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In traditional Banking, borrowing money from the public and lending them to business units constituted the main functions of a bank.
When the banks became profit conscious and wanted to give more emphasis to profit generation, they started focusing on fee-based business. As a result, they started rendering different types of service oriented functions, which are called General Utility Services. These formed the subsidiary services of the bank. These included providing of safe locker facilities, Issuing of Letters of Credit, Dealing in Foreign Exchange, and underwriting loans floated by the Government,.
Modern day banks have been using the technology based services or electronic banking. The banking services are being rendered very fast and efficiently.
1. Telebanking services.
2. Net banking Services.
3. Issue of Credit and Debit Card services.
4. Bank assurance.
5. ATMs.
6. SMS Alert services.
7. Electronic Funds Tranfer system. (For ex. NEFT)
8. Electronic clearing services (RTGS)
Thus in traditional banking the services are slow, but personalised; whereas in modern banking, due to the introduction of technology, the services are rendered fast. The physical and space barrier are removed completely and one can do banking 24 X 7, that is all round the year on all days from anywhere. The services are also rendered fast. One need not physically go to a bank to withdraw money. One can draw money even at midnight.
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Modern banking system has been able to incorporate technology into the banking industry. This is what has made online and mobile banking possible.
What is the Conclusion to banking?
The conclusion to banking emphasizes its critical role in the global economy by facilitating transactions, providing credit, and managing risks. It serves as a cornerstone for economic growth and stability. However, the industry also faces challenges such as regulatory pressures, technological disruption, and evolving consumer expectations, necessitating ongoing innovation and adaptation. Ultimately, the future of banking will depend on balancing traditional practices with modern demands.
What is the difference in traditional and modern approach in financial management?
Oh, dude, the traditional approach in financial management is like your grandma's recipe for apple pie - tried and true, but a bit old-fashioned. The modern approach is more like a fancy food truck serving up fusion cuisine - innovative, flexible, and always trying new things. So, yeah, traditional is like sticking to the same old routine, while modern is all about shaking things up and adapting to the ever-changing financial landscape.
Who is the father of modern banking?
The father of modern banking is Nicholas Biddle I spent 20 years teaching and as a gust lecturer for the American Institute of Banking as well as a 40 year banking career. Biddle fought the "Bank Wars" against Andrew Jackson regarding the 2nd Bank of the United States. Todays Federal Reserve System (the FED) is designed around his genius. LD Wright
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