transfer, an international expedited bank-to-bank funds transfer
2)Electronic funds transfer, an
umbrella term mostly used for bank card-based payments
3) there are so many applications from that, we can transfer money from one account to another account such as UPI, Paytm, phone pay, google pay, etc.
MAJOR CHALLENGES:
Dependency on technology: With the increased use of IT, there are attendant risks posed to the banks as well as their customers in terms of monetary loss, data theft, breach of privacy, and banks need to be extremely cognizant of such risks. Another significant aspect of the banking business is regulatory and supervisory compliance. With the growth and globalization of markets in general and in the aftermath of recent crises in particular, the number of such compliance requirements is increasing. Banks have adopted technology, but the benefit of technology has not fully percolated in terms of cost, speed, and convenience. Empowering customers with technology-driven benefits is a big challenge.
Cost-Effectiveness: Technology adoption has changed the face of banking in India. Widespread technology deployment in the banking business has also brought to the fore some new issues and challenges. These can be broadly divided into two categories - costs and risks. Costs, in terms of increasing expenditure on IT deployment and risks that are resulting from reliance on IT systems without necessary safeguards. Cost aspects can be addressed by synergizing IT deployment objectives with the broader, strategic business objectives to ensure adequate operational and management controls over purchase as well as maintenance of appropriate technology solutions.
Technology adoption: The
problem of resistance from the workforce has largely been neutralized over the
years, but the primary issue involved with the adoption and rapid integration
of technological processes within banks still related to human resources- the
availability of technically skilled resources is scarce. Technology is not
among the core competencies of financial institutions, which necessitates
outsourcing. Banks in India are different from banks in many other countries,
in ways that they have a very large branch network and varied needs specific to
regions and customers. Most off the shelf solutions are not exactly in conformity
to the needs of the banks, which makes room for large customizations.