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July 2, 1999
Banks warned against ignoring online servicesThe prospects of traditional banking services in India are bleak as online banking services are becoming very popular, claims ICICI Managing Director K V Kamath.
While inaugurating BANCIT '99, a banking technology event hosted in Bangalore, he stressed that the banking sector should adopt online banking as early as next year. Even industry regulators should realise this and take the necessary steps, he said.
The event is being hosted by software major Infosys.
He said ICICI would resort to cost-effective Internet based banking operations within the next three months.
Kamath said the institution would also take up transfer of money from the United States shortly and the transfer would take place within 48 hours as against the existing lag of four weeks.
He assured that the Internet is set to become all-pervasive with one out of seven transactions in volume now being carried out over the Web.
The cost of Web based banking works out to only 12 per cent per rupee as against 18 per cent through telephone and ATM and 40 per cent by posts.
Kamath does not believe in the view that illiteracy in rural areas is a barrier against the spread of online banking in India. He says such a perception is a myth and on the contrary only those institutions that take a lead in setting up online operations in rural areas would succeed.
The two-day meeting is being attended by the best in the banking and information technology sector. It would address banking in the next millennium - from strategy to implementation.
The sectors being covered include back office systems, information and control systems, self-service banking and networking and payment systems.
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