Internet Banking - Types, How to Access, Features, ATM, Precautions.

What is Internet Banking - 

Internet Banking or E-banking means any user with a personal computer and a browser can get connected to user bank website to perform any of the virtual banking functions. 

In internet banking system the bank has centralized database that is web-enabled. All the services that the bank has permitted on the internet are displayed in menu. 

Any service can be selected and further interaction is dictated by the nature of service. The network which connects the various locations and gives connectivity to the central office within the organization is called intrant.

These networks are limited to organizations for which they are set up. SWIFT is a live example of intranet application.

Internet Banking in India -

The Reserve Bank of India constituted a working group on Internet Banking. The group devided the internet banking products in india into 3 types based on the levels of access granted. They are: 

1. Information Only System - : General purpose information like interest rates, branch location, bank product and their feature, loan and deposite calculation are provided in the bank website.

There exist facilities for downloading various types of application forms. The communication is normally done through e-mail. There is no interaction between the customer and bank's application system. 

No identification of the customer is done. In this system, there is no possibility of any unauthorized person getting into production systems of the bank through internet.

2. Electronic Information Transfer System - : The system provides customer's specific information in the form of account balances, transaction details and statement of accounts.

The information is still largely of the 'read only' format, Identification and authentication of the customer is through password. The information is fetched from the bank's application system either in batch mode or off-line. 

3. Fully Electronic Transactional System - : This system allow bi-directional capabilities. Transactions can be submitted by the customer for online update. This system requires high degree of security and control.

In this environment, web server and application systems are linked over sercure infrastructure. 

It comprises technology covering computerization, networking and security, inter-bank payment gateway and legal infrastructure.

To access InterNet Banking - 

• To access Internet banking facility firstly open bank website.

• Login to the InterNet banking facility by using the customer ID and password.

Your customer ID id mentioned on the welcome letter and cheque book that is mailed to you post your account opening. 

You can also SMS CUSTID <account-number> to 5676782 from your registered mobile number to get your Customer ID.

Example:

CUSTID 913XXXXXXXXXXXX

Feature of Internet Banking - 

Internet Banking has many feature both for banks and for customer and Banks.

For Banks :-

• Great reach to customers.

• Quicker time to market for market.

• Ability to introduce new products and services quickly and successfully.

• Ability to understand its customers needs, and

• Greater customer loyalty for bank.

For Customers :-

• View account balance and download statements.

• Transfer funds between accounts in same bank or other banks.

• Make payment/receive payments through RTGS. 

• Create fixed deposites.

• Request for Demand Draft.

• Order for cheque book.

• Refill a prepaid mobile card or pay post paid mobile bills.

• Make investment, purchase or sale of securities.

Automated Teller Machine (ATM) - 

ATM is designed to perform the most important function of bank. It is operated by plastic card with its special features. The plastic card is replacing cheque, personal attendence of the customer, banking hour's restrictions and paper based verification.

There are debit debit cards. ATMs used as spring board for Electronic Fund Transfer. ATM itself can provide information about customers account and also receive instructions from -  ATM cardholder.

Smart Card - : Banks are adding chips to their current magnetic stripe cards to  enhance security and offer new service, called Smart Cards allow thousands of times of information storable multiple functions.

They hold a large amount of personal information, from medical and health history to personal banking and personal preferences.

You can avail the following services through E-Banking - 

• Bill payment service - : You can facilitate payment of electricity and telephone bills, mobile phone, credit card and insurance premium bills as each bank has tie-ups with various utility companies, service providers and insurance companies, across the country. To pay your bills, all you need to do is complete a simple one-time registration for each biller. You can also set up standing instructions online to pay your recurring bills, automatically. Generally, the bank does not charge customers for online bill payment.

• Fund Transfer - : You can transfer any amount from one account to another of the same or any another bank. Customer can send money anywhere in India. Once you login to your account, you need to mention the payees' account number, his bank and the branch. The transfer will take place in a day or so, whereas in a traditional method, it takes about three working days. ICICI Bank says that online bill payment service and fund transfer facility have been their popular online services. 

• Credit Card Customer - : With Internet banking, customers can not only pay their credit card bills online but also get a loan on their cards. If you lose your credit card, you can report lost card online.

• Railway Pass - : This is something that would interest all the citizens. Indian Railways has tied up with ICICI Bank and you can now make your railway pass for local trains online. The pass will be delivered to your doorstep. But the facility is limited to Mumbai, Thane, Nashik, Surat and Pune. 

• Investing through Internet Banking - : You can now open an FD online through funds transfer. Now investors with interlinked demat account and bank account can easily trade in the stock market and the amount will be automatically debited from their respective bank accounts and the shares will be credited in their demat account. Moreover, some banks even give you the facility to purchase mutual funds directly from th online banking system. Now a days, most leading banks offer both online banking and demat account. However if you have your demat account with independent share brokers, then you need to sign a special form, which will link your two accounts. 

• Recharging your prepaid phone - : Now just top-up your prepaid mobile cards by logging in to Internet banking. By just selecting your operator's name, entering your mobile number and the amount for recharge, your phone is again back in action within few minutes.

• Shopping - : With a range of all kind of products, you can shop online and the payment is also made conveniently through your account. You can also buy railway and air tickets through internet banking.

Security Precautions -

Customers should never share personal information like PIN number, passwords etc with anyone, including employees of the bank. 

It is important that documents that contain confidental information are safeguarded. PIN or password mailers should not be stored, the PIN and/or passwords should be changed immediately and memorized before destroying the mailers.

Customer are advised not to provide sensitive account-related information over unsecured e-mails or over the phone.

Take simple precaution like changing the ATM PIN and online login and transaction passwords on a regular basis. Also ensure that the logged in session is properly signed out. 

Advantages of Online Banking -

• An online account is simple to open and easy to operate. 

• It's convenient, because you can easily pay your bills and trasfer your funds between accounts from nearly anywhere in the world.

• You do not have to stand in a queue to pay off your bills. Also you do not have to keep receipts of all of your bills, as you can now easily view your transactions.

• It is available all the time. You can perform your tasks from anywhere and at any time, even at night or on holidays when the bank is closed. The only thing you need to have is an active internet connection. 

• It is fast and efficient. Funds get transferred from one account to the other very fast. You can also manage several accouts easily through Internet banking. 

• You can keep an eye on your transactions and account balance all the time.

• You can get to know about any fraudulent activity or threat to your account before it can pose any severe damage. 

• It's a great medium for the banks to endorse their products and services.

• More online services include loans and investment options. 

Disadvantages of Online Banking -

• Understanding the usage of internet banking might be difficult at the first. That said, there are some sites which offer a demo on how to access online accounts. So, a person who is new to technology might face some difficulty. 

• You cannot have access to online banking if you don't have internet connection; thus, without the availability of internet access, it may not be useful .

• Security of transactions is a big issue. Your account information might get hacked by unauthorized people over the internet.

• Password security is a must. After receiving your password, change it and memorize it. Otherwise, your account may be misused.

• Your banking information may be spread out on  several devices, making it more at risk. 

• If the bank's server is down, then you cannot access  your accounts.

• If the bank's server is down, due to the loss of net connectivity or a slow connection, then it might be hard to know if your transaction went through. 

• You might get overly marketed too and become annoyed by notifications. That said, these can easily be turned off. 

• You might become annoyed by constant emails and updates.