Innovative Services by Banks

7/30/2019 Innovative Services by Banks

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A bank is a financial intermediate that acceptsdeposits and channels those deposits into lending

activities ,either directly or through capital markets.

The oldest bank still in existence is Monte dei Paschidi Siena, headquartered in Siena, Italy, which has

been operating continuously since 1472

Introduction


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Banking in the modern sense of the word can be

traced to medieval and early Renaissance Italy, to the

rich cities in the north like Florence, Venice andGenoa

Banks can be traced back to ancient times evenbefore money when temples were used to storecommodities

Banks played a key role in moving from gold andsilver based coinage to paper money, redeemableagainst the bank's holdings.

History Of Banking


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Banking in India originated in the last decades of the 18th

century. The first banks were The General Bank of India whichstarted in 1786, and the Bank of Hindustan, both of which are

now defunct. The oldest bank in existence in India is the StateBank of India, which originated in the Bank of Calcutta in June1806, which almost immediately became the Bank Of Bengal .

Foreign banks too started to arrive, particularly in Calcutta , inthe 1860s. The Comptoire d'Escompte de Paris opened a branchin Calcutta in 1860, and another in Bombay in1862; branches in Madras and Puducherrythen a French colony, followed. HSBCestablished itself in Bengal in 1869.Calcuttawas the most active trading port in India,mainly due to the trade of the British Empire, and so became abanking center.

Banking In India
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The major steps to regulate banking included:

In 1948, the Reserve Bank of India, India's central bankingauthority, was nationalized, and it became an institutionowned by the Government of India.

In 1949, the Banking Regulation Act was enacted whichempowered the Reserve Bank of India (RBI) "to regulate,control, and inspect the banks in India."

The Banking Regulation Act also provided that no newbank or branch of an existing bank could be openedwithout a license from the RBI, and no two banks couldhave common directors.

Post Independence
http://en.wikipedia.org/wiki/Reserve_Bank_of_Indiahttp://en.wikipedia.org/wiki/Reserve_Bank_of_India


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The RBI was nationalized on January 1, 1949 in terms of

the Reserve Bank of India (Transfer to Public Ownership)Act, 1948 (RBI, 2005b).

By the 1960s, the Indian banking industry had become animportant tool to facilitate the development of the IndianEconomy.

A second dose of nationalization of 6 more commercialbanks followed in 1980

The stated reason for the nationalization was to give thegovernment more control of credit delivery. With thesecond dose of nationalization, the GOI controlled around91% of the banking business of India

After this, until the 1990s, the nationalised banks grew ata pace of around 4%, closer to the average growth rate of

the Indian economy.

Nationalisation


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In the early 1990s, the then Narsimha Rao government

embarked on a policy of liberization, licensing a smallnumber of private banks.

These came to be known as New Generation tech-savvybanks, and included Global Trust Bank (the first of suchnew generation banks to be set up), which lateramalgamated with Oriental Bank of Commerce, AxisBank(earlier as UTI Bank), ICICI Bank And HDFC Bank.

Modern banks offer many services to attract a loyalclientele. Banks have grown from simply being a place tokeep your money to corporate giants with offerings acrossthe board

Liberlization


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For those persons who are on the go, banks today offeronline or Internet banking. Many services are availableover the computer, making it easy to check balances, makeonline bill payments and balance your cheque book.Someone can apply for a loan or even purchase savingsbonds from your bank through your home computer.

For those persons who are on the go, banks today offeronline or Internet banking. Many services are available

over the computer, making it easy to check balances, makeonline bill payments and balance your cheque book.Someone can apply for a loan or even purchase savingsbonds from your bank through your home computer.


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What are the key factors that appeal to bank customers and

entice them to do more business? As in most service industries, overall responsiveness and

behavioural attributes account for a 10-percent margin incustomer satisfaction. When it comes to speed of service and the attitude of the people

who deliver that service, banks should improve their personaltouch.

Furthermore, advanced technologies provide bank managers

and staff valuable help because convoluted legacy systemshinder the prompt delivery of banking services and theintegration of customer information.

Technology also plays a role with other drivers of customersatisfaction, such as quality of service and product innovation.

Customer Satisfaction

Lags


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On the consumer-banking side, deposits, savings,personal loans, bankcards, mortgages, auto finance,

and payments have provided a traditional productfoundation for many decades. For wholesalebanking, the foundation has been commerciallending, cash management, trade finance, treasury

products, and securities processing.Most banks still have to figure out effective ways to

combine these diverse product dimensions into morecomprehensive relationship offerings.

Untapped Business

Potential


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Banks have many opportunities to realize untapped valuefor

instance, by offering the following characteristics:

o Innovation : Broadband delivery and multimedia technologiesprovide a fertile ground to structure proactive and dynamicproducts that redefine the way banks interact with customers.

o Personalization : Adaptive product configurations in real timeand enterprise architectures optimize individual financialprofiles to take advantage of a comprehensive set of assets and

liabilities.o Integration : As with companies in other industries, insurance

and securities firms embed banking offerings by linking theirbusinesses tightly to a federated network of service providers


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To justify the expense of maintaining branches,

banks are seeking ways to offer new services of valueat their branches and looking for better ways to

cross-sell and up-sell there.

During the past two centuries, banks have kept astronghold on the risk-management function.Technology shifts, new markets, and younger

customer generations are causing other industries tobecome more involved in financial services.

Meeting Emerging

Customers Needs

I d t i it t b th I d t i l


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In order to increase its customer base, the IndustrialDevelopment Bank of India offers a number of customized andinnovative banking services. The services are meant to offercent percent satisfaction to the customers. Some of the wellknown services offered by the bank are:

Wholesale financial services, Retail banking services, Corporateadvisory services. The continuing evolution of the banking and financial market

has created opportunities both for providers and for users offinancial products and this evolution have proven beneficial tothe economy.

Modern day banks have extended the concept of MobileBanking. Some banks in the European and Americancontinents have launched floating branches on boats thatprovide full branch bank services, to the convenience anddelight of customers living in longhouses along the river banks.

The Korean Technology Banking Corporation (KTB) is settingup a Technology Financing Information Center to serve thevarious needs of its clients, most of which are setting up joint-venture overseas. The centers will contain a huge database ofinformation analyzed from various data from internal andexternal sources.


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An innovative service specifically tailored to meetthe requirements of Corporates/Business

houses/Partnership firms Speedy collection of outstation cheques and other

instruments

Pooling of funds at designated centres

More importantly, providing funds to the Corporatesas per their need

Customised MIS reports

What is CCMS?


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Funds available as per need on day zero, day one,

day two, day three etc.

Corporates can plan their cash flows Bank interest saved as instruments are collected

faster

Affordable and competitive rates

MIS reports customised to meet individualCorporate's requirement

Single point enquiry for all queries

Operational in 148 Cities/Centres

Benefits to the Corporates


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A conventional bank may treat its customers as coldly as the

cash they deposit or borrow. Many banks have convenientlyused control and security as reasons for their remarkably slow

and impersonal services. Others banks, shedding their conservative "finance and control"

images, have likewise adopted innovative service strategies andpractices.

Banco Frances has established an information center or"encyclopaedia" in the waiting lounge. Here customers can

browse through various bits and pieces of important serviceinformation like the average time to finish a transaction and thecompany's products and services. Information about the busiestday or days in the branch are displayed so that customers maywant to avoid these periods.

INNOVATIVE BANKING CUSTOMERSERVICE


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Some banks and financial institutions have done such a

remarkable job in improving and reinventing customer servicethat they themselves have become the benchmarks of other

companies outside the banking sector. For instance, American Express, the credit card company, is the

recognized benchmark to emulate when it comes to improvinga company's billing process. Amex's billing is reportedly thefastest and most accurate in the world in any industry. Xerox,the benchmark for many quality practices, used the Amexmodel in enhancing its billing systems.

Innovative banking in customer service is indeed a welcomeand long-awaited development. We hope that other banks andfinancial institutions will follow suit soon. Satisfied customersare the best guarantee of stability and growth.

I t t


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Mr. A had visited the Borivali branch of ICICI Bank in the

month of April 2009 to foreclose his Housing Loan at ICICIBank and to switch to any other bank which offers a reduced

rate of interest. Mr. Sparsh Gupta, a young employee of theBank, suggested him to switch to an adjustable rate of interestto avail of reduced rate of interest and to eliminate the hasslesof loan transfer.

He is happy at having done this as his rate of interest has gotreduced substantially.

Mr. A who got his loan transferred to another Bank had toface a lot of bureaucratic paperwork , as the Manager at thatBank was himself unsure of the documentation . He had toalso pay for valuation and other formalities in terms of timeand money.

Interv ew rom customers oICICI


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Mr. B has been with bank for 8 years now and theservice bank provide, especially web service, is

amazing. Mr. B is a globe trotter and have alwaysfound the Bank to be more customer friendly. Also,the responses to the queries on e-mails are veryquick. Hats off to staff for being a part of such an

innovative Bank. Everything comes without doubt apassionate Bank. Keep up the good work!


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THANK YOU

Innovative Services by Banks

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