Do you remember the last time you visited a physical bank branch to change your registered mobile number or personal details?
Do you remember the last time you visited a bank for any financial operation?
If your answer to these questions is “no”, you have e-banking to thank!
Table of Contents
What is E-Banking?
If you’ve ever transferred money online, changed your ATM Pin on an app, or gotten an email copy of your account statement, you’ve enjoyed the benefits of e-banking.
E-banking/Electronic banking allows us to perform financial transactions and other operations online seamlessly. The Internet has helped make banking significantly more accessible and efficient. Let’s discuss how.
What are the services provided by E-banking?
Going to ATMs, swiping debit/credit cards, and transferring money online, all of this comprises E-banking. Here is the list of various types of e-banking services provided today:
Regardless of whether you use your bank’s webpage or mobile application to make a transfer, you are using internet banking.
Internet banking enables users to make seamless transfers, access personal details, make easy bill payments and so much more just with a stable internet connection!
If you do all these things on your bank application on your phone, it is called mobile banking.
Do you have to withdraw or deposit cash urgently? Automatic Teller Machines (ATM) allow you to do so seamlessly in just seconds. ATMs were the first form of digital banking that was introduced.
Enter your card/account details, enter the amount to be withdrawn, enter your ATM PIN and there you go!
You’re at a mall, buying clothes, and it’s time to pay. You swipe your card and ping! The transaction is successful!
Before debit cards, this transaction would have involved exchanging cash, calculating balance, and counting coins – tedious, and long.
The introduction of debit cards has allowed for transactions to be completed in mere seconds.
Credit Cards allow users to borrow funds up to a pre-approved amount and in addition to this, you can avail of a range of offers.
Electronic Data Interchange (EDI)
Electronic Data Interchange is a digital mode of fund transfer across businesses.
EDI is a standard electronic format that tends to replace company paperwork like purchase orders and invoices hence reducing manual processing errors.
In this way, it helps reduce transaction costs across a supply chain.
Electronic Fund Transfer (EFT)
Electronic Fund Transfer is a digital way of transferring funds.
While you transact online, there are a number of modes of payment you can opt for. National Electronics Fund Transfer (NEFT), Immediate Payment Service (IMPS) and Real-Time Gross Settlement (RTGS).
Electronic Clearing System (ECS)
ECS is a provision that allows a customer’s credit card bill to simultaneously be deducted from that customer’s savings account. This allows the customer to avoid late payments.
Read: E-banking Guidelines
Benefits of E-banking:
The benefits of Electronic banking are felt across customers, banks, and businesses.
Let’s have a look:
|No hassle of bank visits saves customers a lot of time and energy.||Lower transaction charges in comparison to bank transfers.||Electronic exchanges are the least expensive form of exchanges|
|Customers also face no geological obstacles. E-banking makes any kind of financial services and transactions very convenient||Manual processing errors will reduce since the financial operations of businesses are digital and automated.||E-banking allows lesser manual/desk work and even reduces the risk of human error since all financial operations are digital.|
|Customers find all financial services at their fingertips and can transact from anywhere and at any time 24x7x365||The efficiency of a business increases since most banking operations are digitals, hence saving a lot of time.||Since e-banking provides more convenience to customers, banks experience higher reliability from clients.|
Is E-banking the same as Internet banking?
➡️ E-banking is a blanket term that covers everything from internet banking to NEFT/RTGS transfers.
➡️ Any kind of digital mode of fund transfer comes directly under Electronic Banking (E-banking). For example, internet banking, mobile banking, and other modes of online fund transfers like NEFT, RTGS, and IMPS all fall under Electronic Banking.
There was a time when even for normal fund transfers businessmen/customers had to visit banks 157848 times. Other financial services like investments and loans along with fetching simple personal account details were extremely tedious since they were not readily available.
E-banking and its evolution have modified lives. Banking at the fingertips is a dream come true and today, we face no more hassles of visiting banks for the tiniest of issues or services.
Similarly, banking has faced prominent evolution. From traditional banking to neo-banking the evolution of the fintech space has had a significant impact on businesses today.
Read more: What is Fintech?
Types of E-Banking
The integration of the internet and computers into finance and banking has created several branches of e-banking.
1. Online Banking: Online banking is a type of e–banking that allows customers to access their banking accounts, view account activity, make payments and transfer money via an online platform.
2. Mobile Banking: Mobile banking is a type of e–banking that allows customers to access their banking accounts, view account activity, make payments, and transfer money via a smartphone or other mobile device.
3. ATM Banking: ATM banking is a type of e–banking that allows customers to access their banking accounts, view account activity, make payments, and transfer money via an automated teller machine (ATM).
4. Direct Deposit: Direct deposit is a type of e–banking that allows customers to have their paycheck, Social Security, or other income deposited directly into their bank account.
5. Electronic Funds Transfer (EFT): Electronic funds transfer (EFT) is a type of e–banking that allows customers to make payments and transfer money electronically.
6. Electronic Bill Payment: Electronic bill payment is a type of e–banking that allows customers to pay their bills electronically.
7. Online Investing: Online investing is a type of e–banking that allows customers to purchase investments such as stocks, bonds, and mutual funds online.
Frequently Asked Questions
What is e-banking?
E-banking is the blanket term that covers everything from internet banking to NEFT/RTGS transfers.
Any kind of digital mode of fund transfer comes directly under Electronic Banking(E-banking).
What are the services provided by e-banking?
Some of the services provided by e-banking are mobile banking, NEFT, RTGS, IMPS, debit/credit cards, Electronic Data Interchange(EDI), and Electronic Clearing system(ECS).
Is e-banking secure?
Yes, e-banking is very secure. Banks use encryption and other security measures to protect customer data, and they are constantly improving their security measures to stay ahead of fraudsters.
What types of transactions can I do with e-banking?
You can use e-banking to transfer funds, pay bills, view account balances, set up direct deposits, and more.
Are there any fees associated with e-banking?
Some banks may charge fees for certain types of transactions, such as transfers to other accounts. However, many banks offer free e-banking services.