Dr. Ecommerce Home


Ask Dr. Ecommerce a question

Q&A Alert
Latest Questions
Archives 2001
Archives 2000
Archives 1999
FAQ
Legal questions
European Institutions
Nat'l & local government
Technologies
Marketing & Selling
Definitions and Philosophy
How do I do it?
Money
General e-commerce

eThesis home
Universities and schools
eThesis best links

About Dr. Ecommerce
Discussion lists
In the news
Dr. Ecommerce speaks out

Board of experts
Legal guide
Statistics

16 Oct 2000, United Kingdom

Hi there!

I'm doing this project on the financial impacts of implementing ecommerce in the banking sector!

I wanted you to share your views with me on the following issues!

1. Are the majority of the banks making a profit or a loss after implementing ecommerce?

2. Is it necessary to implement an ecommerce website? if not, what will be the impact of not implementing and lagging behind in the race?

3. If a bank as of date has invested a million dollars in the internet, in what time will it be able to recover, or will it ever recover this huge sum!

4. There are a lot of security concerns. People fear hacking and as a result fear loosing the money due to this? Due you think this fear will start reducing if the banks start creating using more advertisements!

5. There are major tie-ups between top electronic commerce shopping web-sites and banks. What will be the cost of implementing the ecommerce a little late?

6. Global banking will no doubt receive a boost. But how will the balance of payments and other national income be determined?

7. At the end of the day, even if the banks allow their operators to use the net to shop, don't you think there should be a human element for various activities like mortgaging, loans, etc?

thanks a lot!

Dexter!

Dear Dexter!:

You're welcome a lot and I suggest you join the eThesis discussion forum for links to information on banks..

In the meantime, you have to define what you mean by e-commerce in the banking sector. I suspect you are referring to B2C banking, in other words banks serving individuals over the Internet.

It's important to bear in mind that banks have been moving money around electronically for years. Hence, banks have a head start as far as the technological infrastructure for Internet banking goes.

Internet banking has taken off with varying degrees of success in various places. The Finns have taken to it whole-heartedly and around one million (out of a population of 5 million) bank via the Internet. Many of them also bank over their mobile phones. Americans, on the other hand, have been surprisingly slow to implement e-commerce. But many Americans still pay their bills by handwriting cheques and sending them via snail mail to their creditors. So it may take some time yet.

Other companies have embraced Internet banking to varying degrees. As a result, Internet banking has met with success in some places but not others. Fortunately, as I said, most banks already have a lot of infrastructure in place and so it is less costly to implement e-commerce for a bank than it is for a shop. Add to that the fact that most banks offer e-commerce to their customers in order to cut their own costs, hence there is not a great need to acquire customers - as is the case for a pure play Internet company.

People in general are reluctant to change their bank without good reason (such as moving home, dissatisfaction with their existing bank, etc). Hence, I don't think banks will suffer too much by implementing e-commerce at a later stage. The main benefit to the bank, for implementing e-commerce is not so much more customers as reduced transaction costs. However, as more banks offer Internet banking and more consumers discover its convenience, the laggards will have to offer similar services - otherwise customers may find good reason to change banks.

Yes, people do worry about hacking at banks and I expect banks would benefit by promoting their security measures.

The balance of payment issues, etc will remain unchanged. As I have said, banks have been doing e-commerce with each other for years.

Finally, for more information on banks, take a look at http://www.nua.ie/surveys/ and enter "bank" into the search field.

Good luck,

Dr. Ecommerce