Benefits of Digital Banking and Its Importance
Banking is a major part of financial activity all around the globe. The oldest banks in India were the Bank of Hindustan and General Bank of India. However, both these banks failed and were shut down. In 1806, the bank of Calcutta was established and later came to be known as the State Bank of India. Digital banking in India is at an advanced peak and has many benefits. It is also called internet banking or online banking. The online services include making transactions, checking bank statements, submitting requests, and other banking activities. The first bank to provide online banking service was ICICI Bank in the year 1996. The trend was picked up by many banks and at present most of the banks provide internet banking facilities.
Digital Banking in India:
The technological advancement brought many changes along with it. However, it is human nature to be reluctant in accepting change. Any sort of changes is not easily adapted. So, the digitization of banks was also a major development that was not readily supported by people. There were many factors that led to the development of digital India. To minimize the human errors and bring speed to the banking processes banks started using computers with local area network (LAN). The network kept growing and people started connecting, that is when the CORE banking concept came into existence.
The Centralized Online Real-Time Exchange permitted customers to avail banking services from any branch of their bank. Then the automated teller machines (ATMs) were used. This gave birth to electronic transfers. In the 2000s the Internet banking started enhancing the banking facilities. The services like Real Time Gross Settlement (RTGS), Immediate Payment System (IMPS), and National Electronics Fund Transfer (NEFT) began making banking easier.
Although India has come a long way in the banking sector it still lags behind in some aspects of banking. This was mainly because of the high costs of managing several branches, the inability of some apps to run on every smartphone, etc. The launch of the Unified Payment Interface (UPI) in the year 2016 marked the development of banking services. Now, you have banked at your fingertips and banking in your smartphone.
Importance of Digital Banking in India:
The rate of and corruption is high in the country and therefore the digital banking seems like a safe option. It is easy to handle the transaction without having to visit the branch or carrying the money with oneself. The facility of online bill payment, online recharges, ticket booking and more have facilitated the lives of people to a great extent.
Benefits of Digital Banking in India:
Listed below are some benefits of digital banking.
Internet banking has facilitated the process of banking to a significant level. The technology has developed to a level where people can avail all the banking services at their comfort. The services can be used while traveling, at home or at work. All that is required is a working internet connection. Further, the frequent bank visits are no longer needed. People don’t have to stand in a queue and wait for their turn to arrive. The wait, the crow, and need to visit more often are reduced by the facility of internet banking.
Available at all times
Unlike bank branches, digital banking has no restricted working hours. You can make the transactions and process the requests as and when needed. The services are available 24/7.
While using banking services via bank, there is a certain limitation to services with regard to time. Furthermore, money transfers, deposit, withdrawal take quite some time. With digital banking, the case is not like this. You can use banking services anytime and the request process is comparatively faster.
At the time of urgency visiting a branch seems a difficult option and along with that if it’s a holiday nothing can be done. With the use of digital banking, money can be transferred anywhere and anytime. Holiday or not you are free to access your bank account.
Reduced banking cost
The operating cost of the banks has been reduced by digital banking. The services are now offered at lower fees and the interest rates are also higher at the deposits. Lower operating costs have also helped the banks.
Online bill payments, recharges, shopping, etc. have changed the way people perceived banking. With digital banking, it is now easy to roam cashlessly. It is not safe to carry large amounts in hand. At the time of shopping, all you have to do is just swipe the card and pay. More options are also available lately like, UPI payment; Paytm, etc. are easy ways to make payments. Bill payments are easier than ever before. No queue, no waiting, only payment with a click.
Digital Banking Trends:
Digital Banking in India is now developing at a faster pace. The latest trends in digital banking are-
The rise in the customer base
The people using banking services has significantly risen in the past decades. The Government has encouraged people to use e-wallets. These have made the payment easier and hassle-free. There is now more usage of credit/debit cards and e-wallets in all areas.
Many banks have introduced the concept of chatbots lately. These are the instant messenger and provide live service to the customer. For example, HDFC bank has ‘Eva’ as a chatbot. It has improved the accuracy and quality of service.
The internet and mobiles are two easily available techs in today’s world. Everyone uses these two. Therefore, the use of banking services is also speeding. Instead of visiting the bank branch for every small thing people prefer using Internet Banking. There are apps developed by the banks to facilitate this use.
India is a developing country and it accepts change for the sake of development and growth. Although, the changes are not accepted readily, gradually people are opening up to the idea of change. The future of digital banking is bright in India. There are constant innovations and development in the banking sector. The banking services in India are not only a technological advancement rather it is a development in the banking sector and their ways of operations and providing services.