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Innovations banking 0

INNOVATIONS IN BANKING

The term “INNOVATION” means to make something new. Banks now no longer restricted to traditional banking activities but explored newer avenues to increase business and capture new markets.

Following are the types of innovative banking:

1) Internet Banking

Internet banking is also known as online banking, Virtual Banking, and web banking. Internet Banking allows its users to execute transactions with the help of the internet. Internet Banking provides all the functions which are provided traditionally at a local bank branch such as deposit of money, bill payment.

  • ICICI is the first bank to introduce internet banking.

2) Mobile Banking

Mobile Banking is a system that allows customers to perform a number of financial transactions through a mobile device.  It may include:

  • Bill Payment Alert

  • Utility Bill Payment

  • ATM location

  • Interbank Mobile Payment Service

3) Wholesale and Retail Banking

Retail Banking refers to banking in which banking institutions execute transactions directly with consumers rather than corporate or other banks.

It includes the following services:

  • Saving and checking accounts

  • Personal loans

  • Debit cards

  • Credit cards

Wholesale Banking refers to conducting a banking business with industrial and business entities. This includes corporate, trading houses, multinational companies, and domestic companies.

It includes the following:

  • Fund based services

  • Non-fund based services

  • Value-added services

  • Internet banking services

4) Universal and Narrow Banking

Universal Banking is a combination of commercial banking, investment banking, development banking, insurance, and many other financial activities. It is a place where all products are available. Narrow Banking involves mobilizing the larger part of the deposits in risk-free assets such as government securities. In India, narrow banking is implemented partially. It basically helps the banks to reduce NPAs (nonperforming assets)

5) Offshore and Multinational Banking

Offshore Banking- Offshore banking is a term used to describe banking activity in currencies other than the currency of the country in which the bank accounts are held. Countries conducting such business are called offshore financial center.

Multinational Banking - Multinational banks are those banks that physically operated in more than one country. It is also known as an international bank.

  • Indian Bank is the first bank to open its branch outside India in 1946.

  • Bank of Baroda has maximum number of overseas branches.

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Sample Questions

Q1) Which is the first bank to start Internet Banking in India?

(A) ICICI

(B) HDFC

(C) SBI

(D) Bank of Baroda

Q2) In the acronym IMPS, I stand for______

(A) India

(B) Interbank

(C) Information

(D) None of these

Q3) The banking in which banking institutions execute transactions directly with consumers rather than corporate or other banks is known as_____

(A) Wholesale Banking

(B) Para Banking

(C) Retail Banking

(D) None of these

Q4) Banking in which banking business conducts with industrial and business entities is known as_______

(A) Wholesale Banking

(B) Retail Banking

(C) Offshore Banking

(D) All of above

Q5) Wholesale Banking includes services like_______

(A) Fund Based Services

(B) Fee-Based Services

(C) Value-Based Services

(D) All of above

Q6) Which of the following service is not provided by the Retail banks?

(A) Fund Based Services

(B) Providing personal loans

(C) Providing Debit Cards

(D) Providing Credit Cards

Q7) Which of the following is the first bank in India to open its branch outside India?

(A) Bank of Baroda

(B) HDFC

(C) Indian Bank

(D) Punjab National Bank

Q8) Which bank has maximum number of branches outside India?

(A) Bank of Baroda

(B) Bank of India

(C) Andhra Bank

(D) None of above

Q9) What is the full form of ICICI?

(A) Industrial Credit and Investment Corporation in India

(B) Investment Credit and Industrial Corporation in India

(C) Information and Investment Corporation of India

(D) Industrial Credit and Investment Corporation of India

Q10) Who is the CEO (Chief Executive Officer) of ICICI Bank?

(A) Chanda Kochhar

(B) Kieren Dsouza

(C) K V Kamath

(D) None of above

Q11) Some banks invest their money in government securities instead of investing in market to avoid risk such banking service is known as______

(A) Merchant Banking

(B) Narrow Banking

(C) Para Banking

(D) None of the above

Q12) When bank provides banking services expect the general banking facility is known as________

(A) Para banking

(B) Narrow banking

(C) Merchant banking

(C) All of the above

Answers:

1) (A) ICICI is the first bank to start internet banking in India

2) (B) IMPS- Interbank Mobile Payment Service

3) (C) Retail Banking is the banking in which banking institutions execute transaction directly with consumers rather than corporate or other banks

4) (A) Wholesale Banking is the banking in which banking business conducts with industrial and business entities

5) (D) All of the above options

6) (A) Fund Based Services are not included in the services provided by the Retail Banking

7) (C) Indian Bank is the first bank to open its branch outside India

8) (A) Bank of Baroda is the bank which has maximum branches outside India

9) (A) ICICI- Industrial Credit and Investment Corporation in India

10) (A) CEO of ICICI bank- Chanda Kochhar

11) (B) some banks invest their money in government securities instead of investing in the market to avoid risk such banking service is known as Narrow Banking

12) (D) when the bank provides banking services expect the general banking facility is known as Para Banking

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