ABSTRACT
Electronic banking is the use of banking services, conducted via
electronic media and internet technology. With the rapid increase in the development and
availability of information and communications technologies e-banking has
become a reality. People are beginning
to sell and purchase goods via the Internet. They are beginning to transact and transfer
funds via the use of e-banking without feeling the need to visit banks.
The objectives of this study are among things to assist
microfinance banks to:
- Develop new and appropriate
service delivery channels to deploy;
- Manage their services more efficiently;
- Keep more effectively and
efficiently customer’s details / records through a database management system
for keeping.
The main motivation for this work
is the need to deliver more efficient and effective services to the urban and
rural poor who are the major patrons of microfinance institutions. This has become more imperative given the
fact that the facilities notably the increasing access of people to the World
Wide Web through cybercafés and even mobile makes it possible for more and more
people to gather banking information and carry out banking transactions via the
Internet.
The present semi-computerised
system in use by Garden City Micro Finance Bank was thoroughly investigated and
analysed using the SSADM/OOADM (Structure System Analysis and Design
Methodology / Object – Oriented Analysis and Design Methodology) and
prototyping approach.
The proposed e-banking
application was developed using Microsoft Visual Basic.NET and Microsoft Access
as a database management system. The new
system was designed into a well programmed online Web application, with the bank
records stored in a database in combination with an online registration of
customers and checking of account balances and supervisors details. Since data and its storage are considered to
be heart of any information system, it has to be up to date, accurate and
accessible in the required form and available to one or perhaps many users at
the same time.
Risk and challenges
involved are discussed while results and recommendations are included in the
report. The finding of the project on
the impact of electronic banking on banks profitability is that it may be
negative in the short run due to the capital investment by banks on
infrastructure and training but will be positive on the long run.
TABLE OF CONTENTS
CERTIFICATION.. ii
DEDICATION.. iii
ACKNOWLEDGEMENT. iv
ABSTRACT. v
CHAPTER ONE. 1
INTRODUCTION.. 1
1.1 BACKGROUND OF STUDY. 1
1.2 STATEMENT OF THE PROBLEM… 4
1.3 OBJECTIVES OF THE STUDY. 5
1.4 LIMITATIONS OF THE STUDY. 5
1.5 SIGNIFICANCE OF STUDY. 6
1.6 SCOPE OF THE STUDY. 8
CHAPTER TWO.. 10
LITERATURE REVIEW… 10
2.1 What is Electronic Banking?. 10
2.2 The Invention of Banking. 13
2.3 Banking and Finance on the Internet. 14
2.4 What is Microfinance Banking?. 15
2.5 The Concept of E-Banking. 18
2.6 The Growth of E-Banking. 19
2.7 Benefits of E-banking. 20
2.8 E-banking Tools/Channels. 21
CHAPTER THREE. 32
METHODOLOGY AND SYSTEM ANALYSIS. 32
3.1 METHODOLOGY. 32
3.2 STRUCTURED SYSTEMS ANALYSIS AND DESIGN METHODOLOGY AND ITS OOADM PARTNER. 33
3.3 PROTOTYPING.. 37
3.4 ANALYSIS OF THE CURRENT SYSTEM OPERATED BY GARDEN CITY MICROFINANCE BANK. 39
CHAPTER FOUR. 47
SYSTEM DESIGN.. 47
4.1 INTRODUCTION.. 47
4.2 OBJECTIVE OF THE NEW SYSTEM… 47
4.3 SYSTEM DESIGN.. 48
4.4 PROGRAM DESIGN.. 48
4.5 PROGRAM FLOWCHART. 49
4.5 DATABASE SPECIFICATION.. 49
4.6 INPUT/OUTPUT DESIGN.. 52
4.7 PROGRAMMING LANGUAGE. 57
4.8 PROGRAM MODULE FLOWCHART. 59
4.9 DATA DICTIONARY. 63
CHAPTER FIVE. 65
PROGRAM DOCUMENTATION AND IMPLEMENTATION.. 65
5.1 IMPLEMENTATION.. 65
5.2 HARDWARE AND OPERATING SYSTEM REQUIREMENT. 65
5.3 RUN/OPERATE THE SOFTWARE. 66
5.4 COMMUNICATION INTERFACE. 67
5.5 DETAILED IMPLEMENTATION PLANS. 67
5.6 SUMMARY, CONCLUSION AND RECOMMENDATIONS. 69
APPENDICES. 73
APPENDIX A: SAMPLE PROGRAM CODES. 74
APPENDIX B: SAMPLE OUTPUT. 84
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF STUDY
Electronic
banking (e-banking) is an umbrella term for the process by which a customer may
perform banking transactions electronically.
E-banking can be defined also as the automated delivery of new and
traditional banking products and services directly to customers through
electronic and interactive communication channels.
E-banking refers to the effective deployment of IT
by banks. But hold on, the fact that a
bank uses computers is not enough to qualify it as an E-Bank. E-banking is about using the infrastructure
of the digital age to create opportunities -both local and global. E-banking enables the dramatic lowering of
transaction costs, and the creation of new types of banking opportunities that
address the barriers of time and distance. Banking opportunities are local, global and
immediate in E-banking.
It can
also be defined as the automated
delivery of new and traditional banking products and services directly to
customers through electronic, interactive communication channels and other
technology infrastructure.
E-banking
includes the systems that enable financial institutions, customers, individuals
or businesses, to access accounts, transact business or obtain information on
financial products and services through a public or private networks, including
the Internet.
The following terms all refer to one form or another of electronic banking: – PC Banking, Internet Banking, Online Banking, Home Banking, Remote Electronic Banking and Phone Banking.
PC Banking,
Internet Banking and Online Banking are the most frequently used designations. It should be noted, however, that the terms
used to describe the various types of electronic banking are often used
interchangeably.
The variety
of electronic banking technologies available in the market place has greatly
expanded in recent years for financial institutions. Such technologies as Direct Deposit, Automated
Teller Machines and Debit Cards can speed processing and reduce costs. Other products and services for example,
computer banking and stored-value payroll cards are viewed as ways to retain
existing customers and attract unbanked and under banked consumer.
From the
consumer’s perspective, choosing to use electronic banking (e-banking) technologies
can mean easier and lower costs, bill paying, around the clock availability of
financial services, and time savings in managing finances. For some consumers, e-banking may not be a
matter of choice, as more and more financial transactions are being conducted in
an “electronic only” format.
Research suggests
that consumer acceptance and use of e-banking technologies are related to the
characteristics of both the individual consumer and the specific technology. These characteristics include factors such as
income and age, perceptions of specific technologies (such as perceived ease of
use) and personal preferences.
In many ways
also e-banking is not unlike traditional payment enquiry and information
processing systems, differing only in that it utilizes a different delivery
channel. Any decision to adopt e-banking
is normally influenced by a number of factors viz. the benefits to the customer,
service enhancement and competitive costs, all these are issues which motivate
banks to access their electronic commerce strategies.
Some other
benefits include the fact that e-banking can improve a bank’s efficiency and
competitiveness. Existing and potential
customers can benefit from a greater degree of convenience offered by the bank.
When combined with new services, e-banking
can expand the bank’s target customers beyond those in traditional
markets. Consequently, financial
institutions are becoming more aggressive in adopting electronic banking
capabilities that include sophisticated marketing systems, remote-banking
capabilities and stored value programs.
Internationally,
familiar examples include telephone banking, automated teller networks and
automated clearing house systems. Such technological
advances have brought greater sophistication to all users both commercial and
individual.
A bank may
generate different levels of risks and expectations arising from electronic
banking as opposed to traditional banking.
For example, customers who rely on e-banking services may have greater
intolerance for a system that is unreliable or one that does not provide
accurate and current information.
Clearly the longevity of e-banking depends on its accuracy, reliability
and accountability. The challenge for
many banks is to ensure that savings from the electronic banking technology
more than offset the costs and risks involved in such changes to their systems.
1.2 STATEMENT OF THE PROBLEM
With the
increasing patronage of microfinance banks by the urban poor and the growing
penetration of broadband services in Nigeria, there is an increasing need to
assist microfinance institutions to service their customers more effectively by
being able to store, manage and extract data efficiently.
The researcher proposes to design a web driven application to handle the transactions of a microfinance institution. This system captures information on customers, their account balances, loans taken, Journal entries and balances etc. Currently, these transactions are mostly processed manually or with low levels of computerization in many microfinance banks thus leading to a number of problems such as detailed below:
- Delays in service delivery;
- Too much paper work, leading to untidy management of records, redundancy and lack of data integrity;
- Delay in the preparation of monthly, quarterly and annual reports
- Ineffective access, retrieval and distribution of information
- Difficulty in transferring balances from one account to the other
- Inability to obtain information on transactions without having to come to the bank premises and having to wait for long time periods to obtain the required information.
DESIGN AND IMPLEMENTATION OF ELECTRONIC BANKING SOFTWARE FOR GARDEN CITY MICRO-FINANCE BANK
