Benefits of Information Technology to the Banking Sector

Benefits of Information Technology to the Banking Sector
A Case Study of the Cosmos Cooperative Bank Ltd.

Information technology has transformed the functioning of business all over the world. It has expanded the reach and coverage of systems.   Use of IT made it possible to take better decisions on the basis of latest and accurate information. It has also contributed to reduction of costs and improvement in efficiency. In India the financial sector especially the banking sector is a major beneficiary from the implementation of IT. The banking sector uses IT basically for two different purposes one is communications and connectivity other is business process reengineering. The post liberalization period witnessed a sea change in the banking sector of India. Implementation of reforms has transformed the banking sector which is now entirely different from what it was few years ago. Reforms have introduced competition in this sector which has lowered the profit margins. The key business objective of banks in the changed scenario is to manage increasing competition by enhancing profitability, productivity and customer satisfaction. Technology has a very important role to play in achieving this objective. Adoption of technology leads to a number of benefits to the bank and its customers. The paper focuses on the following benefits.

• Benefits to the customer
• Reduction in operational costs
• Increase in efficiency
• Improvement in the quality of assets.

This paper aims to highlight the benefits of IT with special reference to the Cosmos Cooperative Bank Ltd. (Cosmos Bank) which made a humble beginning as a small cooperative credit society on January 18, 1906 and is at present a leading multi-state scheduled cooperative bank providing banking facilities in the states of Maharashtra, Andhra Pradesh, Madhya Pradesh, Tamilnadu, Karnataka and Gujarat. The thrust areas of Cosmos Bank are growth, continuous adoption of updated technology, and constant endeavor for...