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Using Cash Machines (ATMs or Automated Teller Machine)

ATMs can be used to for a range of banking services...

Withdrawing cash

Depositing money

Checking the balance of accounts

Transferring money between accounts

Paying bills

Get credit for your phone

ATM Process

A customer identifies him/herself and their bank account by using a bank card. The card is inserted into the ATM where it is read by a magnetic strip reader or a smart card reader. The customer also types a secret PIN into the ATM's numeric keypad to confirm that they are the real owner of the card. The pin is then compares it to what the chip has. If they match then the ATM checks the balance on the account to see if there are suffieicent funds then allows them to do whatever they may want to do; if withdrawing cash they may only be allowed to take out a certain amount of money a day. If depositing money then the user inserts the cash into the ATM and after either process is complete the customer will be given a receipt and their card back.

Applications of ICT in Banking

Objective

To know how ICT has effected our banking lives

Cheque Clearing

Process

The numbers printed onto the cheque in a special magnetic ink, which can be read at very high speed by the magnetic ink character reader.As the cheque is being presented for payment the amount on the cheque is printed onto the check and then read at the end of the day using the batch process.

Check Clearing is the process that uses input methods that use magnetic ink characters printed on the cheque.

Advantages

As you see here

  • Dont need to spend time travelling to the bank to perform bank transactions
  • Access to your bank information any hour of the day therefore you may do any of your transactions anytime!!
  • Can pay bills without the need for cheques or cash

Disadvantages

  • The worry of hackers accessing your account and stealing your money
  • You cannot withdraw cash therefore you would need to travel to the bank or find a ATM

Disadvantages

  • Expensive- High speed magnetic ink readers are very expensive

Advantages

  • Documents are read with 100% accuracy
  • Extremely difficult to forge
  • Can be read easily even if the cheque is folded, crumpled, etc

Internet Banking (online banking)

It is now very common for bank customers to access their bank account from home using on-line banking services.

How it is carried out

Customers use a computer and connect to the bank’s secure (encrypted) website where they login (usually with a username and a password)

Advantages:Banks can reduce the number of branches they open therefore reducing costs.

The bank staff can be less qualified so this reduces the wage costs.

Advantages

  • It is possible for use 24 hours a day.
  • Fewer queues, since the transactions performed by the ATM are much faster.
  • If card is stolen the theif cannot access the account to take money unless the pin is known.

Electronic Fund Transfer (ETF)

EFT is a system that allows money transfer instructions to e sent directly to a bank’s computer system. Upon receiving one of these instructions, the computer system automatically transfers the specified amount from one account to another.

Transfer instructions can come from other banks or from businesses.

A very common use of EFT is when a large business pays its employees’ salaries. On pay day, the businesses tells the bank to move money from the business account to the employees’ bank

Disadvantages

  • ATM may be off-line (system down).
  • You may forget your PIN number.
  • Risk of robbery when you leave the ATM.
  • The ATM can break down or run out of cash.
  • Fees charged to use ATMs of other banks can become expensive.

Applications of ICT in Banking

Done by Jeremie Canagaratnam

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